The future’s made of virtual…. reality

“Forget your virtual reality, oh, there’s nothing so bad” sang Jamiroquai famously in his 1996 release “Virtual insanity”.

Whilst the song was indeed a hit, Jamiroquai’s prediction was perhaps slightly wide of the mark as here we are in 2016 and the subject of virtual reality in FinTech is the talking point of the season among some of the largest consultancy firms in the world.

Deloitte has published research that shows that although this particular virtual reality (VR) technology is still in its infancy, especially with regard to commercialization and research and development, it has got to the point at which it is becoming a viable proposition in many areas of business.

The research shows that virtual reality headset-based environments could proliferate all manner of industry sectors, citing that this year may conclude with the sale of 2.5 million headsets and 10 million games, amounting to a billion dollars in revenue.

Whilst management consultancies and auditors are looking at virtual reality being used in certain sectors such as the purchasing of vacations or selecting options on new car models including interior trim levels and exterior colors without having an actual car in the dealer showroom, the FX industry is looking at it through a very different lens.

Virtual reality trading platforms have been notable by their absolute absence, despite this industry being one of the most technologically advanced business sectors in the world.

There has only been one exception to this thus far, which perhaps unsurprisingly, is Tom Higgins, CEO and founder of Guildford-based MetaTrader 4 integration technology company Gold-i.

Mr. Higgins is blessed with a very innovative mindset, a facet which pervades every aspect of the business he built up, and whilst the major consultancies and big electronics firms are only starting to talk seriously about virtual reality in mid-2016, Mr. Higgins spoke almost a year ago with Andrew Saks-McLeod, CEO of FinanceFeeds at a meeting in Switzerland about the dawn of the first virtual reality trading platform.

During that conversation, which began with discussing how trading platforms may become ‘wearable’ in future, on devices such as the Samsung or Apple watches, some FX companies which have proprietary platforms having already launched watch-based applications.

This conversation moved on quickly to the possibility of expanding wearable devices to virtual reality headsets – something that had never been discussed in the FX industry before, and perhaps may have, at the time, been viewed as a very tenuous presumption as to how the future may unfold, however nowadays this is looking like a very accurate prediction by Mr. Higgins.

Mr. Higgins explained “The watch is now a reality, people are wearing them, lots more people will wear them and there will be apps for monitoring or closing positions. You wont have charting or algos, the screen is too small, but the trading functionality will be there.”

“I have a friend who is building virtual reality software for trading platforms. The current development consists of four to five different virtual reality platforms, in which a you put a headset on, and you’re in another world, and when you move around, the world moves around with you so you can effectively walk around in a virtual world” he said.

“I have this great idea that you could use this to walk around in a three-dimensional chart, exploring your trading positions, you can use your hands to be able to explode your positions as the sensors work out where your hands are moving and replicate this within the virtual reality headset. You could do your analysis, drag charts up and down, and what an exciting world that would be!” – Tom Higgins, CEO, Gold-i

Our observation on this was that the development of such a wearable virtual platform would remove some of the problems that the Google Glass faced, which contributed to its demise, in that the Google Glass was permanent, whereas a VR headset is purely usable for the purposes of trading, and will be removed when the user needs to move to another subject.

Mr. Higgins concurred, and said “Yes, I agree, and I think that people find the idea of Google Glass a bit spooky. I think the reason Google killed it off is because it was getting banned in too many places and it was not going in the right direction in that Google does not want to be seen as spying on people.”

Indeed, with virtual reality headsets, the wearable device is dedicated for one specific purpose and does not feature any ‘functional piggybacking’ such as that of a watch or spectacles, that could cause social disdain. Imagine the lawsuits should an accident occur as a result of a pedestrian watching the head up display inside spectacles rather than watching where he is going.

On this point, Mr. Higgins explained “What will likely happen is that, because the idea was actually good, Google will take the idea, and advance it in a different way. What is going to make this possible rather than just space age, is companies like us which will perform integration so that people will be able to buy it off the shelf.”

“Very few brokers can develop their own technology, unless they are very large” said Mr. Higgins. This brought us onto an important point in that even for firms that spend a fortune developing their own systems, this is a revolutionary, new product the development of which would perhaps be a very risky investment for even the most FinTech-savvy firms.

“We invest 60% of our development resources into R&D and we allow our developers to explore unusual things. If one of the developers wanted to spend 20% of his time looking into virtual reality, then he could certainly do that, and he could then have the time and resources to come up with something really innovative and really interesting” – Tom Higgins, CEO, Gold-i.

It is clear that most companies experience a narrow age band which has experienced the rapid development that we have seen today. This means that companies will have to make constant developments to engage the next generation when they become the target customers of retail FX firms. They will get to the point where it will be too costly and too resource hungry to innovate away from the norm, however will have to differentiate themselves from the similar firms with off the shelf, almost identical systems in order to stay abreast with technological requirements from the Millenials.

Mr. Higgins concluded, almost one year ago, with an absolutely correct prediction of where the virtual reality technology will begin to become very relevant indeed “When all of the software toolkits and the hardware is ready, which will be around the end of 2015, I think that by mid-2016 we will be at the point at which we will begin to see this technology begin to be in people’s hands.”

We at FinanceFeeds cannot wait to see it!