The $599 consumer Oculus Rift package.

JAN. 7, 2016 • Oculus VR, LLC this week announced that it would begin taking preorders for its Oculus Rift virtual reality headset at $599. The first deliveries are expected to ship in March, with later preorders getting fulfilled on a first come first serve basis as supplies permit. The $599 price includes the Rift headset with built-in headphones along with a microphone, Microsoft’s Xbox One controller, plus an Oculus Remote. Those who preorder the package will also receive a copy of developer CCP’s EVE: Valkyrie. Also included is Lucky’s Tale, a 3D action platformer from Playful Corp. In February, Oculus will add a SKU that includes the above-mentioned Rift package plus a PC certified to run the VR headset well for $1,500.

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Impact: There has never been a doubt that the Oculus Rift would sell. The question was how many would be sold at an elevated price. Frankly, we expected $399 would be too high an MSRP for most mainstream consumers to stomach. At $599… we remember how well that price point served the PlayStation 3 at launch. Oculus’ mission now is to convince the masses that the Rift is not an accessory but a gaming system. In some ways, the $599 price puts the Rift in the same value proposition as a high-end PC monitor. From DFC’s perspective, there are way too few standout VR game titles to justify the purchase of a Rift at this MSRP. It is not about technology or quality of manufacture – both of which are commendably high. At $599, sticker shock sets in and we see the non-hardcore game consumer sitting out the Rift to wait and see how well the system is supported. The jury is still out in the development community as to what constitutes optimum gameplay mechanics that engage users without making them nauseous. As Oculus parent Facebook is not short of investment capital, these are not make or break issues for the VR innovator. However, neither do we believe the heightened buzz surrounding VR will translate into mainstream consumer sales to make the hardware more than a niche player. Right now the appeal is more to the new gadget lover who wants the latest and greatest. The danger is the novelty wears off before the Rift hits a mass market price.