"We set out to prove that out and did a couple things. We worked with some game developers to show that when you do have that extra compute overhead or headroom available, that you can add more bells and whistles to titles, more effects, do more stuff that makes it more immersive. So we did some stuff over the past year with titles like Star Trek Bridge Crew, Arizona Sunshine, [and] Warhammer Vermintide, where we said, hey, this'll run on a minimum spec machine for the Oculus or the Vive, but if you have a higher performance machine, [it's] structured in such a way to recognize that that performance is there and throw more physics, more particles, more rag dolls, more smoke effects, things like that, at the compute engine."

"It's really only once in every ten years or so that something comes along that you touch and the first taste that you get of it, you're like, this really is magical"

While games are grabbing the spotlight in VR right now, Intel, like many other companies, is a believer in its power for numerous industries. Pallister notes that Intel has been showing its VR solutions off to the medical community for medical simulation and training, to engineers for CAD-type design usages, and more. VR is going to be just as much about enterprise as it is entertainment.

Cynically, one might say that Intel is pushing VR so that its own chip-set business can flourish as VR/AR becomes a more mainstream computing paradigm. And while Pallister acknowledges that increased PC sales is clearly a benefit for Intel, he disagrees that it's the primary motivator.

"Rather than just saying that we're interested because it moves machines or gets people to upgrade, we're interested because it's awesome. I was one of the early proponents for this wave of VR on Intel for the past couple of years and worked at a different company on VR stuff in the mid-90s as well. The way I phrase it is: it's really only once in every ten years or so that something comes along that you touch and the first taste that you get of it, you're like, this really is magical.

"And, for myself, it was the first time that you saw a 3D effects graphics card running Quake GL back in the '90s; it was an eye-opening moment. The first time that you touched your finger to an iPhone and did a pinch and zoom on a photograph; you're like, wow, mobile phones just changed forever, right? And I think almost everybody that has their first experience with the Vive basically says this is really something special.

"Then it becomes a question of, okay, it's also pretty kludgy, pretty high-end, pretty expensive. How do you make it accessible and easier and better and with a wider variety of usages and all this stuff? So there is an interest where we say, sure, just like with high-performance games, there will be a set of users that want the very best things. They'll buy high-end machines and this is yet another reason for them to buy the best thing available and buy a high-end CPU and maybe upgrade sooner.

"That's all great. But we're also doing a bunch of stuff to actually make it span across the spectrum. A lot of that focus on that work with Microsoft [and its mixed reality push] was about making it not require as high-end a graphic solution and making it run on a 15-watt notebook. Because we think it's important that, for some people, as magical as it is, they're gonna say, yeah, but I only buy one notebook and I need it to be really thin and light and fit in my bag and I wanna take it to school or work or whatever. So I don't have the luxury of a big high-end gaming desktop. We think it's important that there be a flavor of VR for those folks as well."

Intel sees the VR space continuing to evolve across a spectrum of devices, and the high-end PC may not always be at the heart of that experience. In fact, the PC itself could be taken out of the equation if you're talking about standalone headsets like the upcoming Oculus GO or mobile solutions like Google Daydream.

"Will there be people that say, yeah, I want the Nintendo Wii of VR? Less photo-realism but more convenience?"

Even in those VR formats, Intel may have some basis for participation. The company's RealSense camera technology is a key ingredient on the hardware side, providing its partners with inside-out tracking in VR. And while a day may come where a one-size-fits-all VR device has all the power you need at a reasonable cost, for a number of years ahead people will ultimately have to balance price with performance.

"Just as on the general purpose machine you can go from the phone all the way up to the high-performance PC, as people go up the power spectrum and the price spectrum and the capability spectrum for all-in-one devices, it'll become interesting because of the trade-offs in cost and in power," Pallister notes. "People will be forced to choose what it is they want to do. Oculus talked about its Santa Cruz device. We'll have to wait and see what ends up getting delivered in that, but, at least from the videos they're showing, that looks to be some kind of mid-range performance, but not the same high-end gaming on Unreal Engine 4 experience that you get with a high-performance desktop, right?

"Will there be people that say, yeah, I want the Nintendo Wii of VR? Less photo-realism but more convenience? I'm sure that a contingent of people will want that. Again, I think that overall it's good for the industry if there's a wide spectrum of choices between appliance and general purpose machines, and high-performance and low-performance. It just gives people more choice and it brings more critical mass to support all the developers out there."

Even if a consumer isn't going to buy a standalone VR device, Pallister agrees that being untethered is absolutely critical to the VR experience going forward. And that's yet another area that Intel is pushing into with its WiGig technology - a wireless 60 GHz band to deliver high-speed communication, effectively replacing cables for monitors, USB devices and, of course, VR HMDs.

"We think that things like making the PC experience a wirelessly connected experience - so it's still using a high-performance machine connected to a wall socket and being able to deliver all that performance, but without the downside of the tether - is a goal that the whole industry wants to get to," Pallister says. "HTC announced some months back that it's collaborating with us on an accessory for the Vive based on WiGig technology... It's a pretty no compromises experience. If you did a side-by-side with or without the cable, you'd have a hard time telling us which was which other than [feeling] a little bit of weight [from] the module, having it on your head.

"So there's a number of things on the hardware side that we're bringing to bear as technology ingredients keep VR getting better year after year."

VR is truly getting better each year, but so far the masses have barely noticed as sales have very much been a slow burn. This isn't a big concern for Intel, says Pallister, despite some of the bleak assessments from analysts.  

"Everyone got really spoiled by the rocket ship uptake of things related to mobile, right?" he says, citing the analyst community. "And everybody's kind of like, '[We need to see] hundreds of millions of units in two years or it doesn't count.' We all got a bit spoiled that way.

"I think you need to get to a bootstrap of the quality of titles along with the install base of paying users being of enough critical mass that it can actually sustain the development of these titles and be profitable"

"And if you step back to the dawn of this age of VR, I think there were quite a number of voices that have a more sanguine look at, hey, this is gonna take a while, right? And there are a few things that you really need to get mainstream adoption beyond hardcore gamers and things like that. The good news is that you're seeing a number of...nice strikes against each one of these issues happening in the tail end of this year and the beginning of next year, which I think are going to make 2018 a real improvement over the previous year."

One of those issues is price, and MSRPs for the high-end HMDs have already dropped quite a bit (with Oculus just recently making its Rift and Touch bundle $399) and will only continue to go lower. The other key issue is making sure VR owners have fantastic content. That remains a work in progress but Pallister is encouraged by what he's been seeing.

"This has been a concern of mine," he admits. "Not the number of titles. There are a lot of people doing interesting things on Steam VR and things like that. But I think you need to get to a bootstrap of the quality of titles along with the install base of paying users being of enough critical mass that it can actually sustain the development of these titles and be profitable. Or some portion of them can be profitable, so it looks more like the regular hit curve that you get on other platforms. Until that happens you're still going to see some of the titles be partially sponsored or people paying for exclusives or the other ways that developers make ends meet.

"That said, you do have some big name titles coming. There was a concern early on that, okay, Space Pirate Trainer and Job Simulator and other games... they're tremendous fun, but some number of people that paid $600 for a headset at the time were...expecting to, like, go into Grand Theft Auto or something. If I'm a hardcore gamer, I want those big name experiences./p>

"And [now] Bethesda has announced three titles, Valve is working on a title, you've got some big names like Ubisoft and others coming in. So it's not yet $100 million title development, but it's certainly triple-A studios now coming in and saying, okay, let's either add a VR mode or a smaller experience based on the same IP with the same level of polish. That's going to help the content in one respect."

As manufacturers make their HMDs untethered and add inside-out tracking, thereby eliminating cumbersome trackers and lighthouses or wires around your system, VR could hit an inflection point. And with VR evenutally gaining more attention from the masses, Pallister is convinced it will sync up beautifully with another of the game industry's burgeoning segments: esports. Intel has already partnered with ESL on the first ever VR esports league, the VR Challenger League, which kicked off at the recent Oculus Connect 4 event, featuring games like The Unspoken and Echo Arena.

"We're looking at VR as a new exciting vector of gaming and we think it's a pretty natural fit that, as it gets to critical mass, there will be a facet of overlap between esports and VR that we think will be quite exciting," Pallister comments.

"It's not just that these are both areas of hot excitement, so surely if we put the chocolate in the peanut butter it'll be better. For one thing, if you spend any time in any multi-user VR environment, it's an extremely visceral experience. The magic of it gets [multiplied by ten] the moment that you see another human in there... Obviously, esports contributes to that. So there is, for the player, the feeling of stepping into an arena, seeing people around you, realizing that they're live, and there's the adrenaline pump that happens."

The other aspect of merging VR with esports is that it could actually make it a more accessible and enjoyable experience for the average viewer.

"We think there's a potential to make esports interesting for people to watch that don't actually play the game titles"

He offers: "From the other perspective - and probably we'll wait and see it emerge over time - we think there's a potential to make esports interesting for people to watch that don't actually play the game titles. If you've ever watched a League of Legends tournament - or [another] popular, competitive game that I don't play at all - when I watch it I don't know what's going on. I can't tell at all. But if I watch a bit of footage of two guys facing off with swords in a virtual environment, I don't need to know all the rules necessarily to understand what's going on.

"Does that mean it's the next NFL? Probably not anytime soon. But could it get to things like American Gladiators, if you remember that, in terms of something that was a little bit cartoony but also a little bit futuristic and that people got off on watching people compete in this environment? There's excitement from our perspective in that we think it's exciting for the players [and] it has the potential to be exciting for people to watch."

People without VR HMDs don't have to be left out either, Pallister says: "There's a lot of experimentation beyond even just esports, but certainly applicable to esports, around the best way to convey the experience people are having in VR to those that aren't in VR. One thing most people agree with is just streaming a video of the view that the player gets at their HMD and then expecting you to follow along with that is not only confusing, it's nauseating.

"There's a lot of people playing around with in-game camera systems that you could just stream traditional views from. That was done at the Oculus Connect last week. We did an Echo Arena game tournament there and had it up on the stage and a team of players on one side, a team of players on the other side, and then giant screens that were just like traditional 3D rendering from the sidelines, if you will, of these 3D environments. So that's one way to do it."

Whether it's developers, headset makers or esports leagues, Intel wants to makes its VR presence felt. That could be helping out on the next iteration of hardware, spreading awareness with developers or, importantly, pushing for increased adoption with the masses and businesses.

"We do a lot of work around the promotion of VR to consumers," Pallister stresses, "[and] to commercial enterprises as well. There's a lot of collaborating we've done to say, 'OK, how can we take all of the work that Intel does marketing ways to use their computers, to consumers and businesses, and how do we use VR as part of that and also use that as part of how we amplify the VR message for those vendors?' We would like if they view us as an amplifier for their message to the world."