Last fall, Reality One teamed up with WEVR and Jon Favreau to launch the preview of Gnomes and Goblins, a virtual reality experience created by Favreau and co-produced/co-published by Reality One. R1 also recently announced an exclusive first-look deal with Sony Pictures to create virtual reality content based on their IP. Cynopsis Digital editor David Teich talked to Clint Kisker, Co-Founder of Madison Wells Media (MWM) and Reality One (R1), about his take on the future of virtual reality.
Cynopsis: A lot of VR content and hardware came out in 2016, but it’s not yet the mass consumer medium that some people believe it can be. Moving forward, what are the biggest challenges when it comes to getting VR content in front of as many eyeballs as possible? And how long will it be before VR truly scales?
Clint Kisker: In immersive content, we are all in the covered wagons heading West, so to speak. With so much VR/AR content being produced, definitive proclamations are and should be met with real skepticism. However, what truly distinguishes the appeal of VR/AR to consumers from previous false starts begins and ends with the user-experience.
When someone has that firsthand high-end experience, it imprints deeply and stays with people as a magical moment of forced presence. This immersion is a solid foundation upon which to grow- especially when it comes to building an entertainment medium. I like to compare this experience to the moment audiences first heard sound in Steamboat Willie in 1928. Just like that, a new connection to the moving pictures was created, wholly different from the silent cartoons audiences were accustomed to.
This kind shift is not small, and deserves the amount of capital and resources folks are now investing in exploring the near-endless possibilities that VR/AR presents.
The biggest challenge VR/AR now faces is that cultivating this magical moment is expensive and not easy to find for the consumer. Beyond cost hurdles and limited availability, putting on a clunky tethered device unsure of what the experience will provide is not always alluring to users. This will change in time, but as costs come down, mobile VR quality increases and six degrees of freedom becomes possible on comfortable form factors, consumers will be hooked on better and better content as storytellers continue to gain comfort with the medium. This is likely a process that will take hold over the next 24-36 months, but as with Mario, Sonic and even Mickey Mouse, we expect the break through content to be characterized by a deep connection between consumer and character, and the world they inhabit together. That’s why we are so excited about Gnomes and Goblins, working closely with Jon Favreau to bring his vision for that world to life.
Cynopsis: Why are movie studios like Sony Pictures and 20th Century Fox branching out into VR content? What does the monetization model look like – is it mostly just about promoting their films? Could there come a point where such VR experiences themselves could also generate substantial revenue on their own, whether through transactional purchase, ad revenues, or subscriptions?
Kisker: We have partnered with Sony as their exclusive partner in VR because we feel that as the medium develops and the content becomes more and more compelling, well known, premium IP is going to be a very important differentiator (we are already seeing that with sales of Batman-Arkham). I will let Sony speak for themselves as to why they are stepping so heavily into VR, but can say that their company and the promise of marrying hardware and software (PSVR-VREs) has always held tremendous potential, so VR is a seemingly perfect nexus. In general, there is a need for companies that make entertainment to transition to growth mediums, as markets mature. VR offers the kind of entertainment value to consumers that makes sense to support with resources as it moves into a paying/revenue generating medium.
It’s worth thinking about this question from a global perspective as well as there are already millions of paying consumers for VR in Asia in location based VR centers. So while the in-home download to own market in the US will continue to come online, there are already substantial revenues being generated globally – especially for well-known IP.
Cynopsis: Most industry analysts think the AR industry will be significantly bigger than the VR industry when all’s said and done. Do you agree with that? What do you think the AR landscape will look like in 2017?
Kisker: There’s a great scene in Ron Howard’s Apollo 13 where all the NASA engineers are called into a room, told what tools they have to work with, how much time they have, and asked to invent a way to get the astronauts home.
This is kind of where I see AR in 2017.
The promise of what it can one day do is the work of an increasing number of people focused on what needs to be invented to make it compelling and bring it to consumers -which is awesome. Because they will get there and in certain cases already are there – HoloLens, for example, though not really an entertainment driven device, is very compelling. And while it is not what most people think of when they say AR, Pokemon Go proved that mixing high quality IP with mixed reality gaming can be a very lucrative proposition.
As to the eventual size of the respective markets, I believe AR is naturally adaptable and flexible and applies to more industries than VR probably does, which logically makes AR a bigger ultimate market. That said I believe the entertainment component of VR and AR, which is where we are focused, will offer unique elements to consumers, so both will thrive.
Cynopsis: Faceook, Twitter, and a number of other companies spent a lot of time and money in 2016 ratcheting up their live video efforts. Do you think that’s an effort that’s going to pay off for content producers and/or digital platforms? What needs to happen before live video becomes the moneymaker these companies want it to be, and what trends do you think we’ll see in 2017?
Kisker: I believe that 360 video is a storytelling medium that will replace 2d video as the medium I expect to see my buddy’s son’s first steps on, or the recorded message my daughter sends from college. I will come to expect to be able to look around videos, and that’s not 5 years away, it’s maybe 2 or 3. To me, the promise of 360 video is greater access, so I would expect influencers and celebrities to offer exclusive access to themselves in 360 video live stream as an added way to monetize their time and connect more deeply with fans. It will be particularly interesting to see how this plays out in political campaigning, as the trend seems to be removing the intermediaries (media) in retail politics.
Cynopsis: VR, AR, live video – none of this can truly reach consumers en masse until the quality of the content matches the hype. What’s lacking in some of the content that’s out there right now? As a production company, what have you learned so far about how to tailor content to these new mediums? What works, and what have you learned doesn’t work?
Kisker: As with the Mario, Sonic and Mickey examples above, or even Halo with Xbox, the break though comes when a) there are means of reaching meaningful volumes of consumers with the ability to consume and b) they discover the content that matches the potential of the medium and becomes the defining example. So we are not there yet, clearly. However, we are experimenting and learning and taking those incremental steps towards that moment, and seeing the positive responses, which has been amazing to be a part of. As with arcades for video games in the 1980s, many people globally will discover VR out of their homes – that’s happening already and we believe will continue to develop in the west as it has in the east. That, combined with mobile VR device and HMD quality improving, will start to ease the pain points and friction that exist today. Just as watching the recent Jungle Book would be mind-blowing to someone pulled from the Lumiere Brothers theater in 1895, fast forwarding even 5 years from now would likely be a mind altering experience for today’s consumer. But the kernel of magic is there and it presents an amazing opportunity to learn and, if we are lucky, to help deliver the next Mario, Sonic, or dare we say, Mickey. Creative humans who tell stories and create these characters and worlds using this medium will unlock all of this and that is a very exciting proposition.
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