With hardware being launched and software emerging, virtual reality is one of the hottest technologies today. For hundreds of Seattle-area engineers, game developers and others, it’s a time to watch their work hit the market.

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Virtual reality is making the leap from the drawing board to the living room.

The first two products in a new generation of high-end virtual-reality headsets started shipping to consumers in the past two weeks, a major milestone for a new set of hardware that some boosters say could rival the smartphone in its impact on the way people work and play.

The recent release of Facebook-owned Oculus Rift and the Vive, built by Bellevue’s Valve and Taiwanese phone maker HTC, is the biggest test to date of whether consumers are interested in a device that wraps an immersive screen around their face.

It’s also a coming-out party for hundreds of Seattle-area engineers, game developers and other technologists who have been working to commercialize the once far-fetched technology.

Meanwhile, a cluster of startups is watching the market evolve, polishing their software with the goal of releasing them into a more mature VR market down the line.

“Everybody is on pins and needles,” said James Green, co-founder of Carbon Games, a Bellevue video-game studio whose “Air Mech: Command,” is among the first games available at launch for Oculus. “It’s the first new (type of) screen we’ve had since the television.”

“Air Mech: Command” by Bellevue-based Carbon Games is available at launch for Oculus Rift. “It’s the first new (type of) screen we’ve had since the television,” said Carbon Games co-founder James Green. (Video courtesy of Oculus)

Virtual-reality devices replicate an environment that a user can interact with. They’ve existed in one form or another for decades, with some video-gaming-focused headsets in the 1990s trying, and failing, to reach a mass- market audience.

This time around, increased computing horsepower and cheaper hardware components brought about by the smartphone revolution make it possible to create immersive experiences without making the wearer nauseous.

That’s drawn efforts from technology giants, startups, and investment firms to make virtual reality the next must-have gadget.

Initially, the market for the high-powered devices released recently — which require a powerful, expensive personal computer to pair with it — is likely to be small, analysts say.

The natural audience at first probably consists of gamers accustomed to shelling out hundreds of dollars for new hardware. The Oculus Rift costs $600, while the Vive starts at $800.

Other, cheaper options on the market that might find a wider initial audience are Samsung’s Gear VR, developed with Oculus to accompany the South Korean company’s smartphones, and Google’s Cardboard viewer.

Later this year, Sony is expected to release its PlayStation VR to accompany its video game console.

Different applications

Analysts expect the coming virtual-reality headsets to find applications in industries ranging from sports and live events to medicine and retail.

Seattle-based online real-estate brokerage Redfin has a pilot project using virtual reality to let prospective buyers tour homes remotely. Researchers at the University of Washington have explored VR’s applications in pain treatment and teaching.

Analysts with Goldman Sachs expect 3.8 million headsets to ship worldwide this year. By 2020, they expect that figure to rise to 42.9 million.

Five years later, Goldman says, virtual-reality hardware and software will be an $80 billion-a-year industry.

“There’s no shortage of examples of how (virtual and augmented reality) can reshape existing ways of doing things,” analysts with the investment bank said in a report earlier this year. The technology may grow “from niche use cases to a device as ubiquitous as the smartphone.”

Hotbed of activity

The Seattle area has emerged as one of the hotbeds of VR activity, building off the region’s researchers and software and hardware engineers, video-game studios and design talent.

“Because a lot of the key components of the platform are here at the beginning, it may turn out to be one of those industries where Seattle punches above its weight,” said Forest Key, co-founder of Seattle VR video-technology startup Pixvana.

Seattle has competition as a VR hub from the likes of Los Angeles, with its video and video-gaming entertainment talent, as well as San Francisco.

Oculus, which began as a crowdfunded effort before Facebook swooped in and acquired it for $2 billion, established a local research-and-development office in 2014. It’s the company’s largest office outside its Menlo Park, Calif., headquarters.

Valve, Bellevue’s swashbuckling gaming company, and partner HTC, which has its North American headquarters in Seattle, produce the Vive headset.

In Redmond, Microsoft is working on spurring developer interest in its HoloLens augmented-reality goggles, which display images in the environment around the user.

Cool things

In between, startups and established software makers are working to come up with cool things to do using the headsets.

Oculus last year approached Hidden Path Entertainment, a Bellevue game studio, about making a VR game.

Jeff Pobst, the studio’s chief executive, thought at first that Oculus wanted “Counter Strike,” and that he’d have to say no. The rights to the hit first-person shooter series, which Hidden Path pitched in on, belonged to Valve.

Instead, Oculus was curious about an adaptation of “Defense Grid 2,” Hidden Path’s tower defense game.

Among the Oculus Rift launch titles is “Defense Grid 2” by Bellevue-based Hidden Path Entertainment. Jeff Pobst, the chief executive, calls the VR gaming experience “so compelling, it’s so different from anything else.” (Video courtesy of Oculus)

Such tabletop-style games, which give the wearer an overview of the action in one field of view, might be better suited for VR than first-person shooters or other games with unpredictable and potentially nausea-inducing camera movement.

Pobst’s team beefed up the visual aspects of their game, adding detail so that their environment of alien worlds looked realistic even if the player leans in to examine a forest or waves on a beach.

“Defense Grid” is among the launch titles for Oculus.

“I’m really excited about virtual reality in general,” Pobst said. “The experience is so compelling, it’s so different from anything else.”