[Exclusive] '5G Killer Content?'... Telecom Companies Withdrawing from the Virtual Reality Market

KT Ends 'Super VR' Service... LGU+ to Stop Selling 'U+ Real Glass' in August
No Content, Devices Expensive and Inconvenient

KT Super VR Service Termination Notice. Photo by KT Homepage

[Asia Economy Reporter Oh Su-yeon] The three major telecom companies are withdrawing from or reducing investments in the virtual reality (VR) and augmented reality (AR) businesses, which they had heavily invested in as "future content." At the time of the 5G introduction, these were expected to become killer content driving service expansion, linked with concepts like the "metaverse." However, they failed to resolve issues such as expensive device prices, inconvenience, and chronic motion sickness caused by prolonged content viewing, and also could not find a suitable revenue model.

KT Ends ‘Super VR’ Service

According to the telecommunications industry on the 19th, KT will terminate its ‘Super VR’ service on the 31st. Existing paid subscribers plan to switch to alternative services such as Millie’s Library and Blaise Select. There have been several signs that KT’s Super VR service was not going smoothly. It initially gained brief popularity but later became a mere gift when signing internet or IPTV contracts. This year, KT began to actively reduce the service. In May, the Super VR mobile application (app) service was terminated, and in August, all VR service core content, including games, was discontinued. The rental service was also stopped.

KT Super VR. Photo by KT

LGU+ Struggles with VR, SKT Only Acts as Simple Distributor

It is not just KT. Earlier in June, LG Uplus stopped selling the AR device ‘U+ Real Glass.’ This was about two years after launching the device in partnership with Enreal. Since then, they shifted to expanding content through the XR platform ‘U+ Dive’ app, but the service expansion has not been smooth, as it does not support linkage with Meta Quest, the market-leading VR device.

SK Telecom, instead of directly investing in VR, acts as the Korean distributor for the VR device ‘Quest’ made by Meta. At launch, it received a good response mainly from enthusiasts but did not gain widespread popularity. Additionally, SKT is creating content through ‘Jump VR’ and ‘Jump Studio,’ but there is still a long way to go.

At the time of 5G commercialization, the telecom industry anticipated VR and AR would become killer content similar to LTE’s video streaming services and rushed to invest. However, now, more than three years into 5G, no differentiated content has emerged. The core equipment for enjoying content, VR and AR devices, are expensive and cause discomfort such as dizziness or a sense of alienation, making improvements in wearability urgent and slowing distribution speed.

Downward Trend Overseas as Well

The situation overseas is similar. Recently, Guo Mingchi, an Apple expert and analyst at Taiwan’s TF Securities, predicted that the launch of Apple’s MR headset has been delayed from the second quarter to the second half of next year due to software issues. He forecasted shipments to be below 500,000 units, lower than the market estimate of 800,000 to 1.2 million units.

Market research firm CCS Insight had expected 14.3 million VR and AR devices to be shipped by the end of this year, a 30% increase from the previous year, but recently lowered the sales forecast to 9.6 million units. The forecast for next year is also expected to be only around 11.4 million units.