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A battle for the future of virtual reality gaming

Months after Facebook bought virtual reality headset maker Oculus and Sony announced Morpheus, virtual reality is grabbing the spotlight at the E3 gaming conference.

Neither Oculus nor Morpheus is available for sale yet, nor do they have price tags, but both are getting attention, as developers work on games for the new technology and gamers get excited to play with the headsets.

Sony gave an update on Morpheus Monday night, announcing two new demos for the game on the show floor. Andrew House, head of Sony Computer Entertainment, said during Sony's big press event that sales of its PlayStation Camera had been better than expected, and Morpheus was an extension of that.

"The technology behind Project Morpheus is amazing. Today at E3 and all week we'll be showing it on the floor," said Shawn Layden, CEO of Sony Computer Entertainment America in a first on CNBC interview Tuesday morning.

"We think that's going to take the whole gaming experience to a new level and allow people to really immerse themselves in their 360 world of gaming. It's new technology for us. We haven't announced a launch date because we're going to do a bit more work on it but it is the next level," Layden said.

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Sony's support of Morpheus is in part a reaction to gamer and developer enthusiasm for the Oculus Rift, which also has a presence on the show floor.

Oculus said this in its blog about some of the games in the works for the new headset: "It opens up all sorts of new possibilities for game developers and content creators, and we're thrilled to unleash it upon the community when it begins shipping next month."

A gamer wears a high-definition virtual reality (VR) headset, manufactured by Oculus VR Inc.
Matthew Lloyd | Bloomberg | Getty Images
A gamer wears a high-definition virtual reality (VR) headset, manufactured by Oculus VR Inc.

It's not just Facebook's Oculus and Sony's PlayStation hoping to cash in on the virtual reality trend—gamemakers are hard at work developing content.

A U.K. developer called nDreams is at the convention to announce a game called "The Assembly," which will be available for PCs with the Oculus Rift and on PS4 with Sony's Morpheus headset.

"There's an awful lot of money coming into virtual reality gaming. It makes things so much better for games that take you to another world, in another place, to be able to look around and feel like you're somewhere else," says nDreams CEO Patrick O'Luanaigh.

Crucial to the success of this technology will be affordability. Both nDreams' O'Luanaigh and Sony's Layden say they hope costs will stay low enough to draw a big user base.

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O'Luanaigh is optimistic about Oculus' potential now that it has Facebook behind it.

"The great thing about Facebook purchasing them is that they've got the money to really hit it hard and also to sell headsets at cost. For them it's about getting an install base," says O'Luanaigh. "The Facebook purchase gives Oculus freedom, room to make the best product they can."

As for which headset will win—it's still too soon to say. That depends quite a bit on how much—and which—content is available for both.

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