Augmented Reality – The Tripod.

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Success in AR will be supported by three factors.

• Virtual reality (VR) is at last starting to make an impact on the general consciousness but I think that it is augmented reality (AR) that has the best chance of really taking off.
• VR creates an entirely artificial world while AR superimposes objects on top of what one can already see.
• When I think about use cases, AR has far more applications that users are going to be willing to pay for in contrast to VR which looks to me to be limited to high end games and media.
• With this in mind, the big players are getting their ducks in a row in order not to be left behind if and when this medium suddenly takes off.
• Microsoft, Sony, Samsung Google and Facebook all have offerings in this area and there are range of start-ups like Atheer labs, Magic Leap and zspace to mention but a few.
• However, even if this really begins to gain traction, I see three main issues that a VR/AR provider has to get right in order to succeed.
  • First. Hardware.
  • The disaster of 3D TV where users were expected to don glasses shows very clearly that this will be a huge hurdle to the adoption of AR.
  • Today, all the devices that are in production or prototype stages are huge, clunky and uncomfortable.
  • To make this work, the devices need to be no heavier or intrusive than a regular pair of glasses.
  • There is still a long way to go but the players that gets there first are likely to have a big initial advantage.
  • Microsoft, Sony, Samsung and Magic Leap are who I would expect to get the hardware right first.
  • Second. User experience.
  • Whatever experience the AR system superimposes will have to be useful, engaging and fun.
  • Even in the enterprise these days something like this has to look good and be easy to use.
  • In the user experience, my money is on Facebook and Magic Leap although Microsoft’s HoloLens demos are pretty good.
  • Third. Ecosystem.
  • This is where the smaller companies and Facebook are going to fall over.
  • Just like IoT, TVs, Wearables and Cars, augmented reality is likely to be simply an extension of the digital ecosystem.
  • Users are going to want access to the Digital Life services they enjoy elsewhere within AR.
  • Consequently, every player hoping to make it in AR will need to have good coverage of the Digital Life pie or to have a legion of third parties willing to put their services into the system.
  • I suspect that this is why Magic Leap has just opened up its platform to third party developers as it has none of this on its own.
  • Google and Microsoft look to be the strongest here and I can see Google buying Magic Leap as it led the most recent $542m series B funding round.
• Hardware and user experience will be critical to getting in the game but I strongly suspect that it will be the ecosystem that wins it.
• Apple is nowhere in AR but I am sure that it is tinkering with it behind closed doors.
• This leaves Google in pole position with Microsoft in second if it can complete the missions it has set for itself (see here).