Samsung gamble to push VR on the masses may prove Note-perfect

25 Aug 2016

With the Galaxy Note 7 released to promising reviews, Gear VR set for a big 12 months and the S series finally giving Samsung a flagship smartphone to shout about, the company is poised for an interesting future.

At the Irish launch of the Galaxy Note 7, Samsung revealed that, for a limited time, the Gear VR headset would come free with the purchase of the company’s latest phablet.

An odd pairing on the surface, the decision was actually a sound one. Ahead of what many feel is a virtual reality revolution, getting devices into consumers’ hands is priority number one for many companies.

Samsung VR

Futures made of virtual insanity

The industry is expected to be worth $160bn by the end of the decade, so Samsung’s logic of bathing the market in its own devices seems logical. However, the strands drawing in new customers may be a little surprising.

Pricing headsets at around €100, Gary Twohig, director of Samsung Electronics Ireland, told how the S series of smartphones has actually proved the driver for interest, with VR capabilities acting as its main appeal of late.

“The software and tech is on the phone. We’ve got a lot of people switching over to us from competitors’ phones for this reason,” he claimed.

“They want to be able to use the capabilities on our flagship smartphone, that’s what is driving the VR. People want the S7 and S7 edge, of course, but people are also switching phones just to get that VR capability.”

Gary Twohig, director, Samsung Electronics Ireland. Photo: Chris Bellew / Fennell Photography

Gary Twohig, director, Samsung Electronics Ireland. Photo: Chris Bellew / Fennell Photography (additional editing

There are divergent paths being set by companies looking to get on the VR bandwagon. Some are going down the cheaper headsets route, fixing in smartphones already souped-up with VR-heavy software. Think Google. Think Samsung.

Other companies, though, are putting more of an emphasis on the headset as a standalone device. Think HTC. Think Oculus.

For Twohig, there’s only one way to do this. “The central device is the smartphone,” he said, for both the internet of things (IoT) as well as virtual reality markets. “Who knows what VR will look like next year or in two or three years?” he said.

“It is going to change, adapt, become more powerful. As our phones become more and more powerful, what you can experience improves with it.”

The Samsung Galaxy Note 7. Image via Samsung

The Samsung Galaxy Note 7. Image via Samsung

Hard to know where to begin

At the moment, Samsung’s VR business model is not limited to initial, ephemeral interest in the new. It involves enterprise, too, though even this is a stab in the dark at this stage.

Twohig said he thinks the next few months will see a surge in interest in VR, with the general public mainly looking to investigate the latest oddity. However, though it starts with entertainment, and probably finds a home in gaming, the subsequent extrapolations in VR are what interests him most.

“When people try it, ideas will emerge. Look at our partnership with Sherry Fitzgerald,” he said, noting the Gear VR headsets adorning estate agents’ offices throughout the country.

“You get the initial consumer experience and then people have ideas on how they can extrapolate this. Leave it to people to have great ideas. It is going to change.”

Everybody loves gifs, right? Galaxy Note 7. Image via Samsung

Everybody loves GIFs, right? Galaxy Note 7. Image via Samsung

It’s a wonder

Though as the market changes, so too does the customer. Twohig said the reason the Note 7 exists, despite being similar to the S range of smartphones, is the consumer demand.

When the Note 5 failed to emerge here, 50,000 people signed a petition calling for its release in the UK and Ireland, according to Twohig. So the series returned.

The Note 7 has a few cool tools, the pen, the ability to jot down notes with one or two steps, and the easy way to create GIFs is pretty cool, too.

It’s not a cheap device, though. Pre-orders at the moment see it come in at several hundred euro on long-term, premium, bill-paying contracts. One has to wonder how a company can sell so many different, costly devices, ahead of an explosion of further IoT sensor-heavy gadgets in the near future.

Oh, this world, has got to change

For the past few years, the contracting model has worked. With the dawn of the smartphone, consumers in the UK and Ireland followed US footsteps and began buying contracts one, two or three years long to finance a device as well as a service.

Though as these devices are improved upon every six months, with the potential for something similar in an IoT scenario, can this model truly satisfy the public in a connected future? Given the growth in subscription-friendly streaming services, perhaps.

Contracts are a financing route for people, rather than paying up front for a device, they spread the cost. This is just for now, though, as Twohig thinks change is afoot.

“That’s changing,” he said. “People are more savvy, they are looking at the total cost of devices and contracts and putting that all together. Companies know this and they are offering bundled contracts or unbundled variants.”

Predicting a lot more consumer financing options, the dramatic drop in the price of peripheral devices will be key.

“The central device, the smartphone, will remain [a cost]. But the devices around that will get very competitive in price. Look at the Gear 360, to get that tech last year would have cost thousands of euro. That’s a few hundred now.

“It’s improving fast. Banking is changing, finance is changing, how people will pay for things will change, too.”

Main Samsung Gear image via catwalker/Shutterstock

Gordon Hunt was a journalist with Silicon Republic