Google's big announcement at Wednesday's I/O developers conference event, held at an outdoor amphitheatre near Google's headquarters, was a virtual reality platform called Daydream designed to work with the Android mobile operating system.

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Daydream addresses latency and other issues affecting playback on smartphones, according to Clay Bavor, Google's vice president of virtual reality.

Bavor also announced a virtual reality headset powered by a smooth, two-button controller with orientation sensors that help determine positioning in virtual environments. Facebook is also making a big push in virtual reality with its Oculus headset, and Apple has indicated its interest in VR technology as well.

Bavor also said the division has "rebuilt YouTube from the ground up" to feature improved audio to support virtual reality screening.

Google offered no timetable on the VR headset, but said Daydream-ready phones would likely hit the market by autumn.