According to a report from The Financial Times, Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL) is looking to further compete in virtual reality. The company already offers a virtual-reality experience through its Cardboard VR headset, but is reportedly looking into a more durable headset much like Samsung's Gear VR.
However, the bigger story is Alphabet is supposedly bringing VR functionality into its Android Operating System. In the past, the company has relied on third-party developers for virtual-reality support. Bringing virtual-reality processing into Android should encourage adoption among third-party app developers currently not offering a VR experience and eventually result in end-user acceptance as VR experiences become more commonplace.
Does it matter?
While it's unclear if VR will be the next big thing, Alphabet's not alone in its virtual-reality ambitions. Another report from The Financial Times chronicles Apple's (NASDAQ:AAPL) moves into the space. Apple has purchased four virtual-reality companies, is staffing up in its VR division, and now offers Mattel's View-Master virtual-reality headset in its Apple Store. In totality, these moves point to a company that is looking to quickly integrate a virtual-reality experience into its ecosystem.
When it comes to VR, however, the current pace-setter appears to be Facebook (NASDAQ:FB). The company's purchase of VR headset maker Oculus VR in 2014 for $2 billion is now starting to bear fruit. Oculus' flagship Oculus Rift headset is now available for preorder with shipments to 20 countries starting on March 28. It's starting to look like these tech giants are in a battle to shape the future of this nascent technology.
Out of the three competitors, Android may be the best positioned to command virtual reality going forward. Earlier this year Google CEO Sundar Pichai reported Android had 1.4 billion active users over the last 30 days. Through sheer scale, Alphabet should be a major player in the virtual-reality industry. It's highly likely Alphabet will be able to monetize virtual reality directly by VR headset sales, but the growth of virtual reality -- regardless of provider -- should directly benefit Alphabet through increased search and advertisement revenue. Although its effects on the investing thesis are somewhat unclear, the growth of virtual reality for all three companies should be closely monitored.