Sony Is Struggling with Its PlayStation VR2 Sale, And 'Lack Of Content' Is Its Biggest Issue As Well
AInvestMonday, Mar 18, 2024 5:10 am ET
1min read
SONY --

According to sources familiar with the matter, Sony Group has temporarily halted production of its flagship virtual reality headset, PlayStation VR2, due to poor sales, until it can clear unsold inventory.

This exacerbates doubts about the appeal of virtual reality devices and further highlights the bottleneck that a lack of VR content brings to hardware sales.

Sony's PS VR2, launched in February last year, initially retailed for $549.99 and is designed to solely support Sony PS5 for gameplay. However, since its launch, the product has seen dwindling sales and mounting inventory.

Sources report that since its launch, Sony has produced over two million PSVR2 units, creating an oversupply across Sony's entire supply chain.

According to the International Data Corporation (IDC), shipments of PS VR2 have been declining every quarter since its launch. The firm tracks shipments to retailers and not consumers.

Sony announced last month that it would be closing its PlayStation London division, focused on developing VR games, as part of extensive layoffs. The layoffs also affected the renowned Guerrilla Games studio, which had been devoted to developing a PlayStation VR2 exclusive game, Horizon: Call of the Mountain, as part of Sony's popular Horizon game series.

In an attempt to boost sales, Sony is working to expand the functionality of PS VR2. In February of this year, Sony announced that it was testing running games on PS VR2 on PCs to enable PS VR2 usage on platforms other than PS5.

Like Meta Platforms Inc., Sony has been a leading supplier of virtual reality devices. However, at present, the VR hardware devices of both Meta and Sony are hindered by the lack of applications and content related to VR.

Apple, which recently launched its VR product, faces a similar problem. At the launch of Apple's VR device, the device could not install custom applications from major entertainment platforms such as Netflix and YouTube.

Macquarie analyst Yijia Zhai said the high cost of VR hardware and lack of content are major obstacles to the expansion of this device. At the moment, there are limited games supporting VR devices, resulting in limited incentives for users to purchase VR hardware, even though there are reasons for the limited VR content - VR game development costs are much higher than regular games.

Nevertheless, according to Francisco Jeronimo at IDC, the VR product category is likely to revive in the next few years following Apple's entry into the VR market, as he predicts that the VR market will grow at an average annual rate of 31.5% from 2023 to 2028.


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