Most virtual reality headsets need to be tethered to PCs or smartphones; few are self-contained. A new VR chipset from Allwinner could change that, and also drive down headset prices.

Allwinner's H8VR chipset could free VR headsets from being attached to smartphones or PCs. The H8VR can fit in a plastic or cardboard VR headset, and it has a CPU, 4K video processing capabilities, memory and storage.

The H8VR is targeted at low-cost VR headsets. Allwinner's chips are already being used in low-cost smartphones and tablets, and the company played a big role in driving down mobile-device prices. The H8VR could do the same for VR headsets.

One VR headset with the chip, the V3 All In One, is selling for $109.99 on Geekbuying's website and is available for $129.99 on Aliexpress.

VR headsets like Oculus Rift and HTC Vive need to be attached to PCs due to heavy computing and power requirements. Mobile devices can also be plugged into headsets for VR.

Top chip makers aren't developing specialized processors for independent VR or augmented reality headsets, with Qualcomm being an exception.

One popular stand-alone AR headset is Microsoft's HoloLens, which uses Intel's Cherry Trail processor -- that chip, however, was made for tablets, not specifically for VR or AR. The VR strategies for Nvidia and AMD rely on their PC GPUs.

Meanwhile, Samsung's new Galaxy Note 7 can be used for VR with a companion Gear VR headset. One of the chips used in Note 7 is Qualcomm's Snapdragon 820, which is also being targeted at VR headsets. The chip has digital signal processors and a powerful GPU to amplify sounds, scenes and to recognize images, all of which improve VR.

That leads to a larger question: like Allwinner and Qualcomm, will the top chip makers consider a specialized VR chip, much like they do for tablets and smartphones? It's a possibility, if VR headset shipments explodes. IDC projects 9.6 million headsets to ship this year, reaching 64.8 million by 2020.

The H8VR has an eight-core ARM Cortex A7 processor, an Imagination Technologies PowerVR SGX544 GPU, 16GB of storage and 2GB of DDR3 memory. It is a variant of Allwinner's H8, used in set-top boxes, but formulated for the VR headset in a smaller chip package.

One caveat: Buyers need to consider whether low-cost VR headsets provide a smooth visual experience, otherwise users can get nauseous or sick. The Allwinner H8VR chip will not equal the graphics quality of the Oculus Rift and HTC Vive, which rely on powerful PC GPUs. With that in mind, users may want to try it before buying.

The popularity of a VR headset also depends on content availability. For example, content for Samsung's Gear VR headset won't work on the $109.99 V3 headset with an Allwinner chip because of software and hardware compatibility issues.

A lot of VR development is happening around Google's DayDream platform, which is based on Android 7.0 (code-named Nougat). DayDream is designed for mobile devices but could come to headsets; the hardware requirements, though, may be too overpowering for low-cost headsets with Allwinner chips.