Steven Spielberg and Alejandro G. Inarritu Are Betting That Virtual Reality Will Actually Make Money

The Hollywood Reporter

"Virtual reality" has become the hot new buzzword. But while Hollywood studios are shelling out tens of millions to explore its promise, most of that money is going into tech research or marketing departments looking to create branded content to support upcoming movies.

If VR is to become a genuine reality, though, what's needed now is a steady stream of revenue-producing content, argues Jim Mainard, executive vp digital strategy and new business development at DreamWorks Animation. He plans to make that case at the Digital Hollywood conference, where he will be one of the studio executives speaking about the future of VR and augmented reality.

In terms of Hollywood-inspired VR content, motion picture IP-based experiences are on the rise, with recent work drawing inspiration from such films as Warner Bros.' Suicide Squad and Disney's The Jungle Book. Suicide Squad VR Experience, available on Samsung VR, features the demolition of a corporate office, with characters including Harley Quinn and Deadshot.

Photofest

Marketing departments "are expecting to create buzz around a film [with a VR experience]. Some are quite good, but they're not moving us toward a business model to reach people on a regular basis," warns Mainard, adding that this current state of VR "feels like what happened with 3D TV. We had event movies, but not content that made us check in every day or every week. There was no Game of Thrones in 3D."

But he predicts that "2019 may be where we turn the corner for revenue." Gaming generally is viewed as the low-hanging fruit - for instance, titles such as EVE: Valkyrie and Batman: Arkham VR are available for PlayStation VR's Oct. 13 launch. And on the narrative side of the equation, soon to come is the first VR content from leading Hollywood directors such as Steven Spielberg and Alejandro G. Inarritu. The Mexican-born helmer is planning an experimental VR short film exploring the experience of immigrants and refugees crossing the border between Mexico and the U.S.

Read more: Oculus Connect 3: Disney, 'Blade Runner 2049' Virtual Reality Content on the Way

In addition to content, a critical mass of consumers with VR headsets also is needed. To that end, in October Google introduced its Daydream View VR headsets for Android devices, which will ship for $79 in November. Daydream joins other systems for viewing VR using a mobile device, such as Google's earlier Cardboard and Samsung's VR Gear.

At the high end of the emerging tech, Sony begins shipping its PlayStation VR headsets, which require a PlayStation 4, on Oct. 13 for $400. Oculus Rift and HTC Vive are available for $599 and $799, respectively, though both require a supported computer. With roughly 43 million PS4 systems already installed, Sony may have a sizable advantage. "There's a lot of anticipation due to the installed base," says Fox futurist Ted Schilowitz.

Read more: Imax Opening First European Virtual Reality Center in Manchester

Fox has been demonstrating its The Martian VR Experience at industry trade shows all year, but the interactive 20-minute narrative requires hand controllers that haven't been readily available. But The Martian will soon reach consumers on PlayStation VR, for which controllers can be purchased separately, and HTC Vive, which began shipping last spring with controllers included. The Martian also will be available for Oculus Rift headsets once the Rift's Touch controller comes to market Dec. 6.

"Hand control is a big topic," says Schilowitz. Although the first wave of VR devices didn't allow viewers to interact with the environment around them with their hands, that's about to change. And, says Schilowitz, "I think the best experience is full-body immersion, where you're using your hands."

***

DON'T-MISS TOPICS AT DIGITAL HOLLYWOOD

The Hollywood VR-AR State of the Union
Oct. 18, 6:15 p.m.

Dinner speakers include Chris Defaria, Warner Bros. president of animation and technical innovation; Paul Hook, partner/head of motion picture production at ICM Partners; and DWA's Mainard.

The Power of VR-AR: A New Language of Artistry
Oct. 19, 4 p.m.

Skydance's Spencer Hunt and Digital Domain's Aruna Inversin in a conversation about art and business, moderated by THR's Carolyn Giardina.

Ken Burns' "Defying the Nazis VR" 
Oct. 19, 6:15 p.m.

Director Elijah Allan-Blitz presents a VR experience that simulates a 1940s escape from Europe.

Evening Keynote
Oct. 19, 6:15 p.m.

Perspectives on VR from the Television Academy's Seth Shapiro.

This story first appeared in the Oct. 21 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.