A union of art and VR technology has taken interactive media content to new highs. The latest being the concept of “Virtual Beings,” is touted to be the next big thing.
Recently, Wolves in the Walls, developed by Fable Studio Inc. and Facebook FB, featuring virtual being, Lucy, for the first-time ever, secured an Emmy, for “Outstanding Innovation in Interactive Media,” and remains quintessential in this regard.
Virtual Beings are here to revolutionize the concept of VR tech with creative media. In depth research on AI and VR tech combined with artists and storytellers’ imagination is facilitating the growing clout of Virtual Beings.
Markedly, Wolves in the Walls, a VR-based interactive adaptation of a children’s book by Neil Gaiman, utilized handheld motion controllers and VR glasses to make 8-year-old Lucy’s journey engaging for viewers.
Per Edward Saatchi, co-founder of Fable Studio, Virtual Beings are virtual characters with whom the audience can develop a two-way interactive emotional relationship.
In fact, Virtual Beings are carving out a niche market for themselves. Saatchi believes that Virtual Beings can win Oscars for live action sequences, even a Grammy, or take the role of a spiritual guide, or be the next operating system (OS) which remembers the interactions with individuals.
AI & VR Merger Leads to More Believable Virtual Beings
We believe AI will play a crucial role in moulding these virtual beings into being more realistic, in a bid to incorporate cognitive thinking process into machines.
The advancements in conversational AI, for instance, have brought us closer to the virtual versions of intelligent machines in the form of voice assistants. Apple’s AAPL Siri, Ok Google, Microsoft’s MSFT Cortana and Amazon’s AMZN Echo among others, have come mainstream.
With technology and life intermingling at every aspect of this world, it is time to look at lifelike and realistic forms of these machines, which would have a wider range of applications. Notably, Instagram’s virtual influencer, Lil Miquela, has 1.6 million followers and has featured in ad commercial with Bella Hadid. This highlights the narrowing gap between the real and virtual world.
Breakthrough research in ML, natural language processing (NLP) and computer rendering are providing more interactive capabilities to virtual avatars.
Bullish Projections
In a recent report, IDC projected that worldwide spending on cognitive and AI systems will be around $35.8 billion in 2019, up 44% over 2018. The tally is set to hit $79.2 billion in 2022 at a CAGR of 38% between 2018 and 2022. Moreover, per Gartner, AI augmentation is envisioned to generate business value of $2.9 trillion in 2021.
Further, a Zion Market Research report shows that the global market for AR/VR is anticipated to reach $814.7 billion by 2025 at a CAGR of 63.01% between 2019 and 2025.
Let’s take a look at some stocks, which are well poised to capitalize on this prospect and are likely to play a noteworthy role in virtual beings market.
Year-to-Date Price Performance
Stocks in Focus with Recent VR Developments
Facebook has left no stone unturned to enhance content across platforms — core Facebook app, Instagram, Messenger, WhatsApp, with an aim to make it more engaging. The company has also a dedicated Oculus team working on VR tech. The social media giant’s concerted focus on making platforms as interactive as possible remains a tailwind.
Markedly, Facebook unveiled latest VR headset — Oculus Rift S, in March, this year. Moreover, Oculus has supported quite a few award-winning VR projects including Wolves in the Walls, which speaks for itself.
Further, the company’s strength in Facebook 360 portal with interactive videos, images, live content and VR conversation bodes well.
Microsoft is infusing AI capabilities across its portfolio of services, which includes Azure, Windows, Cortana, Gaming, Office 365, Dynamics 365, HoloLens, among others.
We believe Microsoft is likely to gain from Virtual Beings market on an optimal blend of strengthening mixed reality (MR) HoloLens capabilities, AI expertise, expanding gaming studios, and enhancements to Azure.
Moreover, Microsoft Research has dedicated portals of Interactive Visual Media and Interactive Media Group.
Netflix NFLX can’t be ignored when it comes to interactive media content. The company’s Black Mirror: Bandersnatch gained widespread popularity as users were given the choice to select their own ending.
The move apart from boosting user engagement helped the company get detailed insights into consumer behavior patterns, which can be utilized to tune its content portfolio.
Further, viewers can watch VR content on Netflix VR app with Oculus Rift, Google Daydream, among others.
Apple’s budding efforts on AR/VR technology have been in the news for quite some time. The company’s acquisitions of Vrvana, Akonia Holographics, SensoMotoric, among others, remain noteworthy in this regard.
The company has reportedly been working on Apple Glasses, a MR headset device with an aim to offer “3D virtual views of a user’s environment augmented with virtual content.”
Zacks Rank
Microsoft carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Meanwhile, Facebook, Netflix and Apple carry a Zacks Rank #3 (Hold).
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