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Pico 4: A Threat to Meta

Is the Pico 4 the next big disruptor in the VR market?

Source: ByteDance's Pico 4 VR Headset

Standalone VR headset Pico 4, developed by ByteDance, could be a major competitor to Meta’s Quest. As the fastest growing VR headset on steam last month, it's quickly eclipsed the Meta Quest in terms of the gaming sector–the sector expected to catalyse the push into the metaverse.

Meta's Quest Failed?

In comparison to its new competitor, the Meta Quest 2 is hardly used on Steam–the largest digital distribution platform for PC gaming. This could be the final nail in the coffin for Meta, coming at not just a time of a global economic hardship, but also catastrophic losses: The company has lost over $700 billion in valuation since pivoting to a full-focus on metaverse tech.

Previously, it seemed like good news, as MR competitors MagicLeap and Microsoft had announced they would enter a "co-opetition", focusing less on consumers and more on B2B applications of VR and AR. This would've given Meta a monopoly on mixed reality, especially as we're still waiting for Apple's announcement on their upcoming MR headset, expected to debut late next year.

Now, the Pico 4 seems to be rapidly overtaking the Meta Quest 2 in terms of consumer adoption, as gamers are preferring the standalone Pico VR headset over Meta's own.

Currently, only around 2% of Steam users use VR headsets, as we're still in early days in terms of adoption. With Steam still breaking records reaching its peak 31.3 million MAU, this puts VR use at approximately 626,000 VR users monthly.

Not Yet Pico's Peak?

Despite Meta's Quest taking up over 40% of the market share, the Pico 4 is rapidly rising in usage amongst gamers, making it a viable threat to the company's place on the podium.

Last month, amongst SteamVR users, the Pico 4 was the fastest growing in terms of usage, from 0.19% to 0.67%. While this could simply be reflective of the fact that it only released in mid October–causing an initial pump in usage–it quickly eclipsed other competitors in terms of market share and usage.

It's expected to overtake HTC Vive's models over the coming months, with current statistics lending credible credence to Pico becoming a major competitor in the VR market. However, it's important to consider that these are only reflective of the usage on SteamVR, which itself comprises a smaller part of the overall VR market.

How the market progresses from here is as question for analysts, especially as we enter a looming recession, but if Meta's recent reports are any indication, it won't be a shock to see them toppled from their top spot.