There’s no doubt about the potential of Augmented Reality (AR) and mixed reality (XR) and the role they play in advertising, social media, commerce, gaming etc. I’ve written about the potential of AR on VC Cafe in 2020 (the stars align for AR to go mainstream) and again in 2021 (the tipping point for 3D content is now) and while consumer adoption has grown (as I share in the images below), there’s yet to be an ‘iPhone moment’ for AR.
I believe the iPhone moment is going to be the launch of Apple’s smart glasses (or maybe Meta’s) and when it happens, I predict we will see accelerated adoption of AR technology for both consumer and enterprise use cases, and a rush to adapt products to from 2D to 3D.
The writing is on the wall – AR continues to grow
According to the latest survey by AR Insider, 30 percent of U.S. adults have used AR at least once in 2022. 30% of those who used AR, use it daily.
Mobile AR frequency survey (source: AR Insider)
In its 2021 global consumer report, Snap predicted that 75% of the global population and nearly all smartphone users will be frequent users of AR.
The companies making the biggest impact on the future of AR
In this post I wanted to touch on the companies who are making the biggest impact in the AR space, both in terms of product development and the developer ecosystem tools they are releasing to power the next generation of AR experiences.
For disclosure, at Remagine Ventures we are investors in Echo3D, a CDN and CMS for 3D content in the cloud and Zoog, an interactive AR platform for families, bringing stories and games to life.
Meta
Mark Zuckerberg is a big believer in his vision for the Metaverse and sees AR as an important piece in that vision. While VR is more immersive, and Meta owns Oculus, the first mass scale VR headset, AR is more accessible (to anyone with a smartphone) and is a good place to start with an immersive, 3D Internet experience.
Meta is pushing to launch its smart glasses, dubbed Project Nazare, in 2024, and Mark is the driving force behind the project:
Meta’s CEO also sees the AR glasses, dubbed Project Nazare, as a way to get out from under the thumb of Apple and Google, which together dictate the terms that apps like Facebook have to abide by on mobile phones. The first version of Nazare is designed to work independently from a mobile phone with the assistance of a wireless, phone-shaped device that offloads parts of the computing required for the glasses to operate. A marquee feature will be the ability to communicate and interact with holograms of other people through the glasses, which Zuckerberg believes will, over time, provide people with a more immersive, compelling experience than the video calling that exists today.
Mark Zuckerberg’s augmented Reality, The Verge
Despite the big vision, Project Nazare isn’t expected to be a mainstream device. It will be most likely indoor-only and with a battery life that lasts only a few hours. Mass adoption of smart glasses as a whole (depending also on their future price) might take a decade.
Meta is successfully engaging with AR creators and users via Instagram already, and has a growing Spark developer community building AR social filters.
Apple
According to recent reports, Apple AR Glasses expected release will be sometime in 2023 and are expected to cost somewhere around $499. Apple has been preparing long for this moment, and you can expect great interoperability between the glasses, the iPhone and Apple Watch. But with great expectations comes great responsibility, and Apple has yet to make an official announcement about the release of its smart glasses.
Could Apple be the most significant player in the AR space? absolutely. Its cult following and hardware expertise are most likely to win over Meta or Google, and Apple’s massive developer ecosystem will give Apple an edge in pouring content/apps into this expected new device.
From patent filings we learned that Apple glasses might project images directly on the eyes and that the lenses might be used to automatically correct vision.
Snap
Snap sees itself as a Camera company first and foremost and has been the leader in consumer AR adoption. Last May, Snap released their new AR-enabled version of Spectacles and called them “the new Spectacles”. The product isn’t available for sale like in previous version, but rather was given out for free to about 200 creators in 30 countries who filled an online form.
Like Meta, Snap has a booming developer community who uses Snap Lens Studioo to build AR social filters: Over 250,000 developers have published a total of 2.5 million lenses, which have been viewed over 3.5 trillion times in aggregate (source).
Magic Leap
Magic Leap has been through a pivot. After billions raised and no mass adoption consumer product, Ronnie Abovitz, who founded the company in 2010, stepped down as CEO in Sep 2020 and made room for Peggy Johnson, a senior Microsoft and Qualcomm exec, who focused the company on Enterprise B2B, rather than consumer products, directly positioning Magic Leap in competition with Microsoft’s Hololens.
About a month ago, the company unveiled Magic Leap 2, a smaller and lighter device:
The focus of the new AR headset is on three segments of the enterprise market: health care; public sector and defense; and manufacturing and industrial settings. Within those sectors, three use cases will be targeted from the start: training, 3D visualization and remote assist. Remote assist means you can call an expert from anywhere in the world who can see what you’re seeing and what you need repaired, and then walk you through a fix.
Magic Leap 2 Aims to Bring AR to Businesses, With No BS This Time, Cnet
Others
- Google – after a misfire with Google Glass (which was shut down and relaunched as Glass Enterprise for industrial use such as factory workers), and after sunsetting its VR efforts and bringing them back to life following Facebook’s ambition to build the Metaverse, Google has had a mixed patch with Augmented Reality, but it also has several live useful use cases for mobile AR enjoyed by billions.
- Put a penguin (and other animals) in your living room
- Translate text by simply pointing your phone at it with Google Lens
- Live view in Google Maps
Google’s AR Core developer platform also attracts developers to create simple but powerful AR experiences.
- Microsoft – Hololens is perhaps that most advanced enterprise AR product today, which is already in use by doctors, the US army, construction and other industrial use cases. Priced at $3,000 per unit, it’s still out of reach for most.
They are also the only ones to publicly share the long list of organisations using their product, which you’ll have to agree is an impressive bunch:
- Mojo Vision – the AR contact lens company unveiled its latest prototype of Mojo Lens last month and share the news of a $45M round of funding and a partnership with Adidas, hinting at the company’s intention to target the sports market first.
- Niantic – the company behind Pokemon Go has already made billions from AR gaming and continues to acquire companies in the AR space including 8th Wall last month and NZXR a few weeks ago. In November 2021, Niantic announced Lightship, a free AR developer kit.
Peridot, the latest AR game by Niantic which will feature virtual pets, is still in development.
Absent from this list is AWS, which has yet to announce big plans for the AR space, both in the hardware and software front.
“Gradually, then suddenly” said famously Ernest Hemingway, and I believe that will be the case with AR and 3D content once it experiences its ‘iPhone moment’. A rising tide raises all boats, and while its hard to predict who will be the winner in this space, there’s no doubt that advances in technology and changes in consumer behaviour make it an attractive bet for the future.
We’re excited about AR, VR and XR at Remagine Ventures. If you’re a seed/pre-seed/bootstrapped startup building in this space, we’d love to hear from you. You don’t need a warm intro to contact us, simply email us with some context at info@remagineventures.com.
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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