Apple and Next VR: The Reality Distortion Field is Back

‘The reality distortion field was a confounding melange of a charismatic rhetorical style, an indomitable will, and an eagerness to bend any fact to fit the purpose at hand. Amazingly, the reality distortion field seemed to be effective even if you were acutely aware of it, although the effects would fade after Steve departed.’

The above quote is from Apple employee Andy Hertzfeld in 1981, describing a young Steve Job’s ability to bend perceptions of what was possible at the company. This persuasive skill, termed 'the reality distortion field', would later become infamous across the technology industry. The technique was said to apply to Apple’s engineering teams, Wall Street and anyone who stepped into the temple to the brand in the form of an Apple store. 

Almost forty years later and Apple is back in the reality distorting business. Given the company has been criticised for the lacking the innovation it did under the visionary founder, its acquisition of Next VR comes at an interesting time. VR investments had dropped significantly since its wave of enthusiasm between 2014 and 2017 and the technology was very much believed to be in the trough of disillusionment. Now that the world’s largest tech hardware company has made a very public acquisition, what does this mean for Apple, VR and particularly the future of sports broadcasting? A few thoughts:

• Renewed interest in VR and home entertainment in light of Covid-19: Speaking last year, Apple’s SVP of Internet and Software Services Eddy Cue had this to say regarding tech companies and the future of sports broadcasting: ‘You really can’t own all the rights, so therefore at some point, you need to solve some other problems. You can’t design for owning the rights because if that’s the only thing you’re doing you’re always going to be tiny.' While Facebook and Amazon have been acquiring rights, Apple sees an opportunity in providing solutions for broadcasting rather than being a direct competitor. Next VR is not a major sports rights player, and in a world where VR may be about to have its moment if more people are at home and amenable to the idea of Virtual Reality. Considering the impact of Covid-19 on their bottom line, Sports teams are open to suggestions for new revenue streams to compensate for their losses. The tempestuous relationship between traditional broadcasters and Netflix means Apple may find itself in a position that allows the company access to sporting content and opportunities others may not.
• SVOD services have so far struggled to make the dent required in the sporting universe: Documentaries aside (notably the recent success of The Last Dance), sports rights, owing to the relationship between the teams and broadcasters, have stoically stood firm against SVOD disruption. SVOD services such as Netflix and Amazon Prime fund quality scripted-drama series, full-length films and stand-up comedy specials by the world’s most recognisable names, yet sports broadcasting continues to elude them. Indeed, it was an influential factor in the Comcast acquisition of Sky. Apple's acquisition of NextVR may be a roundabout strategy approach to becoming an influential player in the future of sports.
• Sports have historically acted as a major catalyst for the development of new media platforms: Apple has acquired the company presently most opportunely placed to take Sports into VR, and from a strategic perspective in media, that can prove invaluable. The rise of the NFL and NBA in the 80s followed the debut of ESPN in 1979, while the Premier League’s dramatic ascent to global recognition was on the back of its Pay-TV deal with Sky in the early 90s. While sceptics of VR’s mainstream potential have pointed towards clunky hardware, recent history suggests it is unwise to bet against Apple. From the smartphone to AirPods, they have shown remarkable deployment of the second mover advantage strategy and allowing early adopter technology to cross the chasm into the mainstream.

If Apple and Next VR can succeed where SVOD has struggled and capture just a small part of this value by servicing early-adopters at the birth of the Virtual Reality sports experience ( a market that seems far more lucrative than perhaps even a few months ago) this could prove an opportune investment and a catalyst for VR broadcasting into not only sports but other entertainment vertices such as live music.