In a stark acknowledgment of the virtual reality gaming sector’s ongoing struggle to captivate mainstream audiences, Sony Group Corp. has temporarily halted production of its flagship PSVR2 headset as inventories of unsold units swell, according to individuals familiar with the company’s strategic pivot.
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Sony Suspends PSVR2 Production Amid Sluggish Sales and Swelling Inventory Glut
Sales of the $550 PlayStation 5 wearable accessory have languished progressively since its launch in February 2023, prompting accumulating stockpiles throughout Sony’s supply chain that have eclipsed over 2 million assembled units, said the people, who requested anonymity as the details are not public.
Data from research firm IDC corroborates this softening demand trajectory, with PSVR2 shipments to retailers declining quarter-over-quarter since its debut, though analyst Francisco Jeronimo remains optimistic about the VR market’s long-term prospects, forecasting an average 31.5% annual growth through 2028 buoyed by Apple’s hotly-anticipated entry.
Yet alongside fellow virtual reality pioneer Meta Platforms Inc., Sony’s persisting challenges underscore the ambient tensions plaguing this nascent technological realm: A dearth of compelling software experiences and a relatedly muted embrace from entertainment titans have dampened consumer enthusiasm.
Apple itself grappled with analogous quandaries upon unveiling its ultra-premium Vision Pro headset, which launched devoid of virtual reality content from streaming behemoths like Netflix and YouTube.
Sony’s retrenchment extends beyond the production line pause, with the company confirming last month’s closure of its PlayStation London studio dedicated to virtual reality game development. This strategic pivot coincided with layoffs impacting teams like Guerrilla Games, which had embarked on creating the PSVR2-exclusive Horizon Call of the Mountain installment within its popular post-apocalyptic franchise.
“The high price of VR hardware acts as the main hurdle for its expansion,” assessed Macquarie analyst Yijia Zhai, citing the elevated development costs and consequent scarcity of compelling software as a compounding deterrentLoop.
While Sony remains committed to expanding the PSVR2’s content portfolio, evidenced by February’s announcement that it’s testing compatibility with PC titles, the production pause casts a pall over virtual reality’s mainstream adoption arc – at least for the immediate future.
