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Imax is Shutting Down Its VR Business, Closing Remaining Three VR Centers in Q1 (variety.com)
Imax is making its exit from virtual reality (VR) official: The company notified shareholders with a SEC filing this week that it will close down its remaining three VR centers, and write off "certain VR content investments." From a report: A company spokesperson confirmed the planned closures and shared the following statement with Variety: "With the launch of the IMAX VR centre pilot program our intention was to test a variety of different concepts and locations to determine which approaches work well. After a trial period with VR centres in multiplexes, we have decided to conclude the IMAX VR centre pilot program and close the remaining three locations in Q1 2019."
The company previously closed four of its seven VR centers, including most recently its sole European outpost in Manchester. Imax launched Imax VR in early 2017 with a flagship location adjacent to the Grove mall in Los Angeles. At the time, the expansion into VR was billed as an experiment, and a way for Imax to determine whether VR could be the next big thing for the company. [...] Imax also set up a $50 million VR content fund, and got CAA, China Media Capital, and the Raine Group to co-produce VR experiences. Further reading: The virtual reality dream is dying.
The company previously closed four of its seven VR centers, including most recently its sole European outpost in Manchester. Imax launched Imax VR in early 2017 with a flagship location adjacent to the Grove mall in Los Angeles. At the time, the expansion into VR was billed as an experiment, and a way for Imax to determine whether VR could be the next big thing for the company. [...] Imax also set up a $50 million VR content fund, and got CAA, China Media Capital, and the Raine Group to co-produce VR experiences. Further reading: The virtual reality dream is dying.
What this was was yet another stab at the consistently failing Family Entertainment Center. Chuck E Cheese, Showbiz Pizza, Discovery Zone, GameWorks, etc, etc.
This isn't any argument about the merits of VR.
It's notoriously difficult to run an FEC as it requires a substantial investment and does not lend itself well to franchising. People just generally don't care to spend hundreds of dollars to get their family into a place for a few hours that isn't substantial. While Disneyland seems expensive, it's 16 hours of entertainment which works out to $10-20 per hour per person which isn't unreasonable compared to other family entertainment options.
Disney tried the small model FEC and failed as well. You just can't really do it on a small scale. You have to go big out of the gate.
The companies that would be more likely to succeed are the ones that have substantial IP to capitalize on and can keep the place afloat long enough to realize the full profit potential. You just can't half-butt it and that requires substantial cash flow.
The VOID seems to be doing pretty well over at Downtown Disney. It's a Star Wars themed social experience in VR in a prime location. It wouldn't surprise me if Disney eventually found a way to incorporate it directly into an experience in the Star Wars area of the park opening next summer.
In short, there are too many variables to say anything about VR in particular. The tech is vastly improving, opportunities do exist, but you have to get all the factors in place.
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