Please ensure Javascript is enabled for purposes of website accessibility

A Foolish Take: Which Company Is Leading in the Virtual Reality Race?

By Leo Sun - Apr 10, 2017 at 12:00PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Tech companies still believe that VR is the next big thing, but mainstream adoption remains sluggish.

Many tech companies believe that virtual reality (VR) will be the next major growth market. That's why big names like Facebook's (FB 1.83%) Oculus, HTC, Sony (SONY 1.90%), Samsung, and Alphabet's (GOOG 4.16%) (GOOGL 4.20%) Google have all jumped into this nascent space.

Tech advisory firm Digi-Capital believes that the VR market will grow from $2.7 billion in 2016 to $25 billion by 2021. The top headsets in the market last year included Samsung's Gear VR, Sony's PlayStation VR, Facebook's Oculus Rift, HTC's Vive, and Google's Daydream. But the only headset to top a million shipments was the Gear VR, which launched in late 2015, before the other devices.

A chart displaying 2016 VR headset sales in millions: 4.5 million Gear VRs, 0.75 million PSVRs, 0.42 million Vives, 0.26 million Daydreams, and 0.24 million Rifts.

Data source: SuperData Research. Chart created by the author.

That disparity is likely due to the fact that the $100 Gear VR, which only works with Samsung's newer flagship devices, costs much less than the other options. The $800 Vive and $600 Rift both require high-end gaming PCs, which can run more than $1,000.

The PlayStation VR is a cheaper option at $400, but only works with the PlayStation 4. Google's $80 Daydream, which arrived near the end of 2016, is basically a Gear VR for non-Samsung Android devices, but the list of compatible devices remains short.

It's too early to declare a winner in the VR race, but the market this year will likely look similar to 2016 -- cheaper smartphone-based headsets will probably sell better than pricier PC and console-based ones, as the latter two appeal more to hardcore gamers than mainstream consumers.

Offer from The Motley Fool: The 10 best stocks to buy now
Motley Fool co-founders Tom and David Gardner have spent more than a decade beating the market. In fact, the newsletter they run, Motley Fool Stock Advisor, has tripled the S&P 500!*

Tom and David just revealed their ten top stock picks for investors to buy right now.

Click here to get access to the full list!

*Stock Advisor returns as of 4/3/2017.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Alphabet Inc. Stock Quote
Alphabet Inc.
$2,246.33 (4.20%) $90.48
Sony Corporation Stock Quote
Sony Corporation
$92.26 (1.90%) $1.72
Meta Platforms, Inc. Stock Quote
Meta Platforms, Inc.
$195.13 (1.83%) $3.50
Alphabet Inc. Stock Quote
Alphabet Inc.
$2,255.98 (4.16%) $90.06

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/29/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.