The Guardian remains committed to VR, despite limited commercial opportunities

The Guardian is remaining committed to virtual reality even though it’s unclear when it will become a moneymaker.

At the beginning of October, the publisher — which has experimented with VR for over a year — started bringing its nine different VR experiences into its Guardian VR app and sent out 100,000 Google Cardboard headsets to make its VR content more accessible.

“There’s a real enthusiasm and genuine excitement around the whole organization, including senior-level staff, about how VR can be part of our journalism here,” said Fran Panetta, executive editor of VR at the Guardian.

But for the commercial side, VR remains mostly a journalistic experiment rather than a big source of revenue. Distribution is VR’s biggest hurdle: For many publishers, the low number of people buying headsets doesn’t justify the cost of production, and low reach doesn’t encourage branded-content partnerships.

“Compared to the U.S., the scale in the U.K. market for VR is still catching up,” said Adam Foley, the Guardian’s commercial strategy director. “VR is still a young technology, but as it develops, we are confident the demand will grow.” He added that the focus so far has been pushing the boundaries of VR, and it’s exploring how to monetize through bespoke branded content packages.

All the Guardian’s VR pieces follow a first-person narrative on topics the publisher covers in other formats. For example, in “Limbo,” the viewer experiences what it’s like to seek asylum in Europe, while “Arctic 360” shows how humans cause ice caps to melt. To date, all of the Guardian’s VR films are under 10 minutes.

Right now, Google is funding VR for the Guardian, like it does for The New York Times. The problem is those subsidies nearly always run out, leaving publishers with VR teams to support through advertising and small audiences to boot for something that’s not yet mainstream.

“The Guardian is showing the brand community and viewers that it’s looking at journalism in new ways, finding new hooks,” said Mark Holden, global strategy director at Starcom. “It may be in a financially challenging place but still wants to engage viewers with the brand.”

Brands are being more selective about their VR investments than a year ago, Holden said, ensuring that the idea justifies the format. Worldwide spending on VR and augmented reality is expected to sore to nearly $215 billion (£163 billion) by 2021, according to the International Data Corporation. With limited distribution from publishers, brands can produce VR on their own rather than rely on people to download a publisher app, which can be costly and difficult.

The Guardian is under pressure to find a viable commercial model. In July, its parent company reported narrowed losses of £45 million ($59.3 million) in the previous financial year. The Guardian’s turnaround plan calls for a 20 percent cost reduction over three years. This week, The Guardian Media Group announced plans for a £42 million ($55.4 million) venture fund for new business lines.

The Guardian’s most recent VR piece, “The Party,” where the viewer experiences a birthday party through the perspective of a 15-year-old girl with autism, took the publisher’s VR team of five — from areas including editorial, digital, design and commercial — six months to develop, shorter than the nine months its first VR project required. The Guardian interviewed 10 women who either have autism or have experienced it through others, as well as researchers from the University of Cambridge and the National Autistic Society for “The Party,” Panetta said.

One consideration is whether to use scripted or real dialogue, Panetta said. The Guardian likes to incorporate real interviews, but putting people in someone else’s shoes often requires scripted dialogue. Working out how to impart information has also been a challenge — people don’t want to absorb facts in VR experiences. One way the publisher did this in “First Impressions,” an experience about the first year of life, was changing the film color gradually to show that humans start seeing the colors red and green before blues and yellows.

Panetta said it’s important that the Guardian controls the environment in which people experience its VR content. For instance, it refrained from uploading the full version of “6×9,” a piece where the viewer experiences solitary confinement, on YouTube because the immersive feel doesn’t translate well without a headset. Instead, an abridged version exists. “6×9” has had half a million views on YouTube; in comparison, the Guardian’s other VR films have each had up to 50,000 views. The publisher was unwilling to share numbers on how many people use its app. According to App Annie, this week the app is No. 13 in news apps for the U.K. on iOS.

Image: courtesy of the Guardian.

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