VRstudios Featured in 425 Business Magazine


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VRstudios Featured in 425 Business Magazine

Words by Jake Bullinger
Photos by Rachel Coward

The goal of media, Charles Herrick tells me, is to suspend reality. A creator attempts to pause the consumer’s real life with a compelling documentary, a riveting novel, or a binge-worthy television show. For a few moments earlier this year, Herrick suspended my reality by placing goggles on my head, a fake pistol in my hand, and then making me fight off a horde of virtual zombies.


My battle with the undead took place at the Bellevue office of VRstudios, of which Herrick is CEO. Inside a trussed 15-by-18-foot space rimmed with eight cameras that tracked my motion, I was firing at zombies that emerged from glowing red catacombs beneath a 19th-century London alleyway. As zombies are wont to do in shooter games, they came at me with increasing frequency; soon, I was surrounded.

I fired away, blood splattering in viscous red streams. (The experience is a bit visceral — a customer in Dubai asked the zombies’ blood to be colored green.) I was rapidly spinning in circles as the zombies came from all directions. When they were close enough, I instinctively pulled back my arm to keep from touching beasts that weren’t really there.

After I finished playing Time Zombies, the flagship game of VRstudios’ entertainment subdivision, VRcade, Herrick’s team loaded up a far more pedestrian scene: a South Lake Union condo. I was given a 15-by-15 space to walk around; moving throughout the entire condo required me to teleport using a handheld cursor. I pointed the cursor at the wall, clicked a button, and the wall color changed; the same happened with the flooring. Red, green, purple. Carpet, tile, hardwood. With the touch of a button, I could change the modern art that didn’t mesh with the room’s flow to a mirror that made the space seem much bigger.

The sequence in which I experienced VRstudios’ products mirrors the sequence in which the company plans to grow. Entertainment is its business thus far. Herrick said 70 to 80 percent of revenue in 2016 will come from arcade systems (one can find VRcade setups at select Dave and Buster’s arcades) and under-development cinematic experiences. The company has secured tens of millions of dollars in contracts, Herrick said, primarily in France and China.

But in five years, Herrick expects enterprise applications to make up the bulk of the company’s revenue. The condo model I saw could be used by a landowner to show off properties to customers, a home builder to allow customization, or a retailer to let a customer see how products will look before buying them. Design firm Teague uses VRstudios’ technology to simulate aircraft interiors. Other companies across the Eastside and the rest of the Puget Sound are following VRstudios’ footsteps into the nascent virtual reality sector. The technology is having its first major resurgence since it flopped in the early 1990s, and many believe it could be as disruptive as the smartphone. But for VR to become a transformational medium, for its suspensions of reality to weave into our everyday lives, it needs to handle the more mundane everyday tasks as well as it handles shoot-’em-up zombie games.

“If all of this is just a viewing experience, then we haven’t solved the problem of VR,” Herrick said. “It has to become a tool to solve other problems.”






BY MOST ESTIMATIONS, the next big test for VR begins this spring, as top-flight headsets become available to consumers. One of those head-mounted displays is the Vive, built by HTC, which moved its U.S. operations from Bellevue to Seattle in late 2015, in concert with Valve.

Valve was an early mover in this latest wave of VR. The game maker and operator of the Steam distribution platform built a room-scale prototype in its Bellevue headquarters. Valve’s demo room quickly became known as the top VR showcase in the country, and developers and executives from around the world were paraded through. One of those executives was Cher Wang, HTC’s CEO, who dropped in from Taiwan in early 2014. “Their original solution was moving around, walking around in VR, and that just felt so much more natural,” said Dan O’Brien, HTC’s vice president of Vive. “So when our CEO met Valve, she saw that, if we’re going to do VR, this is where we’re going. We were working together within weeks.”

In an incredibly brief and collaborative process (of the intellectual property relationship between Valve and HTC, O’Brien said, “It’s a really strong partnership, I’ll tell you that much”), the two companies built the Vive, the lone consumer headset coming out this year that operates at room scale, meaning the user can walk around the virtual space instead of navigating with a controller. It’s a goal straight from Star Trek. “This is the holodeck — putting people in the middle of the content and not looking at it like it’s a museum or from a seated position,” O’Brien said. When the Vive is released in April, Valve will pump content through its SteamVR store.

The Vive will have headset company. Samsung’s $100 Gear VR already is available, and the Facebook-owned Oculus Rift ($600) will start shipping in late March. Later this year, Sony’s PlayStation VR and Microsoft’s HoloLens, the lone augmented reality headset in this first flight, are expected to be released, and Google is reportedly working on a standalone VR product. Display makers have been on a publicity blitz. “Our convincing argument is putting people in the headset,” O’Brien said. “We put game developers, we put your mom and dad, your grandma, your kids — we put everybody in this headset, and they come out with this sense of joy and entertainment.”

If seeing is believing, VR’s previous flirtation with consumers didn’t instill much devotion. In the early 1990s, huge VR rigs in arcades weren’t enough to wow gamers, and they were expensive — an arcade that bought a top-flight system would need customers to deposit some 300,000 quarters to recoup the investment. Furthermore, other mid-’90s innovations like the Internet monopolized consumer attention.

VR’s second take appears to be happening at a more opportune time, though. Critical technological advances not only make headsets like the Vive possible, but they also make them more affordable to build and distribute.

The reason for this is in your pocket. Over the years, smartphone makers battled to create phones with high-resolution screens and stuffed with GPS sensors, accelerometers, and Internet connectivity — all ingredients fueling the VR revolution.

“Fundamentally, your 3D virtual reality headset is a combination of smartphone parts bolted together in a piece of plastic you can stick on your face,” said Trond Nilsen, who heads up the VR division at RATLab, a Seattle research and development firm that contracts with area VR companies, including Bellevue-based Envelop VR.

VR software is much easier to make than it was in the ’90s thanks to 3D game engines, particularly those from Unreal and Unity Technologies, that were popularized by mobile gaming. “Now, a middle schooler can download (a 3D engine) on their computer for free, and in an hour have their own little game that might have been a million-dollar game 15 years ago,” said Forest Gibson, a founder of Pluto VR.

Computing is undeniably better than it was in the 1990s, but there’s another, and arguably more critical, component behind VR’s renaissance — clout. There was no talk of Microsoft entering VR in the ’90s; now it has HoloLens. Google led a $542 million investment round in augmented reality company Magic Leap, Apple has poached top VR researchers from universities and purchased VR firms, and Facebook spent $2 billion to buy Oculus.

VR’s captivation of indie and corporate developers alike has catapulted the technology across a critical threshold — it works. Only the queasiest of stomachs could get motion sickness in today’s headsets, and the demonstrations available ahead of ship dates really are impressive








VRstudios CEO Charles Herrick
wearing the VRcade headset.


One demo puts a Vive wearer on the hull of a sunken ship as a blue whale swims by. The whale really appears to be 100 feet long, its eye big as a dinner plate, and it grumbles a throbbing bass that’s distinctly aquatic. There are VR jet packs, roller coasters, and scary films that are more tense than their fixed-screen, two-dimensional counterparts. Shooting games are hilariously fun, and the potential for gaming as a whole is obvious.

Still, VR’s not flawless. The high-end headsets are tethered to a PC, and most PCs can’t meet mettle. Graphics-chip maker NVidia estimates only 13 million current PCs — less than 1 percent of the global total — are beefy enough to run VR. On the content side, people are barely scratching the surface; nobody knows how to make a feature length VR movie yet.

But it’s still early days. Headsets will shed bulk and their umbilical cords. Graphics capabilities will improve, and developers will learn how to produce better content. All this will happen — if people are willing to buy VR.

THE VR MARKETPLACE begins at the game studios. Game designers know better than anyone how to guide users through a 3D setting. As a result, video game firms see themselves playing a larger role in the VR landscape. “Our sweet spot is in games, but, in terms of authoring, we’re taking an agnostic view,” said Tony Garcia, Unity’s chief revenue officer, said in the company’s Bellevue office. “Instead of games, we call them experiences.

An experience can be a game, but it can also be a virtual tour of a museum, or training on how to rebuild a Boeing engine.” That sentiment has businesses across industries knocking on game designers’ doors. “I go to Game Developers Conference most years … and I tell people I’m a builder, and they’re like, why are you here?” said Greg Howes, CEO of Ideabuilder and an active member of the area’s VR community. “So I say, think about the gaming technologies and what are used when you’re simulating cities. Shouldn’t that be how we’re designing real cities? Shouldn’t that be how we’re exploring buildings and communities before we construct them?”

Bob Berry understands the intersection of games and virtual reality. He studied virtual reality in graduate school, and in 2008 founded his own game-development firm, Uber Entertainment. Six years later, Berry was finally confident the VR bandwagon had secure wheels, but the game-industry exec didn’t choose to fold VR into his current field of expertise. Instead, he founded Envelop VR, a company devoted to enterprise software.

The company’s product, the Envelop Virtual Environment, or EVE, lets the user position multiple windows in what amounts to a columnular environment. The software optimizes two-dimensional programs for a three-dimensional virtual work space. It’s not totally intuitive — when I played with Web browsers and Excel in EVE, I had to focus on utilizing extra space instead of staring straight at the position my physical monitor would occupy — and the column, which lets you position windows so high you can’t see them, feels quite narrow.

But it’s important when using current VR programs to envision what they could become. Envelop’s first edition of EVE, set for release in April, appeals to folks who could trade multiple monitors for one Oculus Rift — think stock traders, security guards, data analysts. But expand the EVE column, implement room-scale VR, and throw in avatars of coworkers, and you have a virtual office.




VRstudios gives people the capability
to tour homes in virtual reality, a major perk
for firms with international clientele.


“As these technologies mature, and we start having collaborative spaces to allow people to work together in VR, we’ll see the number of companies able to work remotely increase,” Berry said. “If that number increases … it will be massively disruptive for the commercial real estate industry.

It could improve commute times because less people actually need to go into the office.” Matt McIlwain, managing director of Madrona Venture Group, which led Envelop’s $5.5 million Series A round, agrees that the ability to transcend geography is a major selling point for VR.

“I could see, I don’t know, five to seven years from now, the following experience: My daughter is in college; she lives on the East Coast,” McIlwain said. “We like to go for jogs together when we’re in the same place. Wouldn’t it be fun for me to be on a jogging machine in Seattle, she’s on hers in New Hampshire, we both have our VR headsets on, and we’re jogging together? And, we’re jogging in the same place. That place could be Maui.”

Herrick, the VRstudios CEO, believes that as enterprise clients are exposed to VR, it will become an invaluable cost-cutting tool.

“Let me give you an example: operating rooms,” Herrick said. “Because distances and movement are so critical, they design them using cardboard cutouts that can cost two- or three-hundred thousand dollars. … Imagine if someone could walk up (in a virtual operating room) and say, ‘You think that’s too wide?’” — he makes a pushing motion — “‘There.’”

VR’s broader commercial viability might track the technology’s path between virtual and augmented reality. VR, which shuts out the physical world, is better tailored for specific use cases, particularly as you ramp up the immersion. Axon VR, a California company with operations in Bellevue, is developing a full-body suit with haptic capabilities and a suspended rack that operate as a type of VR treadmill. Want to hike in the Alps? A headset displays the Matterhorn, the haptic suit chills your skin to alpine temperatures, and the suspended leg brace lets you walk for miles. Clients with more pressing needs are interested: Axon has been contacted by military branches and physical therapists interested in simulations.

“The dream was full immersion,” said Jake Rubin, who founded the company on Mercer Island before moving it to San Luis Obispo. “There’s a difference between strapping a screen to your face and a system like ours. You feel like you’re there.” AR, on the other hand, could be more commonplace. By superimposing digital imagery on the physical world, AR has a greater volume of practical purposes, and could provide what Berry called an “annotated reality” that layers relevant data (restaurant reviews, book stores, driving directions) on the real world.

“When you look at the convergence of big data, machine learning, machine vision, AR/VR display technologies, the cloud, and artificial intelligence — that’s going to be a system that knows what we want to see at any given time. That’s the 10- to 20-year time frame,” he said.

A NEW MEDIUM is distinguished by the senses it lassos. Radio gave consumers the ability to listen. Television combined movement, visuals, and audio. VR’s currency is presence, an ambiguous term denoting the feeling of being inside content as opposed to watching it.

Some technical thresholds make presence easier to accomplish. Latency must be minimized; your field of view must move with your head. It’s best if the field of view is around 120 degrees and the screen refreshes around 90 times per second; come in below those, and the mind can flag what it’s seeing as a digital fake. But once the technical requirements are met, presence becomes subjective. To some, a blue whale swimming by in a Vive is a profound experience, while to others it doesn’t compare with compelling documentary footage.

While reporting this story, I twice experienced VR presence. The first time was in January at Foundry10, an education nonprofit that has students and classroom partners working on VR projects.

During my visit to the organization’s office in Fremont, Ethan Busse, a senior at Highline Big Picture High School in Burien, slipped a Vive headset on me and turned on a virtual campfire. The animation was geometric, but otherwise quite good. The campfire’s light flickered off nearby rocks and trees, and sparks floated above the crackling fire. It was realistic enough to remind me of past nights staring at a campfire.

After about 30 seconds, Busse stopped the demo. “OK,” he said, “I’m putting in the wolf this time.”

Take 2: No tranquility. Snarls dripped from a canine that swirled just out of sight. I grabbed a torch laying by the fire, my head darting from side to side in an attempt to find the wolf. Not knowing when the wolf would emerge was stressful; not knowing from where it would emerge was worse. When the wolf snapped into view, its movements weren’t threatening; it didn’t so much lunge as quickly appear. Nevertheless, I audibly gasped, and had to refrain from cursing around the chuckling highschoolers. Later that day, I had a calmer date with presence. I sat on a swivel chair in RATLab’s office while Aharon Robinson navigated through Oculus Social, a hangout app available to Oculus Rift and Samsung Gear owners that allows groups of five people to watch Twitch or YouTube videos. Robinson was trying to find a room for me. “All of them are full right now,” he said. “This thing gets flooded in the afternoons, when everybody gets off work. I do it every night — it’s awesome.”

Finally, Robinson found a room occupied by a familiar face (username? avatar? What does one label a person in the virtual space?) and began chatting. “Hey, Otonka. I’ve got a journalist here, so I’m going to hand him the headset. Don’t mind my avatar shaking.” I slipped on the Gear, and was transported to a very realistic home theater. The room had five recliners, four of which were occupied by myself and three other floating-head avatars. Our seats were trained on a huge screen, primed for a Twitch feed. There was Bronx Antiguan, a yellow-hatted cowboy from New York; Anthony UK, a fox from England; and Otonka, a white cat from England. Robinson told me Otonka never changes his avatar to remain familiar and act as an usher for new Oculus Social users.

“This is, like, the fourth time I’ve used VR,” bronx antiguan said. “I love it. I just come home from work and hang out.”

“So do you just hop on and watch videos together?” I asked.

“The videos really are a small part of it,” Otonka responded. “It’s mostly about hanging out. We’ll meet on WhatsApp and plan to hang out in VR.”

Oculus Social makes it plainly obvious why Facebook would invest billions in social VR. The app is low-level stuff — the necessary infrastructure is a smartphone and a Wi-Fi connection, and nobody’s mistaking a floating cat head for a real person. But I was chatting with folks across the globe as though we were in the same room. Those silly floating heads tracked real people’s real faces, allowing us to make eye contact. I knew who was listening, and who wasn’t. There was no delay in the conversation, and we were going to watch videos together, just as friends do in living rooms every day.

This year, as headsets and applications hit the market, VR’s latest journey begins. Eventually, it will become a paradoxical medium. By shutting out the physical world around oneself, a user can enter a virtual world with friends from Dubai, coworkers from Alabama, or strangers from Mexico. It’s inclusion by isolation, enhancement by augmentation, a connection that supersedes disconnect.