ESPOO, FINLAND—Nokia points to slower-than-expected VR development as a major factor in its decision this week to halt development of its 360-degree OZO VR camera.
The camera, which drew industry accolades and large crowds at industry gatherings like the NAB Show and the IBC convention, found initial success for special projects, such as pieces to promote Disney’s most recent adaptation of “The Jungle Book” last year.
However, despite initial excitement, the 360 VR market did not grow as expected, particularly with regards to content development, says Michael Inouye, principal analyst with ABI Research.
ABI Research was one of many market research companies forecasting a surge in professional and prosumer 360-degree camera sales.
In August 2016, it forecast sales of professional grade and mid-tier prosumer 360-degree cameras to reach nearly 2 million and consumer 360-degree cameras to reach 4 million units by 2021.
“I think a big part of it [the decision to halt OZO development] was the market wasn’t developing as rapidly as they had hoped,” he says.
Much of the content being produced was promotional rather than a feature-length film or even shorts, he says.
“Even the live 360 video part of the market has been more experimental than formal services,” he adds.
Another likely factor in Nokia pulling the plug was that its camera was positioned for the high-end of the market. When introduced in November 2015, Nokia priced the camera at $60,000. Today, it is priced at $25,000 on the company’s website.
“We’ve seen a lot of cameras coming in at lower price points targeting both the professional and prosumer markets with very similar feature sets and [delivering] a similar quality of experience from the end consumer as the Nokia unit,” says Inouye.
Staff reductions stemming from the decision are expected, according to the company. Up to 310 of its 1090 employees, mostly in Finland, the United States and the United Kingdom, could be affected.
While Nokia is discontinuing further development of the camera, it pledged to maintain “commitments to existing customers,” according to a company announcement.