High-End VR Platforms Struggling for Market Share

Oculus Rift, HTC Vive, PlayStation VR represent sliver of market
VR headset market share 2016- strategy analytics.jpg

Low-end Google Cardboard viewers that work with smartphones continue to dominate the virtual reality headset market while higher-end VR products, like the Oculus Rift, are struggling to gain traction in the early going, a new report from Strategy Analytics found.

The research firm estimates that more than 30 million VR headsets have been shipped, while Cardboard viewers claiming a dominant 69% share by the end of 2016, but accounted for just 12% of revenue share.  

RELATED: Analyst: Best Buy Oculus Demo Shutdown 'Doesn't Bode Well' 

The Samsung Gear VR headset, which is powered by Facebook-owned Oculus and works with compatible Samsung smartphones, held about 17% of the market through 2016, and 35% of revenue share. In January, Samsung said it had shipped more than 5 million Gear VR headsets.

The Oculus Rift, Sony PlayStation VR, and Steam-powered platforms like the HTC Vive, have had trouble gaining share. Daydream View, Google’s mobile VR headset, ended the year with a microscopic share of the market, but that product has only been available since Nov. 10, 2016

RELATED: Google Unveils Daydream View VR Headset, Controller

“Our data shows that Google has a commanding lead in terms of shipments and installed base for its ultra-low cost Cardboard VR platform, and the size of the audience is already attracting marketers and brands looking to use VR as a promotional tool,” David MacQueen executive director of Strategy Analytics’s virtual reality ecosystem research program, said in a statement. “However, it accounted for merely 12% revenue share. The higher-spec smartphone VR platform, Samsung Gear VR, took top spot by revenues with a 35% revenue share. Sony’s successful PS VR launch sees that platform take second place by revenues, and between them Sony and Samsung captured more than half of VR hardware revenues in 2016.”

Strategy Analytics is also anticipating “some shakedown” in a fragmented VR market that has six competing ecosystems, according to Cliff Raskin, a senior director at the research firm.