Headset and content management and distribution company SpringboardVR works with over 500 out-of-home VR locations in 40 countries, so you can bet they have their fingers on the pulse of what’s going on in that part of the business. On April 9, the firm’s business chief Michael Festa wrote to the LBE VR community with information gleaned from a survey of their operators and thoughts on how the company and the industry will move forward. Click here to head to the original post, or read below.
An Open Letter to LBE VR
By Michael Festa, Chief Business Officer, SpringboardVR
The last four years have been an incredible privilege for me. I contributed to the birth of an industry, launched nine games into the market, built and ran a VR arcade and visited at least a hundred other arcades across the world. I know what the frontlines look like and it’s been humbling to see so many entrepreneurs put everything they have into making something this special.
That’s what makes this incredibly difficult time even more difficult for me personally. I have tremendous respect for what everyone in the LBE VR community has sacrificed to make it this far, and COVID-19 has jeopardized that in many ways.
I joined SpringboardVR this year as chief business officer to help drive LBE VR forward in a more impactful way, and regardless of the current situation, that is absolutely still my intention.
It is important to me SpringboardVR has an open and transparent communication channel where we can share trends and information on how we are helping the LBE VR community get through the COVID-19 pandemic. Over the coming weeks and months, I will be sharing some data around what COVID-19 has looked like through the lens of an LBE VR platform that manages hundreds of venues worldwide, and how (in my opinion) our industry can grow and move forward from this.
I want to start by going over the results of a survey we sent to our operators in mid-March to see how they were handling the news around COVID-19. I then want to discuss how SpringboardVR has responded, and is currently responding to that data.
Question 1: Is your business currently being affected by the COVID-19?
While this might seem obvious at first glance, it was important for us to quantify how difficult the situation was expected to be. At the time we sent the survey out, most of the world had not yet implemented shelter-at-home orders. At the time this is being written, some countries like Sweden, and some states in the U.S., still have not done this. There is a subset of people who feel the COVID-19 response is overblown, and it’s not serious enough to warrant the economic slowdown.
Regardless of anyone’s personal feelings, what should be immediately clear from this first chart is arcade owners have overwhelmingly felt the impact of COVID-19 since March. This is not a minor event, or a major event that is affecting a majority of LBE VR business. This is a major event that is dramatically affecting all LBE VR.
Question 2: Are you planning on closing your Arcade in April?
While this chart certainly does not seem positive at first glance, I personally see a lot of hope in it. Media critics have been saying “VR is dead” and “VR arcades don’t stand a chance” since the modern community began in 2016. Even with this global event negatively impacting arcades around the world, a whopping 84 percent of our partners are planning on being open for business when the coast is clear. Some arcades are still open for business today.
While only time will tell how many arcades will remain once the lockdowns end and the general public resumes normal activities, I see a lot of hope in our sector that even a crisis like this doesn’t cause the entrepreneurial spirit to fade.
Question 3: What can SpringboardVR do to help?
I wanted to leave this question open-ended so we could engage our operators about the range of their concerns. Their most frequent responses could be grouped as follows:
- Waive, defer, or reduce subscription fees during COVID-19
- Waive, defer, or reduce commercial licensing fees during COVID-19
- Use this time to improve SpringboardVR’s product
Answers #1 and #2 make complete sense. As a past owner and operator of a VR arcade, these are likely the first two things I would personally have asked of my primary supplier.
The third response is more interesting. Effectively, our customers are telling us this is a good time for SpringboardVR to get our house in order. To be completely candid, I’m quite glad to get that feedback.
What is SpringboardVR Doing to Help?
Let’s address this in order of the feedback received from arcades:
1) Waive, defer, or reduce subscription fees during this time
To me, it was obvious this is what our operators most needed from us. While it does put a financial burden on SpringboardVR, it was absolutely the right thing to do.
On March 16, we sent an email to all of our operators letting them know we would waive upcoming headset subscription fees for any company that was thinking about closing in April. We got over 100 messages in 12 hours. It became clear in the following days the COVID-19 impact was going to be extensive. As of now, we have waived April headset fees for 100 percent of our 500+ customers, and we’re monitoring the situation daily to assess future fee waivers.
2) Waive, defer, or reduce commercial licensing fees
SpringboardVR emailed our content creator community on March 18 letting them know we would cut our platform fees for any developer who wanted to help out by lowering their prices.
On the first day, developers of more than 20 games, including half of the “Top 10” games, agreed to cut their prices immediately.
Some developers, like Vertigo Games and Fallen Planet, went so far as to completely waive their license costs retroactively from March 1to help alleviate the pressures on arcades that had already accumulated costs.
As of now, more than 50 games on our platform, from leading developers like Owlchemy, Resolution Games and Survios, are free for commercial use.
3) Use this time to improve SpringboardVR’s product
I worked alongside SpringboardVR since 2017 during my time leading LBE at Survios. I was impressed with the company’s scrappiness, grit and ability to lead the growth of such a newly formed industry. But it was also clear to me SpringboardVR had, in some ways, lost sight of the LBE customer along their journey. SpringboardVR brought me on to address & fix that directly –– internally and externally.
My primary role and focus at the company is to make our LBE division a scalable, customer-centric venture that delivers clear value. There are plenty of areas for improvement with our product development, but also in delivering unparalleled customer support, establishing and communicating best practices, and nurturing a community of customers where we can all learn, share and communicate.
We have been making great strides since January around improving platform infrastructure and revamping our standard processes and procedures around support, marketing, operations, and everything in between.
Some examples of what we are addressing and delivering this quarter:
- Analytics overhaul for operators and content creators allowing for much richer visualization of utilization data & trends.
- Country-specific/ regional pricing to normalize operator purchasing power outside of the American market.
- Marketplace overhaul allowing for easier content onboarding while making more game information and filtering methods available for operators.
- Affiliate programs to bring operators discounts for common LBE hardware and peripherals.
- Publishing the 2020 LBE VR Whitepaper, which I believe will be the most comprehensive document of its kind on LBE VR operations. It combines our real-world consumption data from over three years to show what works –– and what doesn’t –– in a definitive study.
We are confident the LBE market will endure this pandemic, so we must push forward to build the best products possible. I agree wholeheartedly with our customers that this is the time for SpringboardVR to act in earnest.
How is SpringboardVR Holding Up?
Working as a remote team for the last three years, SpringboardVR was well positioned to adapt to the shelter-at-home mandates and the general changes in lifestyle due to quarantine. We have staff in three U.S. time zones and seven countries, and we’ve been utilizing video conferencing since 2017. We have been very fortunate in this regard.
The overall impact of COVID-19 is very real for us though. We are feeling the same financial strains our operators and content creators are feeling. We are human and are worried about the safety of our coworkers, our partners, and our loved ones. However, none of that changes the fact we have a lot of work to do as we prepare for business to resume. We are bunkered in, hunkered down, and actively working to make SpringboardVR better for our customers. We are excited to still be building and planning for the future.
Next, I want to dissect our consumption data to show how the year started off for LBE VR, and look at how the numbers and trends changed as the world became more and more aware of the seriousness of COVID-19.
That said, I’m curious about what insights the community-at-large wants. I encourage anyone reading this to send me an email at [email protected] to tell me what you would find interesting, or just to share your thoughts.
While times are certainly tough, I am incredibly optimistic about the future of LBE. The outpouring of support from operators, content creators, and other platforms further strengthens my resolve. The sense of community we are witnessing in the LBE ecosystem is truly remarkable. As an industry, we will come out of this stronger. Be well and stay safe.