Varjo Brings High-Fidelity XR Streaming To The Cloud With Varjo Reality Cloud

Still from the new Varjo Reality Cloud Platform. VARJO

I have followed Varjo since it launched its first VR headset just before MWC 2017. Since then, I have tried all of its subsequent headsets and products and had a front row seat to the company’s evolution. Varjo now offers a broad range of high-end headsets, including the Aero, the VR-3 and XR-3, which address a diverse group of applications and customers. Like many in the XR space today, though, Varjo was and is an enterprise-first company. As is the case with many emerging technologies, success in the enterprise is the first step to driving wider adoption of XR and crucial to its long-term success. Aware of this dynamic, Varjo has engaged in several enterprise projects, including partnering with Lenovo and offering its high-end headset through Lenovo’s ThinkReality platform.

Additionally, Varjo has been working on a cloud software solution to provide a virtual space for collaboration between Varjo XR users in a spatial environment. This culminated in today’s launch of the Varjo Reality Cloud. Varjo’s CTO, Urho Konttori, and Chief Brand Officer Jussi Mäkinen walked me through the platform over Zoom since I could not attend the company’s press tours through NY and SF. I’d like to share my initial takeaways from the announcement. 

Varjo Reality Cloud

Varjo’s Reality Cloud seeks to enable its many different Varjo headset users to collaborate in a shared virtual space without any barriers. The Varjo Reality Cloud (VRC, not to be confused with long-forgotten Virtual Reality Company) runs on Amazon’s AWS cloud services (AWS EC2 G5) with NVIDIA’s A10 GGPUs with ray tracing capability. One of the VRC’s unique secret sauces is its use of a foveated transport algorithm. This is different from foveated rendering which happens locally. Foveated transport enables the Varjo Reality Cloud to determine precisely where a user’s eyes are directed, render that in full resolution and stream the rest at a much lower resolution. The foveated transport algorithm allows users to stream high-fidelity immersive content from VRC to their headsets with lossless visual fidelity, a compression rate of 1000:1 and a bandwidth of only 35 megabits per second. This is equivalent to streaming a 4K HDR movie on most services, which is relatively low considering this is a high-fidelity XR experience with 3D visuals.

Another still from the Varjo Reality Cloud platform. VARJO

Varjo’s primary demonstration of VRC leveraged Autodesk’s VRED for automotive design. Jussi demonstrated how he could walk around the virtual vehicle and then peer through the car’s virtual windows. I could see him through those windows even though the car wasn’t real—a mind-blowing moment for me. The company plans to enable more applications than just automotive design—Varjo says it will open the platform to more developers, including those that use Unity and Unreal Engine for their projects.

Additionally, Urho and Jussi demonstrated how engines like Unreal could take advantage of VRC to show how virtual humans might look in the Metaverse if the quality was not sacrificed to save GPU compute power. Varjo says it also plans to support non-headset devices, like the iPad, soon, but there is no concrete information on that yet. 

VRC in Market

In both demonstrations, the way the VRC rendered and streamed virtual objects felt virtually seamless. I’m hoping the platform will help Varjo expand the footprint of its headsets into a broader array of systems like laptops which have previously not been powerful enough to drive Varjo’s high-fidelity XR experiences. Previously, Varjo’s headsets required systems with top-of-the-line 300W+ GPUs inside desktop machines. Now the VRC can in theory juice any PC to stream VR content, securely, from the cloud, instead of having to do it all locally. Varjo’s Reality Cloud is currently available for $1,500 per month for five concurrent Autodesk VRED users. The company says it will expand into more applications in time.

Varjo is not alone in this space. Campfire also offers its own headset and holographic collaboration solution that leverages Amazon’s AWS cloud, which already supports iPad and non-headset users. While I believe Varjo with VRC and Campfire do have some overlap as complete solutions, their approaches are somewhat different and target different users. Ultimately, I think the two platforms will serve different customers and solve different problems while expanding the overall XR market.

Wrapping up

The Varjo Reality Cloud is an example of how the XR industry is moving towards platform-based solutions that seek to integrate existing tools and enhance existing workflows. Of course, Varjo’s Reality Cloud also creates another recurring revenue stream for the company on top of the headset software licenses it already charges. I don’t think everyone with a Varjo headset will want to use VRC, even once their applications are supported (especially defense customers). Still, I could see it becoming popular with high-fidelity applications like product design and engineering, including automotive. Spatial enterprise collaboration continues to grow as a sector and I believe it will encourage more enterprise users to start using XR headsets across organizations—not just within the engineering departments. I am excited to see what the VRC’s added compute power enables for what was already one of the most high-fidelity premium headsets on the market.

Patrick Moorhead

Patrick founded the firm based on his real-world world technology experiences with the understanding of what he wasn’t getting from analysts and consultants. Ten years later, Patrick is ranked #1 among technology industry analysts in terms of “power” (ARInsights)  in “press citations” (Apollo Research). Moorhead is a contributor at Forbes and frequently appears on CNBC. He is a broad-based analyst covering a wide variety of topics including the cloud, enterprise SaaS, collaboration, client computing, and semiconductors. He has 30 years of experience including 15 years of executive experience at high tech companies (NCR, AT&T, Compaq, now HP, and AMD) leading strategy, product management, product marketing, and corporate marketing, including three industry board appointments.