Best Buy Pushes Virtual Reality Ahead of Holidays

Are virtual reality (VR) headsets the next big thing for consumer electronics or are they the next big thing for tech company marketers? The devices get a lot of ink and pixels, but they are not exactly taking the market by storm.

With the holiday shopping season in view, we can expect the hype level to increase, both from the makers and from retailers. Best Buy Co. Inc. (NYSE: BBY), for example, is promoting a variety of VR devices, from those that require a smartphone and cost as little as $10 to standalone systems with price tags of up to $800.

Estimates from market research firm Strategy Analytics cited at Fortune expect sales of VR devices to total around $556 million in the holiday shopping period, with about 11.4 million American adults coughing up the cash for one of the devices. The average spend is less than $50, indicating that the lower priced models that require a smartphone are expected to dominate sales.

Market penetration by the end of this year is forecast at 6%. That may sound low, but Strategy Analytics points out that the iPhone held about the same penetration rate two years after its introduction.

The least expensive VR device is Insignia’s Virtual Reality Viewer (model #NS-MVRCG1), a cardboard device, available at Best Buy for $9.99. According to the website, free shipping is available on this device.

At a price closer to the average is the Hyper HYPERVR Z4 headset (model #HYPERVRZ4) for $49.99 with free two-day shipping. The device accommodates any smartphone from a 4-inch to 6-inch model and includes integrated headphones.

At the high end of VR devices that require a smartphone is the Samsung Gear VR headset for selected Samsung phones (model #SM-R323NBKAXAR) for $99.99 with free two-day shipping. The device uses technology from Oculus, the VR company acquired by Facebook in 2014 for $2 billion.

Best Buy also features the Sony PlayStation VR (UPC code 711719504511) for $399.99. The system includes a processor unit, cables and stereo headphones, as well as free two-day shipping.

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