Why Enterprise VR Failed: Episode 1 — Overpromising and underdelivering?

© 2025 Rocinante Research, AI Generated

(Link to audio version of this essay)

Since the McDonnel-Douglas VITAL helmet in 1979, academia, consultants, enthusiasts, and techno-weenies have been promoting the benefits of Virtual Reality to the Enterprise. Before we can dig in to why things failed — it’s important to understand what VR benefits were sold to the Enterprise.

Episode 1 of this series will focus on the most common claims to determine if the Enterprise bought a first-class ticket on the hype train — or if they got their money’s worth.

The first real enterprise VR use cases weren’t dreamt up by some hoodie-clad disruptors in a WeWork. Nope. Back in the ’90s (yes, before the Oculus Era blew everyone’s minds by reinventing the wheel) VR was already being used for training and simulation in high-risk industries like aviation, military, and healthcare. Pilots, soldiers, and surgeons were honing their skills in safe, virtual environments long before Mark Zuckerberg decided we all needed avatars with no legs). These simulations offered less risk, lower costs, fewer real-world disasters — sounds great, right?

Early VR, however, had significant challenges. It was ridiculously expensive, clunky, and about as scalable as a homemade database running on an intern’s laptop. Which meant only enterprises with bottomless budgets and a questionable sense of financial responsibility could afford it (like governments, academia, the military, and a few corporations). And yet, here we are, decades later, with tech bros breathlessly proclaiming they’ve just discovered… fire.

Did VR do all the things the salespeople and consultants promised?

Ah, the pure joy of analyzing these promises — like unwrapping a big birthday present, only to find a smaller birthday present box wrapped inside… and another… and another… until you finally hit the last one which contains a $5 Starbucks gift card to thank you for signing up for the beta.

ENTERPRISE VR BENEFITS

Consultants pitched enterprise VR as a magical cure-all for… well, everything. Just look a list of some of the headlines shared over the years:

1. Revolutionize training! Employees will be smarter and learn faster!
2. Transform meetings! You’ll love collaborating in virtual spaces!
3. Streamline product design! What could go wrong?
4. Show customers the future before it’s built! No pressure
5. Save lives with surgical simulations! Just like a video game!
6. Reduce travel costs! Who needs to go to Barcelona for a conference when you have VR headsets?
7. Improve Employee Well-being and Engagement! Whatever that means.

Here’s the thing: VR can technically do all these things. And, yes, there’s experiences and data to back that up (including a 2020 study I co-authored). But just because something can work doesn’t mean it will work. And let’s face it, most of these pitches came from VR enthusiasts, salespeople, consultants, or founders who’d job it is to sell you something.

“Sure, our consumer VR headsets do not collect personal data and I’m pretty sure they are 100% secure! All you need to do is sign this 3-year non-negotiable contract, pay us six figures a month, and we’ll get you something in 18 months.”

Let’s break down these promises, share the hype, summarize the reality (with studies and references for those that need to double-click), and close with Rocinante’s thoughts.

Table 1 was created for those that suffer from TLDR syndrome. If that’s you, glance at that and then jump to the conclusion. You’re welcome.

As another famous bald person once said, “Engage”

TABLE 1: FOR THOSE THAT SUFFER FROM TLDR SYNDROME

1. Revolutionize training! Employees will be smarter and learn faster!

THE HYPE

• Employees taught via Virtual Reality learn faster and retain information longer
• Employees taught via Virtual Reality are smarter than those students that attended a class or took an e-learn module
• Learning by doing improves memory retention compared to reading or watching videos.

THE REALITY

• According to research by PwC, employees trained via VR were up to 4X faster at learning compared to classroom learners and 275% more confident in applying their skills post-training.
• The benefits of using VR include a greater engagement with respect to traditional methods (Concannon; Conrad ) but also the possibility of better applying experiential learning and social constructivist approaches (Concannon).
• ATM published a study in 2021 that highlighted students had improved pass rates than those students using traditional training modalities. While the term “smarter” is subjective, academia has been using various metrics such as learning speed, confidence, engagement, and retention to evaluate VR’s efficacy and the results are positive.
• Another study found that VR’s immersive and interactive nature enhances training outcomes by simulating realistic environments where employees can practice skills and make decisions without real-world repercussions.

ROCINANTE: You betcha! Like, totally true — seriously, this is spot on.

Just don’t expect Gary from accounting to take a VR course on Advanced Underwater Basketweaving and suddenly emerge as a “Nautical Fiber Arts Specialist.” Best case? He learns to weave a basket underwater. Worst case? We refer him to HR to explain why he is walking around the office in a scuba suit.

• Traditional training methods — like classroom learning or e-learning — often struggle to mimic real-world scenarios. Why? Because recreating expensive equipment isn’t exactly budget friendly. Plus, let’s tell the truth — how many times have you actually paid full attention during an e-learning module? If clicking “Next” while half-watching Tik-Tok videos was an Olympic sport, we’d all be gold medalists.
• Humans usually learn best by doing — it’s just how we’re wired. Of course, that’s a generalization, but if the old saying “Those who can’t do, teach” has any truth to it, then surely “Those who actually do the work, just wing it until they figure it out” must be equally valid!
• The key reason VR is so effective? It traps learners in a digital world where distractions can’t reach them! No Instagram, no doom-scrolling on X — just you, your lesson, and the terrifying realization that there’s no escape until you can demonstrate you learned something.

2. Transform meetings! You’ll love collaborating in virtual spaces!

THE HYPE

• Traditional video conferencing and cloud-based collaboration software often lack the personal interaction and engagement of in-person meetings.
• VR meetings can enhance communication, engagement, and user satisfaction compared to traditional video calls
• Meeting and collaborating in VR bridges this gap by creating virtual workspaces where employees can collaborate in 3D environments, interact with digital objects, and feel present with their colleagues, no matter where they are in the world.

THE REALITY

• The Journal of Advances in Information Technology completed a systematic review and examined cognitive load in highly immersive VR environments. The review analyzed 46 empirical studies, discussing trends, benefits, challenges, and measurement methods related to cognitive load in high-immersion VR settings.
• A study by PwC Switzerland found that VR meetings can lead to a 16% improvement in communication and a 58% greater sense of closeness to colleagues compared to traditional video conferencing. Participants also reported feeling 15% more comfortable in VR meetings, suggesting that the immersive environment may foster better engagement and interaction.
• A study in Frontiers in Virtual Reality highlighted that while VR meetings offer unique spatial aspects and atmospheres, challenges such as the importance of seeing participants’ faces for effective communication were noted. Participants emphasized that facial expressions play a crucial role in communication, and the lack of realistic facial cues in some VR platforms can hinder interaction.
• Research has identified shortcomings in traditional video conferencing, such as limited support for communicative and social behavior, which can lead to “Zoom fatigue.” Emerging VR solutions aim to address these limitations by providing more immersive and interactive meeting environments.

ROCINANTE: Overall, the hype is kind-of-true (i.e. not an outright truth, but not a lie) and great for companies with dispersed workforce. It will not be replacing Zoom, WebEx, Teams, or any of the other 500 video collaboration solutions any time soon. But, for the right use case — it works well..

• Hosting a large meeting in VR is great — finally, a place where dressing like Barbie isn’t a problem! But it’s not the best fit for every TYPE of meeting or collaboration. There are challenges, like awkward avatar eye contact, headset accidently dying disasters, and the very real risk of someone’s Wi-Fi turning them into a frozen, floating torso. Sometimes, I dare say, in-person meetings, still have the edge! — but when used right — it’s great not having to come into the office or fly to Dubai for a client workshop.
• Works great for groups of 5–100, but, if you have a very large group (i.e. 15+), you need to plan out your meeting and treat it like a workshop). 100+ people? OMG it’s like trying to manage sugared up ‘tweens on crack cocaine, it’s technically possible, but hard to manage. If all you are doing is speaking to a crowd — stick to Zoom. If you want to socialize a concept, collect feedback, brainstorm ideas, etc. — you know — an interactive meeting — the sessions are just as productive as if you had everyone in the same room. It works, but it does take planning.
• Will you LOVE collaborating in virtual spaces? It depends — do you enjoy talking to legless avatars, do you get frustrated easily while trying to write on a virtual whiteboard, does it freak you out when an avatar’s head just falls off because they took their headset off in real-life to send a text? If not, welcome to the future.
• NOTE: I’ve hosted more than 1000 immersive meetings using VR. I think only a few people like Chris Madsen at Engage XR and Christoph Fleischmann at Arthur Technologies have hosted more. I’ve helped close multi-million-dollar consulting deals, created onboarding for employees, taught classes, facilitated board meetings, run operations for disaster relief, not to mention team building sessions such as watching the Champion League finals or big NFL game parties with workmates and friends. I’ve used everything (Immerse, Altspace, MESH, Horizons, Spatial, Glue, Engage, Facetime (AVP), and Arthur). I’m a big fan — but there are issues which will be discussed in the episode on User Experience: You want me to wear this clunky thing for HOW long? This was THE killer app during the pandemic and ideal for companies with remote and very dispersed workforces.

3. Streamline product design! What could go wrong?

THE HYPE

• In industries such as architecture, engineering, and product design, VR enables teams to collaborate in real-time on 3D models, allowing them to adjust and visualize changes as if they were in the same room.
• This level of collaboration fosters innovation and streamlines decision-making processes.
• Real-time adjustments, instant visualization — so futuristic!

THE REALITY

• A study published in the IEEE Xplore digital library examined the adoption of VR technology in industrial design education. The research analyzed qualitative data from industrial design students and discussed the limited adoption of VR, suggesting that increased integration could enhance design processes and outcomes.
• A review in the journal Electronics examined VR applications in engineering and product design. The study categorized 86 sources into multiple classes, confirming that VR is potentially useful throughout the entire design process, from early conceptual stages to detailed phases and subsequent product evaluation. The findings suggest that VR can streamline product design by enhancing visualization, facilitating modifications, and improving overall design efficiency.
• Research presented at the Design Research Society conference explored the integration of VR tools into industrial design research. The study highlighted how VR creates immersive, three-dimensional environments through visual and audio simulations, offering a reliable and flexible tool for design. The increased accessibility of VR has expanded its use from large industries to broader design applications, facilitating rapid prototyping and iterative design processes.

ROCINANTE: Absolutely, no fibbing here, but be careful as there’s a catch.

• Great in theory and effective for specific applications, but don’t expect it to revolutionize every single design process overnight.
• VR can improve collaboration in design-heavy industries. But only if the workflow makes sense. If your team still argues over basic file formats, good luck.
• VR is a valuable tool, but not a revolutionary force in design. It shines when used in the broader product design process… especially when your boss insists on blessing every pixel with their ‘superior’ design instincts.
• If your workflow sucks, no headset is going to fix it.

4. Show customers the future before it’s built! No pressure.

THE HYPE

• VR prototyping enhances customer engagement, provides valuable user insights, and improves the ability to collect how users feel by allowing them to interact with and provide feedback on products or services before they are built.
• VR can recreate service experiences in a highly immersive, agile, and cost-effective manner, allowing users to have a representative service experience and enabling designers to extract high-quality user feedback.
• VR allows customers to experience products or environments virtually before making a purchase.

THE REALITY

• Academic research supports the assertion that utilizing Virtual Reality (VR) to present customers with prototypes of future products or services offers significant benefits. A study published in Multimodal Technologies and Interaction examined the application of VR in prototyping service journeys. They introduced a new service prototyping method called the “VR service walkthrough,” which was evaluated through an empirical comparative study.
• A critical analysis focusing on the luxury industry concluded that VR’s main impacts include improved communication with consumers, the creation of immersive experiences, and enhanced customer loyalty.
• The Journal of Consumer Marketing explored the impact of immersive spaces, such as the metaverse, on the customer experience. The study examined consumers’ motivations to use metaverse spaces and analyzed how various dimensions of virtual environments affect the overall customer experience, including cognitive, affective, behavioral, and social outcomes. It highlighted implications for theory and practice related to immersive spaces and the customer experience, benefiting metaverse designers and customers alike, and influencing brands’ marketing strategies that increasingly focus on incorporating immersive spaces.

ROCINANTE: So true, it hurts.

• Guessing what customers want is so last century. Letting users poke, prod, and play with a product beforeit’s built means fewer surprises, better feedback, and less “Well, that was a terrible idea” moments.
• In real estate, automotive, and retail, VR turns “just looking” into “shut up and take my money.” Browse a Malibu mansion in your pajamas, no awkward realtor required. Take a Lambo out for a spin without worrying about speed limits or wrapping it around a tree. Try on a hundred outfits virtually — no judgmental store clerks.
• Shopping without dealing with people? Yes, please. More engagement with a product, more confidence, and fewer buyer’s remorse therapy sessions.

5. Save lives with surgical simulations! Just like a video game!

THE HYPE

• VR simulations are the ultimate training experience.
• VR simulations are safe.
• VR simulations are cost effective!
• VR provides a risk-free environment where employees can simulate dangerous or complex situations without the associated risks. For example, in the oil and gas industry, workers can practice emergency responses to hazardous conditions without stepping foot on a drilling rig.
• Similarly, in medical fields, surgeons can refine their skills through virtual procedures without putting patients at risk. In other words, you can practice dangerous and complicated procedures without blowing anything up or killing someone (which tends to cost a lot more than the cost of creating and managing a VR experience).

THE REALITY

• A study published in Cureus compared the costs of VR training to traditional live exercises for hospital staff. Initially, VR training was slightly more expensive per participant. However, over a three-year period with repeated sessions, VR training became significantly more cost-effective, demonstrating notable long-term savings
• Research presented at the Construction Research Congress 2024 proposed a cost-benefit analysis model for implementing VR in construction companies. The study identified various cost and benefit factors and utilized a Monte Carlo simulation to assess potential net benefits. The findings suggested that VR implementation could be a promising investment for construction firms.
• An article in Medicine examined the cost-effectiveness of VR simulators compared to traditional wet laboratory training. Despite higher initial capital costs for VR simulators, the study found that their relatively low recurring costs favored long-term cost-effectiveness.

ROCINANTE: Yup, VR simulations are the ultimate training cheat code; it’s the real deal.

• VR simulations blend hard and soft skills into a hyper-realistic emulator, letting employees experience real-world scenarios without the risk of actual disaster (or lawsuits).
• The all-star use cases? Workplace safety, emergency response, disaster preparedness, driving and flying simulators, medical and surgical training, customer service, and conflict resolution — basically, any scenario about screwing up in real life would be very expensive or very embarrassing.
• If you’re only looking at development costs, traditional training wins every time. But if you factor in the long-term benefits, VR starts looking a lot more attractive — kind of like a gym membership you actually use.
• The real magic of VR is in long-term savings: fewer accidents, faster time-to-proficiency (TTP), improved quality, better retention, and fewer costly mistakes. Basically, VR pays off if you zoom out and do the full ROI math. And don’t worry, we’ll dig even deeper into this in episode aptly named Corporate L&D: Where Good Tech Dreams Go to Die to double-click into the ROI.
• Bonus perk — VR eliminates the need to build large training centers, dealing with broken machinery, or worrying about trainees setting things (or people) on fire. It’s all virtual, and in VR, the only real danger is putting an executive into a headset and having them get sick.

6. Reduce travel costs! Who needs to go to Barcelona for Mobile World Congress when you have VR headsets?

THE HYPE

• VR significantly reduces the need for business travel, as employees can attend meetings, conferences, or training sessions from anywhere in the world. In a globalized economy, this not only cuts down on travel expenses but also reduces the time spent traveling, allowing employees to be more productive.
• Collaboration technologies like VR can lead to annual savings of $11,000 per remote worker says the Global Workplace Analytics study.

THE REALITY

• The Global Workplace Analytics study from 2011 is often cited as a benefit of VR collaboration. However, the report talks about collaboration tools specific to telecommuting long before VR entered the Enterprise. To be fair, Global Workplace Analytics has published many studies since highlighting the cost effectiveness of remote work and work from home using collaboration technologies. It is not a stretch to include VR in this bucket of technologies.
• Other studies from McKinsey & Company and Avatour highlights the cost savings of using VR for meetings, tours, conferences, and site inspections.
• VR Vision Group, in partnership with Toyota, stated Investments in VR technology have demonstrated favorable returns. For example, Toyota achieved significant cost savings in training materials and reduced travel expenses by implementing VR training programs, recouping their initial investment within three years.

ROCINANTE: Very true for face-to-face meetings and workshops of 4–50 employees — false if you are hoping to replace conferences, expos, or invite external participants.

• Meeting in VR will cut travel costs without tanking meeting quality — just strap on a headset and go! Bonus: it might even make workshops less painful, but like any tool, you need to use it correctly.
• Small virtual meetings (2–4 people)? Perfect for Teams or Zoom as nobody can hide. More than 4 attendees in Zoom? i.e. 2 people talking most of the time, and the rest of the attendees are in a multi-tasking free-for-all. More than 4 employees are where VR shines as you must pay attention as there really is no multi-tasking. Great for engagement, terrible for execs trying to secretly text their EA about where they want to eat dinner tonight.
• Right now, about 50–70 people can meet in VR without issues. I’ve been in sessions with over 100, but once you cross that threshold, you are rolling the dice and not everyone’s experience will be stellar. Not to mention, you’ll need extra admin referees to keep the confused from rage-quitting.
• Inviting external guests to internal VR meetings? Unless you enjoy IT audits and career-limiting moves, think twice. (Full rant will be shared the episode: The IT Problem: Compliance, Security, and Other Joys of Enterprise Tech).
• VR for workshops? Yes. Conferences? Hard no. No one wants to visit empty halls, crappy content, and awkward networking all at the same time.
• Last time I checked — the cost of going to Mobile Work Congress in Barcelona from the US, including flights, hotels, and meals was about $10,000. I can buy 30 Quest 3s’ for $10,000 and still have change for coffee. Until conference producers see VR as more than a fun gimmick, major shows won’t be ditching the overpriced convention halls anytime soon — so yes, please take this $10,000 and let me go to Barcelona in March!

7. Improve Employee Well-being and Engagement! Whatever that means.

THE HYPE

• VR is more fun! Learning becomes an adventure rather than a chore, leading to higher engagement and voluntary participation.
• VR can be used to offer employees virtual relaxation experiences, such as guided meditation or nature walks, to help reduce stress, burnout, and improve mental health.
• VR can also be used to engage employees through gamification, turning mundane tasks or training into interactive, rewarding experiences.

THE REALITY

• BMC Medicine published a study in June of 2024 that VR is a more engaging and enjoyable method for delivering emergency clinical simulation training.
• Frontiers stated “The Use of Virtual Reality to Influence Motivation, Affect, Enjoyment, and Engagement During Exercise: A Scoping Review” (2020): Although focused on exercise contexts, this review highlighted that highly immersive VR environments positively impacted users’ enjoyment and engagement levels. The findings suggest that VR’s immersive nature can be leveraged to enhance motivation and affect in various settings, including workplace training.
• Simon Riches et.al published in 2023 analyzed 17 studies involving VR interventions aimed at enhancing employee well-being. Most of these studies implemented brief, single-session VR experiences featuring relaxation tasks such as meditation, breathing exercises, and exposure to nature-based stimuli like forests and beaches. The results demonstrated the feasibility, acceptability, and effectiveness of VR in improving well-being-related variables, including stress reduction and relaxation.

ROCINANTE: Yes, yes, yes, we get it. VR is fun, exciting, and supposedly the future of workplace engagement. The answer is false, but what are they not telling you?

• VR is undeniably fun, and learning becomes less of a soul-sucking obligation and more of an actual experience, which should lead to higher engagement and participation.
• Companies, until recently, were all about making work fun! And what better way to do that than with VR-powered stress relief, mindfulness sessions, and team-building exercises? The catch? Employees must actually use it.

And therein lies the problem. In my experience, after the initial “oohs” and “aahs,” employees treat VR wellness programs like that expensive exercise bike collecting dust in the corner — exciting at first, completely ignored by week two.

CONCLUSION

So, after all that, what have we learned?

Enterprise VR is like a promising first date — lots of potential, plenty of excitement, if you ignore a few glaring red flags.

But the promises they made — in general are not red flags — overall, those promises were true. Well, as true as a politician’s promise that they will balance the budget. I want to be clear, they WANT to balance the budget, but there are other things that are preventing them from actually executing. And that is what kinda happened with Enterprise VR.

Let’s not kid ourselves — if the benefits were really that amazing and those sales reps and consultants were really telling the truth, why isn’t every employee rocking a headset right now?

The tech is real, the benefits are measurable, but sadly, most (funding) executives just want to say they’re investing in VR without committing to using it. Because nothing screams “future-ready company” like forcing employees into a mandatory VR onboarding session… that the executives have never attended.

Or, a far more likely scenario… these executives got a first hand taste of how impossibly hard it is to deploy enterprise VR, how building VR applications feels like coding with oven mitts on during a tornado, and how changing company culture is basically trying to teach a cat to do your taxes. And if my name were Daniel Doinkleman — SVP of Unrealistic Expectations — I’d bet none of this was on their executive bingo card.

At its best, VR is a game-changer, giving enterprises new ways to train, collaborate, and prototype without the hassle of real-world consequences. At its worst? It’s an underutilized gadget collecting dust in a forgotten IT closet — right next to that “cutting-edge” corporate wellness program nobody asked for and that internal app they put on a blockchain.

Well friend, it turns out reality IS A BIT MORE complicated. Just like Ted said, “Strange things are afoot at the Circle K” which is exactly why we’ve got six more episodes in this series to untangle this glorious corporate train wreck called Enterprise VR and uncover what or who is the villain of our story.

Next up: “Strapped-in and Let Down: How Enterprise VR Got Duped by Consumer Tech.” Episode 2 will deep dive into the mess that was enterprise Oculus/Quest, while also examining how HTC, Pico, Lenovo, and HP tried (and failed) to build headsets that employees or IT would want.

Buckle up VR Enthusiasts, this is where things get interesting.

Published April, 8, 2025, © 2025 Rocinante Research

About the Author

Daniel Eckert retired from 29-years of consulting in late 2023 after spending 8-years on the front lines of Enterprise VR, preventing big companies from overhyping, under-investing, or half-baking VR solutions. He also co-authored the landmark paper The Effectiveness of Virtual Reality Soft Skills Training in the Enterprise which is cited 322% more often than the average Major League Baseball post about the financial conspiracy behind overpriced hot dogs. Daniel now spends his semi-retirement as a Principal at Rocinante Research. (Yes, the name is a Don Quixote reference. Yes, it’s ironic). Check out some of his other articles on Medium.

Articles in the “WHY ENTERPRISE VR FAILED” series:

• Why Enterprise VR Failed — The Prologue (Published April 1, 2025)
• Episode 1 — Overpromising and underdelivering? The Benefits of Enterprise VR. (Published April 8, 2025)
• Episode 2: Strapped-in and Let Down: How Enterprise VR Got Duped by Consumer Tech (Coming April 22, 2025)
• Episode 3: Enterprise VR Software Tools: Like Building a spaceship with a spork (Coming May 2025)
• Episode 4: The IT Problem, or How the middle finger can be used as a pointing device (Q2 2025)
• Episode 5: Corporate Learning and Development: Where good ideas and dreams go to die. (Q2 2025)
• Episode 6: User Experience: “You want me to wear this clunky thing on my head for HOW long?” (Q3 2025)
• Episode 7: VR/Spatial Consultancies: The rise and fall of the Metaverse Industrial Complex (Q3 2025)
• Why Enterprise VR Failed — The Epilogue, or WTF can I do now to turn this all around? (Q3 2025)