Samsung will take on Oculus, Vive with high-power VR rig

Gear VR is only the beginning of Samsung's virtual reality ambitions.

The South Korean company has made a big bet on mobile virtual reality, bundling its Gear VR headset with its flagship phones to get people familiar with the technology. Once again, consumers who preorder its newest phone -- in this case, the Galaxy S8, unveiled Wednesday -- will get the latest Gear VR and remote control for free.

But Samsung's also developing high-end standalone headsets that work with PCs and is targeting "professional" markets such as media producers and pro gamers, said Lee Young-hee, the executive vice president who oversees marketing for Samsung's mobile business.

Watch this: Samsung shrank its 360-degree camera but the improvements don't stop there

01:18

"We have two tracks" for VR, Lee said in an interview in South Korea two weeks before Samsung unveiled the Galaxy S8 and S8 Plus, an updated Gear VR headset and new Gear 360 camera. "First of all, let's democratize this new demand ... [and] make it part of our smartphone experience."

She declined to specify what Samsung's standalone VR headset will be like "because it's still under construction." It's unclear if the device will have to be tethered to a PC or if it can be used entirely on its own. But a year ago, Injong Rhee, head of R&D for Samsung's software and services, said Samsung wants to give users the full Star Trek holodeck experience, the ability to roam around and touch objects and use motion tracking and gesture tracking.

The project would put Samsung in the same field as Facebook's Oculus Rift and HTC and Valve's Vive -- full-blown (and expensive) rigs that use sharper graphics, more horsepower and the ability to track movement for a more immersive experience. Samsung is one of many tech giants, from Google to Sony, that believe VR's ability to transport us into new worlds is the next hot trend.

Samsung is certainly hoping so, especially as a malaise sets in on phones. (They're all great, so what?) The company is looking at everything from its smartwatches to its home appliances to get people excited about its technology. VR plays a prominent role in that strategy.

Virtual reality companies are expected to ship 99.4 million VR headsets in 2021, up from 10.1 million last year, according to data tracker IDC. The firm noted that demand in 2016 came from "technology enthusiasts" but that more people are starting to see the benefits.

"This sets the stage for the multiple aspects of the market that device makers, platforms and content providers, and developers will be addressing in the months and years to come," said IDC analyst Ramon Llamas.

Democratizing VR

Samsung was one of the early entrants to virtual reality through its partnership with Facebook's Oculus. With Gear VR, you slide a newer Samsung phone into the headset to launch games, videos and other content. As of late 2016, there were 5 million Gear VR headsets in use globally, and people had watched more than 10 million hours of video through Gear VR.

"The reality is mobile is the mainstream flavor of VR for now," Jackdaw Research analyst Jan Dawson said. "It's a lower quality version, less capable and less powerful because of the computing power behind it, but it's the version that will reach many more people."

The newest version of Samsung's headset, which comes with a controller, costs $129.99. Consumers can also buy the controller on its own for $39. Samsung will give the Gear VR and remote control for free to anyone who preorders the Galaxy S8. The phone and new headset will hit the market April 21.

Samsung's aim with its VR headset price is to get more people using it and, especially, to sell more phones. Its Gear VR headsets won't work without Samsung's newer phones, and its first Gear 360 camera only synced with Galaxy devices. The second version of its camera, unveiled Wednesday, will work with Apple's iPhones and Macs, but no other Android devices beyond those from Samsung.

"I think we accomplished what we wished to," Lee said of getting VR into millions of people's hands.

Look Ma, no cords

Mobile VR might be the main consumer option right now, but there's concern that the lower quality experience could actually hurt the market.

Qualcomm, which makes the chip that powers the Galaxy S8, has shown off a VR headset that bridges the gap between cheaper mobile VR headsets like the Gear VR and the high-end systems. It's a demo unit designed to inspire vendors looking to build their own VR devices and could be a hint to what Samsung is working on.

But even with more powerful systems, VR still faces the classic chicken-and-egg dilemma. There's not enough content yet to convince consumers to buy a device, with only a sprinkling of experiments so far like watching a basketball game or taking a tour of Mars. But there aren't enough users to convince companies to invest in more content.

VR still needs two primary elements to become mainstream, said Koh Dong-jin (who is better known as D.J. Koh), head of Samsung's mobile business. Those are content and ease of use. For the former, Samsung is working with partners, as well as updating the Gear 360 to make it easier for people to create their own videos and photos.

Samsung hasn't yet revealed the price of the new Gear 360, but Koh said it will be "very affordable." The first generation cost $350.

The company is also committed to simplifying the whole VR experience. "The second version of Gear VR is, I would say, very, very easy to use at the moment," Koh said in an interview in South Korea.

Dabbling in AR

Samsung's been early with VR, but it hasn't said much about the technology's counterpart, augmented reality. While VR transports you to a different world, AR displays a virtual world on top of the real one. A good example of the technology is Pokemon Go, which lets you catch digital monsters jumping around in the real world on your phone's screen.

Several companies have been working on AR, including Microsoft with its HoloLens AR goggles and Osterhout Design Group's R-8 and R-9 glasses. So far, the two biggest companies in mobile, Samsung and Apple, haven't made any moves in that market. Apple CEO Tim Cook has expressed his interest in AR many times, and the next iPhone expected later this year is rumored to include the technology.

Koh said Samsung's interested too, but it's not releasing the technology anytime soon.

AR "will be the next big step," he said. "We're under preparation a lot. To provide as a commercial product, we may need more time. It won't be too late."

Virtual reality 101: CNET tells you everything you need to know about VR.

Special Reports: CNET's in-depth features in one place.