Hollywood filmmakers’ ultimate goal has always been to make the audience forget it is watching a projection on a flat screen and instead feel like it is experiencing a story firsthand. For the film industry and investors alike, virtual reality may be the golden ticket to the next era of the movie industry.
Loup Ventures analyst Gene Munster attended the Cannes Film Festival this month to discuss VR technology with some of the top names in film. According to Munster, VR offers Hollywood too many opportunities to resist.
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“Filmmakers know that VR will enable new ways to engage audiences,” Munster says. VR can provide a unique, 360-degree 3D visual experience and offer audiences the opportunity to control viewpoint and plot advancement.
Munster says established filmmakers will likely proceed with caution on VR at first. However, aspiring filmmakers will pursue VR more aggressively after witnessing the way Netflix ( NFLX) and Walt Disney Co.’s ( DIS) Pixar have transformed the movie business by embracing innovative technology.
In addition, Facebook’s ( FB) recent decision to shut down its Oculus Story Studio leaves the door wide open for VR startup studios.
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For now, Munster says the limiting factor in the adoption of VR will be hardware. While there are only about 2 million high-immersion VR headsets in use around the world today, Munster says that number will skyrocket to 146 million by 2022.
Price will likely pay a key role in that growth. Facebook’s Oculus Rift headset and HTC’s Vive headsets cost more than $1,000. Alphabet’s ( GOOG, GOOGL)’s Daydream headset costs about $700.
Munster says VR investors should watch the gaming industry as a leading indicator of what to expect from the film industry. “Gamers will be early adopters given they are the largest segment of Rift and Vive users,” Munster says.
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IDC Research estimates that the global VR market could expand from $5.2 billion in 2016 to more than $162 billion in 2020.
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Virtual Reality Will Change Hollywood Forever originally appeared on usnews.com
