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COKE VS. PEPSI

The first major battle in VR is between Facebook and TikTok’s parent companies

A user wearing the Pico VR headset from ByteDance
Pico/ByteDance
A user wearing the Pico VR headset from ByteDance
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Just months after Meta’s chief technology officer, Andrew Bosworth, stealthily previewed the company’s next virtual reality (VR) headset in a since-deleted tweet, more details about the device have surfaced. Code in Meta’s iOS app appears to reveal the official name of the upcoming device: Meta Quest Pro. 

The name, revealed in a report from Bloomberg this week, substantiates previous reports that Meta’a next VR headset would be a higher-end product targeting professional and business users—with additional features and a higher price tag to match. Back when the first images of the new device were shown off, another code snooper found tutorial videos that matched the images shared by Bosworth. Then, in June, Meta CEO Mark Zuckerberg gave the world a more detailed look at the new headset, confirming its look and feel, while discussing its advanced features. 

Market intelligence firm International Data Corporation (IDC) estimates that Meta has sold roughly 15 million units of its most recent headset, the Quest 2, since its launch at the end of 2020. So far, it’s the most successful VR headset on the market, but it’s still nowhere the scale of the billions of users present on Meta’s Facebook, WhatsApp, and Instagram platforms. 

Meta can see the competitive landscape unfolding and is shifting to meet the challenge

Aside from the newness of VR as a platform, the other part of the Quest’s relatively modest growth curve may have to do with the company’s checkered history that has made it unpopular with some users.

Following Facebook’s acquisition of Oculus VR in 2014, the company’s founder, Palmer Luckey, assured passionate early Oculus users that they would never need a Facebook account to log into the service. Years later, in 2020, many in the VR community cried foul when the company broke that promise and announced that they would indeed need a Facebook account to log in.

In response to user complaints about the login policy, Meta recently decided to reverse course. On Thursday, in a Facebook post, Zuckerberg followed up on his promise during last year’s Facebook Connect event that users would no longer need a Facebook account to access the Meta Quest VR platform. “You won’t need a Facebook account to log into Quest starting next month,” wrote Zuckerberg on his Facebook account. “We’re rolling out new Meta accounts that you can use with our VR headsets instead. This will give everyone more choice about how you show up in the metaverse.”

Will TikTok users migrate to VR? ByteDance intends to find out

For Meta, decoupling the Quest VR community from Facebook is, apparently, worth the trade-off of possibly losing the potential conversion of Facebook’s nearly 3 billion users to its VR platform. But why now? The answer, as always, is competition. 

Amid increasing chatter around a possible VR device coming from Apple, some have overlooked the other tech behemoth entering the space: ByteDance, the parent company of the popular social media app TikTok. ByteDance acquired Chinese VR headset maker Pico Interactive for an undisclosed sum in August 2021. Pico is one of the few companies that manufactures an all-in-one VR headset that doesn’t require an external PC to operate. In many ways, Pico’s latest device, the Pico Neo3, is identical to the Quest 2. 

Since the acquisition, ByteDance has acted quickly to get the device into the hands of users in Europe, a move that fueled speculation that the company might have its sights set on entering the US market and challenging Meta’s Quest 2. Those suspicions were recently confirmed when a long list of job postings began appearing for roles at Pico Studios in Seattle, Washington, and Mountain View, California, for positions involving software development, content ecosystem management, marketing, and sales. 

VR users in the US may face a “Coke or Pepsi” choice in the metaverse

Next to Meta’s Instagram, which has 1.2 billion users, one of the most popular social media apps among Gen Z and Millennials is ByteDance’s TikTok, which now has 1 billion users. And while there’s no guarantee that the installed user base ByteDance enjoys on its TikTok product will be immediately transferable to its Pico VR platform, the parallels between what Meta has been doing and the new efforts from ByteDance are hard to ignore. 

Although Zuckerberg has helped to take the idea of the metaverse mainstream for Wall Street and consumes alike, the company’s rebrand as Meta hasn’t quite removed the doubts surrounding the company’s culture and direction. Those doubts, predictably, have somewhat colored the overall profile of the metaverse and its viability in the eyes of skeptics. Similarly, the concerns in the US that dog TikTok and its potential links to the Chinese government may also influence how Pico’s VR offerings are received. 

Nevertheless, now that Meta’s Quest has a true rival with competitive scale and similar billions to spend, the race to monetize virtual reality is poised to become much more contentious.

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