“I do think that a significant portion of the population of developed countries, and eventually all countries, will have AR experiences every day, almost like eating three meals a day. It will become that much a part of you.”
—Tim Cook, Apple CEO
One of the top reasons startups fail is timing. No matter how brilliant the team, idea and technology are, get the timing wrong and the chances of success are slim. With Augmented and Virtual Reality, it feels like the right timing is always two years away. Until now.
Connecting the dots on some of the recent developments in the AR market (and to a lesser extent also VR), several of the ingredients are there for AR to go mainstream.
Vision – what comes after the mobile phone
In his vision for 2020, Mark Zuckerberg said it’s likely that AR and VR will be the next major platform after the mobile phone. His vision for the future of social is AR and VR to eliminate the distance between people and allow people to be present despite physical distance.
It also turns out that Facebook’s AI lab is working on lifelike avatar technology to make these experiences realistic and “radically change the way we connect through VR headsets and AR glasses tomorrow”. There are rumours that Apple will release its first AR headset in 2022, and AR glasses in 2023. Apple managers say that AR glasses sales may surpass the iPhone in a decade.
In the State of Technology in 2020, Benedict Evans suggested that now that nearly 6 billion people are connected via smartphones, the next likely future platforms include AR optics, VR and AR glasses.
Commerce – can you make money with it?
Large companies started embracing AR but it seems that only the very large media and retail ones: Nike, IKEA, LEGO, Disney, Amazon, etc. Now that’s about to change with Apple’s recent announcement to enable merchants to sell their products in-app with their Quick Look AR feature. This is big. As Mashable put it: “The company, with the help of its ARKit, has made iOS the biggest platform for Augmented Reality in the world right now”
It also turns out that embracing AR is very good for commerce conversion. Houzz shared that users who used their AR feature were 11 times more likely to buy. And build.com reported that users who used AR when making a purchase were 22% less likely to return the product.
Some companies like Niantic, creators of Pokemon Go, generated over a billion downloads, despite seeing some drop in players in 2017. According to the Verge, Pokemon Go broke new records in 2019 reaching $900 million in revenue through in-app purchases (r. It also drove $249 million in tourism revenue in 2019 with its walking events.
Talent – Demand for AR engineers soars
The market is seeing a huge surge in demand for AR developers. In comparing 2019 with 2018, according to Hired “global demand for AR/VR engineers up by 1,400%, gaming developers up 146%, security engineers up 49% but slower than in 2018”
All the large tech companies want a piece of the AR pie, as evidenced by the number of patents/inventions in AR in recent years.
- Microsoft is perhaps furthest ahead with its industrial application and controversial large military contracts for the Hololens 2.
- Google Glass is still alive as an enterprise product. Google Maps is overlaying AR on street view with the new ‘live maps’ feature
- Snapchat has Spectacles, and continues to build and acquire companies to improve its AR lenses for social
- Facebook is rumoured to be working on smart glasses with Luxotica (code name Orion)
- Apple is working on glasses, exposing AR functionality to millions of iphone users with ARKit
- Magic Leap, which might be off to a bumpy start, but could easily become the secret weapon of one of the four
So where are we now with AR adoption?
The trends are certainly positive, but the story of AR adoption is a classic “overnight success” that evolved over a decade.
Until recently, AR graphics still felt a tad cartoonish (there are exceptions) and the use cases were gimmicky (think filters on social media). Today, in retail, we’re already seeing AR tools used to create ‘magic-like’ experiences, as covered on VC Cafe a year ago. Whether you are measuring how the sofa fits look in the living room in the Ikea app or you’re trying on your favourite pair of snickers on the Nike app, AR still creates that sense of awe.
There are reasons to be optimistic about the long term future of AR, and I believe that in 2-3 years time, when smart glasses get to consumer hands, and 5G is more widely available, we will see the huge potential impact AR/XR can have on a range of areas from education/health to military/enterprise and of course gaming and entertainment. I’ll finish with a small dose of AR in 2020 and what experts predict will happen in Augmented Reality this year.
Here’s a flavour of an enriched future, according to Google:
Very soon we will have some exciting news coming out from Remagine Ventures about our latest investment in this space. If you’re an early stage founder obsessed about the future of AR (especially in gaming, entertainment, wellness and sports and infrastructure), we’d love to get in touch.
I'm a former general partner at google ventures, head of Google for Entrepreneurs in Europe and founding head of Campus London, Google's first physical hub for startups.
I'm also the founder of Techbikers, a non-profit bringing together the startup ecosystem on cycling challenges in support of Room to Read. Since inception in 2012 we've built 11 schools and 50 libraries in the developing world.
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Dear Eze, another excellent article. If you remember how the Internet wowed us the last 20 years, I think that AR/VR will wow us even more. The potential in engineering design is just now being explored. But it will take much more effort than it took to build social media and AI. Working on new people interfaces takes effort in every application. AI will help a little, but most apps will have to be done manually. Essentially before we are “done” with the world of “just machines” we are moving into new interfaces. What an exiting times to be around and observe the changes…