Tan Zheng (left), founder and CEO of ANTVR, experiences a VR headset at the Boao Forum held in Hainan Province on March 25 (XINHUA) 

The boom of online shopping has shifted the consumption habits of tens of millions of people over the past decade or so, from going to traditional brick-and-mortar stores to browsing on computers or smartphones. But now Taobao.com, the largest online shopping platform in China, is planning to push customers back to the shops—virtual shops, that is.

On April 1, Taobao announced the launch of a brand new shopping method, "Buy+," to arrive in four months' time. A video introducing Buy+ was released as part of the announcement scheme showcasing the new concept. The idea is that online shoppers can enter an interactive 3D shopping environment, via a pair of virtual reality (VR) glasses. In the shops, customers can "touch" the products, "try" on clothes, and pay bills.

"The video is too legit to look like an April Fool's joke," said Liu Guangyu, a 30-year-old Beijing resident, while sharing the video on the popular WeChat application. What excited Liu most, as a big fan of Japanese cosmetics, was the glasses' ability to instantly transport her to Tokyo's shopping malls. "I am afraid I can't stop buying with these glasses, it looks thrilling!" she exclaimed.

This appears to be just the reaction the company was looking for: "It's like opening Pandora's box," the video caption itself said, "and it can almost activate all of a person's purchasing desires."

"I never worried about market prospects or technological bugs with Buy+," joked Xie Tao of the marketing team of Buy+ in the introduction video. "I just worry that my wife will max out all my credit cards with it."

Virtual or real? 

The Pandora's box was not only opened by Buy+, but by the whole VR industry. Even the popularity of the word "VR" seemed to happen so suddenly in China that many people have been saturated with VR news and products, before they're even aware of what VR really is. Even after finding out that VR is an acronym for "virtual reality," it still sounds too obscure to get a clear understanding of this new technology.

But for many insiders in this industry, this is not a new word. The Matrix, a movie released in late 1990s, might offer a good reference. Lana Wachowski and her sister Lilly Wachowski, commonly referred to as the Wachowskis, directed the revolutionary 1999 science-fiction film, which delivered a vision of VR in which users accessed an entirely convincing rendition of the real world by plugging their own bodies into machines.

The word VR appeared in science fiction much earlier in fact— in the 1950s. It was later developed for medical use, pilot simulation and military training in the 1990s.

In August 2012, the American virtual reality technology company Oculus raised funds for a VR headset, which was supposed to offer an immersive experience for computer gamers. The project collected $2.5 million, and in 2013, the developed version of the headset was released and sold for $300 each.

High-end VR technology thus came to the general public's attention with the relative affordability and fresh experience it offered. In March 2014, the California-based Facebook company announced the purchase of Oculus at the price of $2 billion, catalyzing an industry-wide rise in investment and the research and development of new products.

China's VR market followed soon after. "China started to pay attention to the VR industry in 1995. But at that time most of the research and development was focused on the B2B (business to business) sector or to professional projects within the industrial field," Weng Dongdong, an associate professor at the Center for Research on Optoelectronics, Information Technology and Color Engineering at the Beijing Institute of Technology, told China News Service. "It was not until the last two years that the industry has tapped the B2C (business to consumers) sector."

The Asian market is catching up quickly. Figures from iiMedia Research Group, a leading organization focusing on data mining and analysis, showed that in 2015, when the VR industry saw real opportunity in China, the market scale was reported to be 1.54 billion yuan ($237 million). In 2016, the number is expected to be 5.56 billion yuan ($855 million), while in 2020, the number is projected to surpass 55 billion yuan ($8.46 billion), almost 10 times of that in 2016.

Chen Zhaoyang, CEO of Shanghai-based Le Xiang Technology Ltd., a domestic consumer-focused VR manufacturer, has been working in the VR industry for 10 years. In 2006, when Chen introduced VR to potential clients, he had to carry a big Intel central processing unit, also known as CPU, and a mobile display screen. While demonstrating computer games with such equipment, he often had to face awkward and unexpected jolts in performance as the game wouldn't always run properly.

"Now it is totally different," Chen said in an interview with Ifeng.com, a news portal website. "The fast hi-tech development has largely lowered the cost of VR equipment and virtual reality has finally intruded into actual reality."

 

A visitor at the China Hi-Tech Fair held in Shenzhen, Guangdong Province, plays computer games with a pair of VR glasses on November 19, 2015 (XINHUA) 

The new market 

Even so, the core VR technology is still at a nascent stage. Searching on Taobao.com, the price of VR headsets varies from less than 10 yuan ($1.53) to several thousand. "The VR boom has made the market more chaotic," Chen said.

A report released in September 2015 by Shanghai-based Interface News showed more than 300,000 VR headsets have been sold every month through Taobao and its sister-company Alibaba. Lower-cost headsets have accounted for the bulk of the sales, as there are more than 100 types of virtual reality headsets being manufactured in China.

"A qualified VR headset needs to allow users to view the virtual world clearly, without feeling dizzy," said Ma Jiesi, VR Manager at HTC, at an online forum on March 15. To achieve this, costs will not be low. Ma revealed that currently there are only three companies (Oculus, Sony and HTC) that can produce such products: "The cheap ones sold at Taobao can't meet such requirements," he said.

Most notably, Ma predicted that "VR is just the first step of a whole set of virtual worlds, after VR, we will have AR, which stands for augmented reality and then MR, the acronym for mixed reality." He explained that VR is the full screen of a virtual world, while AR will be based more on the augmentation of the real world through virtual elements. MR is a mixture of both the real and virtual world.

He also claimed that VR and AR equipment will be the computing platform of the future. "We can go as far to say it might be the last generation of computing technology, replacing smart facilities including computers and smartphones," Ma said. "The era of MR will definitely arrive, but it will take a long time."

Dubbed as the First Year of VR, 2016 witnessed the hype around these technologies in China. VR cameras and photo shootings were taken during the reporting of the annual two sessions—the Fourth Session of the 12th National People's Congress (NPC) and the 12th National Committee of the Chinese People's Political Consultative Conference (CPPCC) in March. VR even became a hot topic at the Boao Forum held a few weeks later in China's Hainan Province.

"I believe VR will be the next wave following the Internet and now many industries are exploring the possibility of connecting their business with this cool new technology," said Tan Zheng, CEO of ANTVR, a startup company focusing on VR development, at the Boao Forum.

Meanwhile, hundreds of VR clubs have sprouted up in places across China. By spending less than 100 yuan ($15.15), customers can experience a "whole new world" by just using a VR headset. Real estate companies can also adopt the technology, allowing potential buyers to view new homes from the other side of world. The Strawberry Music Festival, one of the most popular music events held every year in Beijing, also announced that it would use VR technology for its live broadcast of the event, which lasts from April 30 to May 2 this year.

Seeing is believing? 

"The goal of this industry is to make the virtual world as real as possible, until it feels exactly like the real world," said Ma. Part of the market's attention, according to Ma, lies in the dissatisfaction many people have toward their real lives. They want to go to a virtual one as an alternative, and one that computers, tablets or mobile devices cannot provide.

Still, Song Fei, who is in charge of VR department of Letv, an online video portal in China, is keeping a cool head about VR development. "To view VR videos, viewers must wear headsets or glasses, but the quality of such products is a real concern and many can't perfectly display what the videos intend to show," Song told China News Agency. Song also noted that "the popularity of such products needs to be supported with abundant video content."

Many VR clubs have proved that Song's concerns are not groundless. After the initial months featuring waves of customers, the businesses have started to see a drop-off, as there is currently quite a limited range of videos that can be provided for VR headsets.

"In the real estate market, the function of VR technology can truly attract more customers, but when purchasing a house, the house itself is just a small part of one's considerations, one also needs to know the whole environment, including neighborhood, transportation, etc. This can't be shown in VR videos," Zhao Xueyan, a real estate agent who has been working for more than 10 years in Beijing, told Beijing Review on March 16.

Apart from technological issues, Tong Dawei, a popular Chinese actor, is more concerned about the cultural aspects. "Although VR technology is fascinating, it still can't be compared to real life," he said at the Boao Forum. "The smartphone has already revolutionized our methods of communication." Tong also referenced a popular saying, "The farthest distance in the world is when I sit next to you, but you're on your phone."

"The changes which VR can bring to our life are still uncertain," Tong cautioned. "I don't want my kid to stay in a virtual world; no matter how good it is, he would have very limited memories of the real world."

Copyedited by Dominic James Madar and Mara Lee Durrell

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