High Fidelity changes direction (2)

In April 2019, as I reported in High Fidelity changes direction: the reality of VR worlds today (& tomorrow?, Philip Rosedale announced that High Fidelity would no longer be sitting within the content creation / public space provisioning area, and would instead switch to focus on software / platform development. This announcement has now been followed with a blog post by Rosedale that expands on the company’s immediate plans for the future.

In the May 7th, 2019 post Rosedale indicated that the company is shifting its emphasis even further and will be downsizing its workforce by 25% (some 20 people) in the process. The blog post is brutally honest – kudos to him for being so open – and its commentary gave me pause to mull a few things over before offering any lay thoughts of my own.

In stating the reason for the change, Rosedale points to the lack of take-up of VR headsets:

If you had asked me when we started the company in 2014, I’d have said that by now there would be several million people using HMDs daily, and we’d be competing with both big and small companies to provide the best platform—but I was wrong. Daily headset use is only in the tens of thousands, almost all for entertainment and media consumption, with very little in the way of general communication, work, or education.

– Philip Rosedale, Toward A Digital World, May 7th 2019

On the one hand, for those of us who never brought into the whole “VR will be a US $70 billion a  year business by 2020” simply on the basis of the “gee whiz” factor ascribed to it, nod knowledgeably and mutter, “told you so”. But this would rather miss a good portion of the point. As I’ve also pointed out in these pages, VR could in time come to have an impact on our lives in a variety of ways, and there are markets available today that could be – dare I say – revolutionised by its presence.

The problem is, no-one has yet found a way to substantially break into those markets for a variety of reasons. Take education, for example (a big focus for High Fidelity in the past): yes, VR could revolutionise teaching in many areas, but until the cost of headsets has come down substantially to the point where schools can afford to equip a class of 25-30, until questions of controlled access and the provisioning of virtual environments for schools and colleges to access (or build for themselves), the widespread integration of VR teaching remains a horizon vision.

However, when it comes to the broader metaverse in particular – the starting point of Rosedale’s blog post – VR is really just one component. As he notes, since its inception, High Fidelity has worked hard on many of the foundational requirements for a broader framework in which to set “the metaverse”.

We’ve been working as a company for six years now writing open-source software and creating test events and experiences to enable this imagined place to come into existence. We’ve created a 3D audio engine that can handle large crowds, an open-source graphics engine with live editing, scalable servers, a blockchain-powered currency and marketplace, and more.

– Philip Rosedale, Toward A Digital World, May 7th 2019

Could it be that, moving the focus of VR headsets off to the side until they do gain real, broad-based market traction, some of this additional technology, combined with what had already been achieved through non-VR centric 3D spaces, demonstrate real world uses cases business (and others) might want to adopt? And in doing so, might this further lay practical foundations for wider acceptance of the concepts inherent in a “metaverse” type of setting, one that could in time also more naturally offer VR HMD support if / when the latter does start to become more a part of working environments?

That’s what High Fidelity is now setting out to explore, by delving into the idea of a virtual workspace solution.

For two weeks, we sent everyone home, with their computers, and created a private tropical island where we could work together all day, mostly wearing headphones but not HMDs—we didn’t prescribe the medium of use.

Within the first couple of days it was obvious we were onto something. The 3D audio was always on, perfectly realistic and comfortable. We found ourselves walking around and interacting with each other the same way you would in a physical office. We put up whiteboards and spaces for teams … What if the general trend toward remote and distributed work … could be accelerated even faster by virtual worlds?

– Philip Rosedale, Toward A Digital World, May 7th 2019

Again, for those of us who have been around long enough, this approach might ring a bell. Back in 2008-2010, another company Rosedale founded (but had since departed in an active capacity) tried a similar idea through a product called Second Life Enterprise (SLE), designed to provide companies with a “behind their firewall” implementation of a Second Life based virtual environment for collaborative working.

That idea ultimately failed – although it’s fair to say the reasons for that product’s failure were potentially more rooted in how it was implemented and the walls Linden Lab placed around it to (presumably) protect their IP than in any disinterest in the concept of virtual work spaces or sleazy associations appended to SL itself. And times have moved on a good deal since then; if nothing else eight years on, people are now more au fait with things like virtual spaces, avatars and the like to potentially be more open to virtual working environments.

So time will tell if this new approach works for High Fidelity – again, Rosedale admits there is no certainty in the move. But after six years – most recently with a lot of effort poured into high-profile events – High Fidelity is still struggling to grow an audience, and it really wasn’t clear if anything would substantively change in the next six years if they kept on that road. As such, this a brave move for a start-up to take, and a dose of realism when it comes to the state of play with the VR market. And in the meantime, as the blog post also makes clear, High Fidelity will continue to support its open source VR platform.

Which leads to a final question. Is this a sign that more VR-centric virtual spaces could face some hard decisions? Quite possibly. High Fidelity actually isn’t the first to hit the wall of slow VR take-up. In 2017, Altspace VR announced its imminent closure, but was ultimately saved when Microsoft stepped in.

But again, caution should be exercised if tempted to see this as a sign of the future for something like Sansar. If nothing else, the latter doesn’t have the weight of US $73 million investment sitting on its shoulders, quietly demanding the way be shown towards some kind of future return. Plus, Linden Lab have a viable source of income through Second Life, a platform they are committed to continue to develop and (hopefully) grow. If nothing else, this allows them the potential to throttle / steer the development and growth of Sansar to meet the realities of their potential marketplace without the worry of external pressures.

In the meantime, to High Fidelity, one can only say “good luck” with the new endeavour, and it will hopefully be interesting to see where it leads.