Chinese VR and smartphone makers quitting en masse

Industry sources told DigiTimes that a lot of Chinese manufacturers have left the virtual reality (VR) and smartphone markets. Nearly half of all Chinese brand vendors of entry-level to mid-range VR devices are no longer able to compete as the pricing of the more popular devices like the Oculus Rift and HTC Vive dropped significantly this year.

The sources disclosed that many China firms were rushing to join the retail market for simple VR headsets and boxes after Google Cardboard was launched in 2014. As of January 2016, there were as many as 350 China-based brand vendors engaged in retail sales of such products, particularly VR boxes.

Although China now still commands nearly 50% of the global market supply of VR boxes, the sources continued, the number of China's brand vendors of budget-priced VR boxes and headsets has sharply shrunk to 190 now for failing to survive the changing market scenarios, in that all-in-one VR devices boast a growing variety of functions and ever-improving performance while the prices of high-end VR products have also been on the decline.

The site points out the same thing is happening in the Chinese smartphone market. Since September 2016, the number of Chinese smartphone brands has reportedly dropped from over 200 to a level of around 120. This is because the smaller players have a hard time competing in terms of price/performance and lack the brand image of first-tier players like Huawei, Oppo, Vivo and Xiaomi.