AltspaceVR Shutting Down

AltspaceVR, the popular virtual reality social platform, and the eponymous company behind it, will be closing their respective doors on August 3rd. This is surprising, as AltspaceVR has been around since 2013, was well-funded, had a good amount of users given VR’s still-niche status, and had apparently more funding lined up to continue operation and development of their platform (that funding falling through was, according to the announcement linked above, the primary reason for the impending shut-down).

But besides the direct impact on commercial VR as a whole, and the bad omen of a major player closing down, this is also personal to me. Not as a user of AltspaceVR’s service — I have to admit I’ve only tried it for minutes at a time at trade shows or conferences — but as someone who was, albeit tangentially, involved with the company and the people working there.

After having given a presentation at an early SVVR meet-up, I invited SVVR’s founder, Karl Krantz, to visit me at my VR lab at UC Davis. He made the trip a short while later, and brought a few friends, including “Cymatic” Bruce Wooden, Eric Romo, and Gavan Wilhite. I showed them our array of VR hardware, the general VR work we were doing, and specifically our work in VR tele-presence and remote collaboration. According to the people involved, AltspaceVR was founded during the drive back to the Bay Area.

In addition, I co-advised one of AltspaceVR’s developers when he was a PhD student at UC Davis, and I visited them in the summer of 2015 to give a talk about input device and interaction abstraction in multi-platform VR development. During that visit, Eric Romo also gave me my first taste of the newly-released HTC Vive Development Kit (Vive DK1).

For all that, I am sad to see them go under, and I wish everybody who is currently working there all the best for their future endeavors.

Possibly related to this, another piece of news surfaced today: AltspaceVR was named defendant in a patent infringement lawsuit filed by Virtual Immersion Technologies, LLC, regarding this 2002 patent. I do not know whether this filing was a cause in AltspaceVR’s closing, but it is possible that the prospect of a costly court case, or stiff licensing fees, led to some investors getting cold feet.

Either way, this patent deserves closer scrutiny as it is quite broad, and has recently changed ownership from the original inventors to the plaintiff, who has so far been using it exclusively to sue VR companies for infringement. The fact that it specifically claims the use of video to represent performers or users in a shared virtual space might mean that it covers platforms such as our tele-collaboration framework, which would be unfortunate. I have a hunch that this patent, due to its arguably broad applicability, will be the subject of a major legal battle in the near future, and while there is a lot of prior art in multiplayer/multi-user VR, that video component means I cannot dismiss the patent out of hand.

7 thoughts on “AltspaceVR Shutting Down

  1. This was just a matter of time unfortunately. There is simply no money to be made in VR at the moment. The biggest most popular breakout hit game (Raw Data) barely broke $1m in sales. It is going to take a few more generations of hardware until true mass adoption hits.

    • I don’t think it’s categorically true that there’s no money in VR, but in AltspaceVR’s case, they didn’t have any monetization figured out yet, so for them it was literally true.

      • Absolutely. I should clarify with “there is no money in consumer VR apps developed for Vive/Rift, distributed on SteamVR with an install base of ~250,000 active users.”. It’s exciting though, that this has created a golden age for indie devs and bedroom hackers to make a living. But the market is too small for a social platform to reach the critical scale necessary.

  2. Thanks for digging up the actual patent Olivier. I looked it over and it does look quite similar to any sort of “more than one user in a virtual room” scenario. This is, of course, completely indefensible and reminds me of the time back in the early 90’s when Unisys threatened to sue over the use of LZW compression in GIFs — so anyone/everyone using them had to pay like a $5000 license fee. This lawsuit may very well have had an impact on their inability to raise a B round.

    • I didn’t dig up the patent; reddit did in the thread I linked.

      It’s good that you brought up LZW, because that is a good counter-point. My problem with several recent VR patents is that the ones that turned infamous were deeply flawed. Either they were trying to patent things that were obvious or had precise prior art (like Valve’s attempt to patent Chaperone), or they were legitimate inventions whose patents were worded and awarded too broadly, like this one.

      Compared to those, the LZW patent was basically unassailable. It was a novel and improved variation of another (genius-level) invention, was narrowly described, and fairly awarded. When CompuServe decided to use LZW for GIF, they did not do their due diligence. They should have checked whether LZW was patented; as it was, their use of it was clearly infringing. In short, CompuServe screwed the pooch.

      What followed was really not the fault of Unisys. They were the target of a hatestorm because GIF had become immensely popular by the time Unisys even found out it existed and used their patented algorithm. Unisys were even reasonable in their licensing terms, not requiring a license or a fee for non-commercial or non-profit applications, and reaching an early agreement with CompuServe themselves and most makers of GIF-creating software. Their 1999 move to a flat licensing fee, which again didn’t apply to non-commercial or non-profit users, and neither to users who had used license-covered applications such as most graphics programs to greate GIF files (meaning, probably more than 99.99% of users), was poorly communicated and resulted in yet another round of torches and pitchforks. LZW is much more a tale of bad publicity and Internet overreaction than one of a bad patent.

  3. Doc you gotta fight for AltSpaceVR, you have the knowledge to fight these rat bastard virtual cyber bullies in court. What do they think, they own VR?

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