The video game crash of 1983 remains a cautionary tale in the tech industry. Even for those who didn’t experience it firsthand, the story of market saturation and poor quality leading to a dramatic downturn is well-known. Some analysts believe the virtual reality market may be facing a similar inflection point, particularly as Meta shifts its strategy for the Quest platform.
The recent changes at Meta, including the closure of most of its VR studios in January, have prompted questions about the company’s long-term commitment to the space. This shift coincides with a growing influx of free-to-play games on the Quest store, a move that some developers and gamers believe is diluting the quality of the platform and mirroring the conditions that led to the 1983 crash. The situation has become particularly acute as Meta attempts to broaden its user base beyond dedicated VR enthusiasts.
According to a recent developer blog post, Meta is seeing growth in users new to the Quest ecosystem. Samantha Ryan, VP of Metaverse Content, highlighted that device sales increased in 2024, and users are spending more time on Quest 3 devices than any other headset at launch. Total payment volume across Quest devices also rose 12% in 2024, driven by increased in-app purchases. This suggests a shift in user behavior towards a more casual, mobile-style gaming experience, similar to what’s found on platforms like Google Play.
This trend towards free-to-play is exemplified by the success of games like Dimensional Double Shift, the multiplayer successor to Owlchemy Labs’ popular Job Simulator. While Job Simulator debuted on traditional gaming platforms like Steam and PlayStation VR, Dimensional Double Shift has found success on the Quest platform, crossing over 1 million installs within a year of its beta launch. Owlchemy Labs CEO Andrew Eiche believes this success is tied to a broader shift away from highly competitive games towards more cooperative and social experiences.
“If you look at the broader gaming landscape, there’s a push towards play as play,” Eiche explained in an interview. “We had a large push for many, many years towards competitive multiplayer games, and I think you’re starting to see a little bit of a backlash.” He notes that many players are seeking experiences where the focus is on fun and social interaction, rather than intense competition and the pressure to perform.
However, the rise of free-to-play games isn’t without its drawbacks. The influx of lower-quality titles, often referred to as “shovelware,” is making it harder for quality games to stand out in the Quest store. This issue is compounded by Meta’s decision to allow a wider range of content onto the platform, effectively turning the store into a more open marketplace. Developers have expressed concern that this change is burying quality titles and making it difficult for customers to discover them.
The situation is reminiscent of the Atari crash, where a flood of poorly made games saturated the market and eroded consumer trust. While the current VR market is vastly different from the early 1980s, the parallels are striking. Some developers are still finding success, but they are battling against a tide of clones and low-effort experiences.
Meta CTO Andrew Bosworth acknowledged the challenges in a recent Instagram AMA on . “We’re still investing more in content than anyone else. We’re even investing in more content than I think we were even a year ago,” he stated. However, the company’s spending habits remain opaque, and it’s unclear how effectively those investments are being allocated.
Despite the current challenges, many remain optimistic about the future of VR hardware. Eiche expressed excitement about upcoming releases like the Steam Frame and Project Aura, which are expected to significantly impact the XR landscape. Meta is also reportedly working on a new, lighter headset, codenamed “Project Phoenix,” that resembles a pair of glasses rather than a traditional VR headset. Bosworth teased the project during the Instagram AMA, stating that “the next two devices that we’re [building] are very exciting.”
The success of these new devices, however, may hinge on Meta’s ability to address the issues plaguing the Quest store. Eiche emphasized the importance of the store’s structure, stating that it “has an enormous impact on what the games look like.” The current mobile-style approach, he argues, drives prices down and consolidates power among a few large players, making it difficult for smaller teams to thrive. Whether the Steam model or the current Meta approach will ultimately prevail remains to be seen.
The future of VR gaming is uncertain, but the current situation highlights the delicate balance between accessibility, quality, and market sustainability. Meta’s decisions in the coming months will be crucial in determining whether the Quest platform can overcome its current challenges and avoid repeating the mistakes of the past.
