Relatively speaking VR just isn't a significant share of the market, but it certainly is moving forward in its niche but not as fast as we would like. The main problems holding it back, I feel are (in order): price, game availability, and hardware (display resolution, primarily).
I did jump into VR just a few weeks ago when the Oculus was $350. A killer of a deal. So prices are coming down and will continue to do so. Once people start to realize you can have the experience of VR for the same price or even cheaper than a nice gaming monitor people will start to consider it more.
VR is awesome indeed but game availability and the low resolution display is still a problem for me. I do think higher res VR headsets will come out sooner than more, AAA quality games will though; which won't help it any. Which is why I don't really understand why big companies like R*, EA, Ubisoft, just to name a few aren't trying to get into this market with some quality games. If they did, I think VR would start to push forward a lot faster. They have the funds to do it, they just like their cash cows and wan't to keep them rollin'.
Once the price is good, there are good games, and the hardware quality is better; then we will have other issues like FPS game locomotion challenges to deal with. Teleport just isn't involving enough. Some attempts to solve this issue such as the Virtuix Omni may help, but there is a lot of work to be done here and there may never really be a perfect solution.
Most other game types though, like racing, flight, and even RPG and such really do work well with VR and I hope they will help push the VR tech forward.
So it certainly has a ways to go, but I don't think it is going to go away.