VR's First Major Casualty Was One of Its Smartest Startups

The big night in AltspaceVR is usually Wednesday. That’s when the social VR platform hosts its “Echo Space” dance party. While live DJs spin music, headset-wearing diehards from all over the world congregate at the center of a 360-degree video of the dance floor, jamming alongside them. It’s an odd sight: Humans and cartoonish avatars dancing in unison, each in their own world but connected through this strange new virtual-reality tradition. This past Wednesday was the 83rd installment of the event. It was also the last.

Last night, Altspace tweeted the unexpected news: ”It is with tremendously heavy hearts that we must let you know that we are closing down AltspaceVR very soon.” The site had been unable to close its latest round of funding, it elaborated in a blog post, and will be shuttering next week.

If deaths actually come in threes, then Silicon Valley already filled its quota this week. But none of the recent demises were unforeseen tragedies—not Microsoft Paint, not Adobe Flash, not even the iPod Shuffle and Nano. While they had lived long and happy lives, they were finished. Aging, obsolete, even security risks. We may miss them, but we won’t mourn them. Altspace occupied different cultural ground, though: its obscurity belied its importance. It was among the first companies to recognize that VR’s true power wasn’t in games or pointless escapism, but in other people. And now it’s gone.

Five years after Oculus’ famed Kickstarter campaign ignited the modern VR renaissance, the social side of virtual reality is just now beginning to get its due. Facebook’s Spaces app, which gives shape to Mark Zuckerberg’s real reason for buying Oculus in 2014, launched as a beta mere months ago. But Spaces is only the most recent of a spate of social platforms that proliferated over the past few years—and just about all of them were predated by Altspace.

The company first launched in 2013, when owning a headset was for only the earliest adopters. Even then, it knew that VR’s foothold depended on bringing people together—so rather than pouring its resources into dazzling graphics that only a high-powered PC could handle, it strove to create versions for all manner of headsets. Hell, you didn’t even need a headset; you could run Altspace on your browser.

Altspace didn’t induce you to spend hours tweaking your avatar; you chose one of six predesigned characters and an outfit, and that was it. The point was to find things to do, and to find people to do it with. So over time, it launched feature after feature with the sole purpose of turning strangers into friends. Roleplayers hosted Dungeons & Dragons sessions around huge tables in a virtual tavern, 20-sided dice dropping from the ceiling when needed. VR variants of Cards Against Humanity and Pictionary brought people out of their shell. In virtual dojos, avatars gathered for group meditations, or to watch YouTube videos on a giant screens.

During the 2016 presidential election, the platform partnered with NBC News to host “Virtual Democracy Plaza,” an environment where people could gather to watch the presidential debates between Donald Trump and Hillary Clinton or attend talks by Al Roker or Meet the Press host Chuck Todd. Podcasters recorded live episodes in Altspace, improv comedy troupes put on shows—and perhaps most enduringly, musician and comic Reggie Watts held a monthly Altspace residency. The company even granted him a custom avatar, instantly recognizable down to its afro, beard, and suspenders.

It was in those shows where you first saw the true promise of social VR—where new behaviors turned this halting new experiment into something that began to resemble a community. Altspace has long featured a reaction function; users can send smiley faces, hearts, or clapping hands streaming upward from their avatar's head. At live events, those reactions became the virtual version of holding up a lighter or a smartphone screen—a way for people signal appreciation without hooting into their microphone and disrupting the show. And at a Watts performance, the air would often be thick with hearts and smiles and clapping hands, floating heavenward through a ceiling that didn’t exist.

Was Altspace always easy? Nope. Was it ever awkward? God, yes. It was a rare session in Altspace when there wasn’t a robot asking vaguely creepy questions with a German accent, or an eight-year-old screwing up a game, or a lurker whose feedbacking microphone could clear out a room. But for all its peculiarities and incompletions, it was at least trying—and it was trying early, and often, and most of all consistently. One day, Altspace knew, its thousands of users would become millions. One day, price and horsepower and comfort and ease of use would constellate in just the right way and VR would tip from novelty to nature. And when that happened, the company would be ready.

That wasn’t to be. It’s likely not to be for a lot of other similar startups, either. Altspace might be the highest-profile casualty so far of the gotta-fund-’em-all VR gold rush, but it won’t be the last. While it may not have lived to be a titan, it will always be a pioneer.