"We think we are a true and compelling VR experience. It needs to be untethered, this is why we focused on head-mounted standalone devices," Anthony Murray, senior vice president and general manager of Qualcomm's internet of things (IOT) business, told CNBC in a phone interview ahead of the IFA tech conference in Berlin, where the product was unveiled.
Qualcomm is not looking to become a device manufacturer so it does not directly compete with the likes of Samsung, HTC and Facebook-owned Oculus which all have their own VR headsets. Instead, Qualcomm's closest competitor is Intel, which last month unveiled its own wireless VR reference design called "Project Alloy".
Although it is relatively young, the VR market has tremendous growth potential and therefore already has a large number of players. Sales of dedicated VR headsets such as the Oculus Rift and HTC Vive will hit 2 million this year, but increase tenfold to 21 million by 2020, according to CCS Insight. Smartphone VR headsets like the Samsung GearVR will grow from 14.5 million to 72 million in the same time frame.
Qualcomm's reference design as a camera inside to track a user's eye movements. On the outside, another camera can track hands so that the user can interact with the virtual reality images a user is seeing. This will also allow the helmet to be used for augmented reality. The company has also integrated the ability for 3D sound to make the VR experience feel more real.
Chipmakers around the world are having to contend with a slowing smartphone and PC market and look to new areas such as cars, 5G internet and virtual reality for future growth.
The Snapdragon VR820 is Qualcomm's first full headset and chipset reference design, but it currently makes the Snapdragon 820 processor for smartphones which it says supports "immersive VR experiences". It also released a VR software development kit (SDK) earlier this year to allow developers to create apps for devices running the Snapdragon 820 processor.
Qualcomm said that it expected the Snapdragon VR820 to be available in the fourth quarter of 2016 with the first commercial devices based on this platform to come out "shortly" after.