Earlier this month, IMAX announced a new $50 million virtual reality fund with other strategic investors to help finance the creation of at least 25 interactive VR content experiences over the next three years for use across all VR platforms, including in IMAX VR™ centers. The IMAX's investment fund is a small, but important development for the company and for the VR industry at large.
For IMAX, the $50M fund is strategically important as the company continues to build a VR experience center network across the U.S., U.K., and around the world. Consistent with IMAX's market positioning as a premium entertainment brand, the global theater company has to provide unique, original VR experiences in order to compete with other location-based VR and out-of-home entertainment options. The IMAX investment fund is an important vehicle for spurring corporate innovation, sourcing ideas, and co-financing a portfolio of original VR experiences for IMAX customers. The move is similar to other funds IMAX has created in the past.
As we've observed over the past two years, there’s significant experimentation with location-based VR at amusement parks and dedicated VR facilities. For example, VR has become integral into some amusement park rides and has been given to people waiting for popular rides, meanwhile early indications are that dedicated VR facilities perform well on relevant metrics (e.g. utilization rates of the gear, repeat rates, group size), which bodes well for their continued roll out around the globe.
According to the 2016 Virtual Reality Industry Report, Greenlight Insights projects VR enhancements to amusement parks, dedicated facilities, and special-purpose VR installations will be a significant revenue market in the United States by 2026.
While $50M is not a large investment fund by most measures, at a macro-level, the new IMAX fund is an important development for the industry. The bottom line - right now, the industry desperately needs new sources of investment to fuel content development. Other investors in the fund include IMAX China, electronics hardware maker Acer, entertainment and sports firm Creative Artists Agency, media investment fund China Media Capital, British advertising firm WPP, the Raine Group, Studio City, and China entertainment company Enlight Media.
To learn investment trends, Greenlight Insights' in-depth analysis on the Location-Based VR section, and the trajectory of the industry overall, order the 90+ page Virtual Reality Industry Report now.