How Oculus Goggles Became More Than a Virtual Reality


By Ian Sherr

Brendan Iribe traces the surprising rise of Oculus VR Inc., FacebookInc.’s second-largest acquisition, to a demonstration in a hotel meeting room two years ago.

The videogame-industry executive had traveled to the hotel in Long Beach, Calif., after meeting with Palmer Luckey, a virtual-reality enthusiast who at the time was planning to launch a crowdfunding campaign on Kickstarter Inc.’s website for high-tech goggles. His product eventually became “Oculus Rift.”

Mr. Luckey, clad in flip-flops, shorts and a T-shirt, had cobbled together a prototype using a screen typically meant for a smartphone. The room’s lights had to be turned off to make sure Mr. Iribe saw the best images from the device, which was connected to a laptop.

But once he put it on his head, Mr. Iribe says he was transported to a three-dimensional view of a room from “Rage,” a sci-fi shooting game. “It really worked,” said Mr. Iribe, who would become chief executive of Oculus.

Mr. Iribe acknowledges that he could only use the goggles for a short period of time before becoming dizzy. That problem and others have dogged the virtual-reality field since such goggles emerged in the early 1990s, prompting a brief flurry of attention in movies and TV shows before fading from the Silicon Valley scene.

But Facebook CEO Mark Zuckerberg on Tuesday declared that Oculus—which has yet to even ship a commercial version of the goggles it sells to developers for $350—represents the seeds of an entirely new computing platform. The social network agreed to pay $2 billion in cash and stock for Oculus.

“Virtual reality was once the dream of science fiction,” Mr. Zuckerberg wrote in a blog post. “But the Internet was also once a dream, and so were computers and smartphones.”

3-D Is in Focus at Videogame Conference


Harry Campbell (The Wall Street Journal)

By Ian Sherr

Programmers have long tailored videogames for computers, television consoles and mobile devices. Now they are also targeting three-dimensional simulations enabled by special eyewear, a key focus of a conference this week in San Francisco.

Many developers descending on the Game Developers Conference are expected to come toting prototype videogames, movies and virtual-reality goggles—updates of offerings that ignited a short-lived technology craze in the early 1990s.

Current players on the scene include the startup Oculus VR, which announced low-cost virtual-reality goggles two years ago. Discussions about creating 3-D games to exploit such technologies are on the agenda at the event, known as GDC.

Virtual reality is closely linked to 3-D technology, which has long been used in movie theaters and is spreading rapidly to other applications. Companies such as Valve Corp., famous for its “Half-Life” and “Portal” videogame franchises, developed products for using this technology in videogames. Virtual-reality goggles instead have built-in displays to help convey the effect of entering a simulated world, instead of relying on transparent 3-D glasses for viewing a movie or TV screen.


To read the rest of the story, either contact me directly or read more online at the WSJ: here. (subscription required)


(Published March 16, 2014, at The Wall Street Journal.)

Videogame Makers Duke It Out Arena Style


By Ian Sherr

Videogame makers have been grappling with many changes in the past few years, from new living-room consoles to the rise of smartphones. Now they face another challenge: arena-style games like “League of Legends.”

Gamers have flocked by the millions to play the Riot Games Inc. title, which typically pits two teams of five players in battles involving mystical characters called champions. The action is viewed from above—more like a simulated board game than the familiar first-person shooter perspective—and typically played online using PCs rather than consoles.

Gamers can play without paying, in contrast to traditional videogames, which sell for as much as $60 each. Under the so-called freemium business model, Riot Games charges only for extras, like the ability to play as a specific champion or to change the look of their characters.

“League of Legends” is tapping into growing communities of customers who prefer to play in a less-solitary style.

“A lot of the reason people play games is that their friends are playing,” said Dennis Fong, a former competitive gamer and now chief executive of Raptr Inc., a service that helps gamers performance-tune their PCs.

“League of Legends” is just one example in a game genre that industry executives call “multiplayer online battle arenas.” It has become one of the hottest segments in a largely stagnating videogame market—and it is taking market share from traditional videogames.


To read the rest of the story, either contact me directly or read more online at the WSJ: here. (subscription required)


(Published March 16, 2014, in The Wall Street Journal.)

Microsoft Quietly Pulls Xbox Two-Year Contract Plans


By Ian Sherr and Shira Ovide

This week, Microsoft spokesman David Dennis confirmed the company discontinued the Xbox 360 offer in July. “This program was intended to be a pilot experiment from the start, and Microsoft routinely adjusts the mix of offers available to its customers and this change was simply standard business practice,” he said.

When the program was launched in May 2012, some analysts speculated Microsoft might be testing the approach to use on the then-unannounced Xbox One. But Lewis Ward, a videogame analyst at IDC, said Microsoft executives last year told analysts the pricing shift had been a way to milk waning sales for the Xbox 360, the console version launched in 2005.

“Part of the calculus was probably the numbers of customers who were buying Xbox 360 through that approach tapered off,” Mr. Ward said. The subscription option was for “squeezing the last 10-15% out of the potential market.”


To read the rest of the story, either contact me directly or read more online at the WSJ: here. (subscription required)


(Published March 12, 2014, in The Wall Street Journal.)