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The iPhone-maker’s latest purchase signals that Apple is banking on live events like sports and concerts to edge deeper into the XR ecosystem. Apple reportedly spent around $100 million on NextVR, a VR streaming startup specializing in creating virtual experiences for live events that has previously partnered with the NBA, NHL, Fox Sports, and WWE to produce immersive content for several existing VR headsets. NextVR’s website now reads, somewhat cryptically, that the company is “heading in a new direction.”
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The device, which would be the company’s first immersive headset, would join Apple’s wearable device segment — the tech giant’s fastest-growing business. Apple could integrate the technology from NextVR with its XR headset, particularly into its subscription media services. For instance, it could integrate NextVR’s tech with Apple Music to broadcast live concerts in VR to recreate the festival experience in a simulated world. Apple could also integrate the tech with its Apple TV service, in order to offer subscribers the ability to stream live sports events and matches in VR.
The NextVR acquisition is a win for Apple, as we expect the adoption of virtual live event viewing will be significantly accelerated as a result of the coronavirus pandemic — creating opportunities for Apple that can pay off both now and later.
Consumers stuck at home during the pandemic are turning to virtual entertainment experiences at an unprecedented rate. Houston rapper Travis Scott held an event within the virtual world of Fortnite, which was attended by Fortnite players whose avatars could dance to Scott’s visual effects-laden performance. The concert garnered 27.7 million unique visitors and was viewed over 45 million times, setting a single-event attendance record for Fortnite.
Likewise, Minecraft held Block By Blockwest, a virtual music festival that had to be rescheduled because the unexpectedly high attendance of 100,000 users crashed the servers. We think surging demand for virtual entertainment will likely lead to lasting changes in the music industry, as it is still uncertain what traditional live music events will look like in the post-pandemic world.
And if professional sports return without fans, as many have suggested, fans may increasingly look to VR platforms to simulate the stadium experience. Over the course of a few weeks in mid-March, hundreds of major live sports events dropped from US television programming schedules, as virtually each major US sports league indefinitely suspended, postponed, or canceled its season due to coronavirus concerns.
To fill the live-sports vacuum, traditional leagues and broadcasters are hosting virtual replacements like game simulations. Fox Sports partnered with NASCAR and iRacing to broadcast the first-ever eNASCAR iRacing Pro Invitational Series event, with virtual race events attended by virtual fans. The inaugural broadcast on FS1 drew 903,000 viewers, and 1.34 million viewers on the March 31 broadcast on Fox and FS1 — each respectively setting records for esports viewership on TV, per Nielsen. And when sports do return without fans, VR could be the perfect medium for broadcasters and sports teams to deliver content that mirrors the in-person experience.
Apple has long been rumored to be working on a combined AR-VR headset that could launch as soon as 2021, according to Bloomberg. And while Apple’s specific intentions for NextVR are not yet clear, the purchase certainly aligns with Apple’s long-term ambitions to become a major player in the XR ecosystem, as well as a dominant force in the entertainment industry.
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