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The Next Big Thing

Chinese toy and animation tycoon joins virtual reality race with new headset and gaming centre

PUBLISHED : Tuesday, 23 June, 2015, 6:30am
UPDATED : Tuesday, 23 June, 2015, 10:38am

Last month I got a taste of what a roller-coaster ride feels like without actually being in one. And all it took was a pair of virtual reality (VR) goggles. Although I was seated firmly in a cocoon-like chair, it wasn't long before my heart leapt out of my chest as the visual illusion induced the dizzying sensation of hurtling along tracks that looped, dived and swung out again.

Unveiled at a Shenzhen cultural industry fair in May, the goggles are being produced by toy and animation tycoon Zhuang Xiangsong in partnership with Shenzhen company Virtual Reality.

Zhuang has grand ambitions for the goggles, which could become a key driver for his China Animation Group. Besides creating an additional platform for the company's stable of cartoon characters, he hopes the device can grab a slice of an emerging global market for VR entertainment.

He says his company has developed more than 10 apps for the goggles. While the roller-coaster ride used digital imagery, other apps use real footage to recreate the experience.

"Our travel apps provide real images of the environments, like Google Maps. One such app takes people to Tibet on a high-speed train, seeing the view along the tracks," Zhuang says. "Another recreates the whole city of Kashgar in Xinjiang that people can walk around in."

Applications for the goggles can be limitless, Zhuang says, as they have created a platform that will be open to the public to develop content for, and which goggle buyers can download.

"You will be able to watch an action-packed IMAX movie, explore a maze and visit historical sites like the Dunhuang caves [in Gansu], all from home."

China Animation Group is entering a crowded landscape as companies from Oculus to HTC, Lenovo, Sony and Samsung rush to bring virtual reality devices to consumers.

Priced at 1,900 yuan (HK$2,400), the goggles will first go on sale at a VR gaming centre due to open in September in Shanghai. The facility is part of Joypolis, a 176-million yuan indoor amusement park that China Animation operates under franchise from Sega Corporation of Japan.

The 1,000 square metre first phase, which opened in December, has an area dedicated to cosplay and a huge interactive digital aquarium where aquatic creatures bolt from the screen at the touch of finger. The remaining sections are set to open in the fourth quarter of this year, with rides as well as a 4D cinema where virtual characters walk out of the screen to interact with audiences wearing 3D-glasses.

A trained engineer, 45-year-old Zhuang entered the toy business in 1992, making animation characters for Japanese companies such as Sega and Takara Tomy. He set up his own toy manufacturing company in Hong Kong in 1996 and became a fluent Japanese speaker through regular dealings with clients from the country.

He founded China Animation in 2007 just as the field was starting to take off on the mainland. However, Zhuang aims to take on the world with the company, which raised HK$319.8 million when it listed in Hong Kong this year.

"To break out of China, we need to create our own characters. We have over 20 of them now, including a Tibetan antelope figure and a kung fu kid. But before we go global, we have to be the top animation brand in China first. China has the technology and talent, but we lack creativity.

"We need the imaginative plots of Japanese [anime], so we are collaborating with them to make animation movies and TV series which will be shown in both Japan and China."

They're off to a promising start with the successful introduction of a character: Violet, a purple-haired adventure-loving pop star, which has garnered a substantial following in China.

Building on this base, they had Violet perform in 3D holographic form (the first such appearance in China) in February, alongside Chinese boy band M.I.C. and other pop stars before a packed 7,000-capacity stadium in Shenzhen.

Violet is also a key character in their Shanghai theme park, and will soon be presenting weather broadcasts on TVS in Guangdong, and appear at a concert in Kitec in September.

"We hope she will generate half of our company's revenue from spin-offs, including concerts, movies and video games," Zhuang says. This is much like how the Japanese developed a market for the character Hatsuen Miku.

Following the deal with Sega, Zhuang hopes to build a string of Joypolis parks across China, as Sega has done in Japan and Dubai.

We let outside developers create content for our VR operating system
Zhuang Xiangsong, founder, China Animation Group

"I have visited indoor theme parks around the world, and Sega's Joypolis is the top brand globally. They can pack lots of intricate things in a small area.

"Ours is the first theme park in China based on animation. Disney will soon follow with its theme park in Shanghai, but competition is a good thing.

"While they are located on the outskirts in Pudong district, a two-hour drive from the city, we are situated right in the city centre. Admission for our park is 200 yuan, which is not much for today's affluent Chinese who like to pamper their only child."

With about 30 million permanent residents in Shanghai and many more in surrounding counties, Zhuang believes there will be no shortage of visitors to his parks.

After all, the country is on the cusp of a theme park boom. Last year, the central government approved the building of a 20-billion-yuan Universal Studios theme park in suburban Beijing; and property giant Wanda Group, which also owns the world's largest cinema chain, announced it would build 200 children's theme parks by 2020.

Zhuang says his Joypolis parks will offer a different experience than the rest. "We will have mixed reality (MR) shows with Violet performing alongside real people. We have augmented reality (AR) offerings. Holding their phones, visitors can venture into a forest and see beasts jumping out at them.

MR and AR have been around for several years, but Zhuang's company will be the first to use the technology in a theme park in China.

"There are a couple of companies which have put VR goggles into production. Besides our Shenzhen partner, the other is Oculus. After being bought by Facebook [for US$2 billion last year], Oculus has concentrated on developing content. We don't want to follow what they are doing. So we roll out the goggles in our theme park and let outside developers create content for our operating system."

They have also reduced the sense of vertigo that older generations of VR goggles tends to induce through a technology dubbed "9D", he says.

"People used to feel dizzy because there was a 13 millisecond lag [for image] after they turn their heads. To avoid dizziness, the head and the image have to turn at the same time. Our latest version has shortened that lag."

At 1,900 yuan, China Animation goggles may seem a steal compared with the US$1,500 that Oculus executives estimate will cost to run their headset, but the latter price includes a PC powerful enough to ensure seamless, immersive video graphics.

Eric Abbruzzese, an analyst covering VR/AR, digital content and consumer electronics at ABI Research in the US, says China Animation's goggles has potential for success.

"China is a market that has not seen as much attention surrounding VR as other geographies, but there will no doubt be interested customers. Competing with the big names such as Oculus and Samsung will be difficult, but not impossible. Focusing on the unique elements of the Chinese market should bring more success than attempting to emulate other companies in different markets."

Without having tried China Animation's headset, Abbruzzese says it's difficult to gauge technical claims, but adds "their comments are in line with what other companies are focusing on as far as reducing input lag and dizziness, supporting developers and content.

"Public development is a good choice, since it will expand the potential developer and content base very quickly; however, there will need to be some form of moderation to ensure the quality of this content meets their expectations.

"Content is imperative for the success of these devices, and their announced games and content are similar to what we are seeing in other markets such as simulation, travel and navigation."

Zhuang and his team will be watching how visitors respond to their goggles and to the VR gaming centre in Shanghai.

"If the response is good. We will sell them online so that people can play games in the comfort of their own homes," he says. And the concept of VR centres may be exported to Japan and Southeast Asia.