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Why Owlchemy Labs is Predicting a Bright Future for VR and Mobile Games

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Alex Schwartz, founder of Austin, Texas-based Owlchemy Labs, has a bold opinion about mobile virtual reality: It has a big future, but game developers are playing a waiting game. Why? Smartphone technology hasn’t yet evolved enough to unleash the full potential of VR.

Still, Schwartz’s little studio is thinking big about virtual reality. And it’s not wasting time: Owlchemy’s Caaaaarboard! is currently the top-selling mobile VR title on Google Play. Schwartz believes this recent success is the first of many for his studio. Owlchemy, he says, is playing the long game with VR — a market worth an estimated $30 billion by 2020.

Of course, this is just one company’s bet. They could be on to something like the early adopters of the App Store or it could be slow going — a la Google Glass. Either way, VR for mobile games, is the “next big thing” everyone’s talking about and Owlchemy is excited to explore it.

An unexpected start

Alex Schwartz, Owlchemy Labs

Owlchemy Labs founder Alex Schwartz. Image via Lauren Ellis

Owlchemy got into VR almost by accident. Already big fans — and Kickstarter backers — of the Oculus Rift, the team spotted a report a few years ago on gaming site Kotaku that announced a VR version of AaaaaAAaaaAAAaaAAAAaAAAAA!!!, a base-jumping game for PC that they’d worked on with indie dev crew Dejobaan Games. “[Kotaku] said, ‘Oh, it’s in development,'” says Schwartz, “and we said, ‘Wait a minute, what the fuck?'”

The article’s comments all praised the idea, though, so Schwartz’s team decided to actually build it. “We released it on Oculus Share, and it ended up being the most downloaded game for about 12 months,” he says. They later remade it for mobile devices — implementing gaze controls to replace mouse and keyboard inputs — in the form of Caaaaarboard!.

Those initial steps highlighted Owlchemy’s potential as a VR studio and helped them connect with the major VR platform holders, including Valve, Oculus and Sony. When Schwartz tried out a demo of Valve’s Vive headset behind closed doors, he had what he describes as an almost religious experience. “That kind of sold us on the long-term future of wanting to do virtual reality,” he says.

Caaaaarboard! for Android.

Caaaaarboard! for Android. Image via Google Play

Tomorrow’s technology

Schwartz thinks that mobile VR technology will catch up with current desktop solutions in the next year or so. And when it does, he says mobile has the potential to far exceed what’s currently only possible on expensive, high-end PCs.

“It’s an inevitable thing that will happen,” he says. “Our phones will be basically five times faster than the insane liquid-cooled rigs with 980 GPUs that we have currently have at $2,000 a PC.”

He even thinks that mobile VR headsets will soon become a regular part of your phone package: “Having that untethered experience with no wires is definitely a superior experience and it’ll open up the doors to really great consumer adoption,” he says.

Schwartz runs a VR development group in Austin with around 500 members and tells me that the group is pretty much split in its opinion on desktop versus mobile VR.

“I’d say there’s a healthy mix between people who believe in desktop VR — what you would call the really high-end enthusiast market where you’re going to have a whole room dedicated to VR. Then there’s a large portion of people who are focused on the bottom-up market — Google Cardboard, Merge VR, Gear VR. They think that will get VR headsets into people’s hands faster and quicker.”

Schwartz just thinks that VR needs to be done right, whatever the platform, but he believes people’s first VR experience should really be the full desktop experience.

“You can’t come out of your first VR experience — like, a desktop VR experience — without either being speechless or hugging the person who gave you the demo,” he says. “I’ve seen people in tears afterwards; it’s an absolutely amazing experience.”

Monetizing mobile VR is still slow going

When it comes to monetization, PC may still be the frontrunner. There’s no way to make in-app purchases in a mobile VR game right now as Google’s operating system doesn’t support it. And while no one’s putting interstitial ads in their mobile VR games yet, Schwartz thinks both will be possible soon enough.

That currently leaves the option of either charging for your game or not. Owlchemy chose to charge for Caaaaardboard!, and I asked Schwartz how that played out.

“We have the top-selling mobile VR game on Google Play,” he says, “… [but] lets just say I’m not buying drinks at the bar for everyone.”

Schwartz is pragmatic, explaining that selling to early adopters is a limited market.

“It’s not a consumer market yet,” he says. “The only people we’re selling to, honestly, are really crazy enthusiasts and devs. While we’re not making money now, we’re setting ourselves up for a longer-term cash flow.”