Dec 01, 2010

Augmented Reality Part Two: Challenges & Opportunities

Josh Williams's picture
Josh Williams
Director, Product Strategy

This is part two of my series about augmented reality. In part one, I gave a low down of the current market. Today I will focus the conversation around challenges and opportunities around this “new” market.

How are companies making money with AR?

There are a few companies that people mention when they talk about making money in AR.

One is metaio. They’ve been in the AR game a long time (they boast over 75 technology patents, a number they insist they throw out not to scare other players in the space, they just want everyone to know that their primary business is technology). They suggest the best way to make money with AR was by getting brands to pay you a lot of money to design and build something using AR. And metaio has some impressive proof points against that approach, including the Lego box kiosk demo, and the Iron Man demo seen below.

Another company that is doing well with the whole AR thing is Layar. Not only do they go after and win the brand dollars (“A major fast food chain wants us to develop an app for Layar… and while we’re at it do a media buy!”), they also license their platform to other agencies working in AR. They currently claim to have 2MM users of Layar, and that number is set to grow with the announcement of their Samsung partnership.

Total Immersion is competitive with metaio and Layar. Also profitable, and also owners of their own AR engine.

And of course game design was a monetization option for some companies, like E23, Ogmento, and others.

What are the big challenges AR faces?

There are a few big issues that AR will have to overcome before it becomes useful in a mainstream, “Even Mom’s are using it,” sort of way.

There’s a browser war going on in the AR space. Some of the more popular ones are Wikitude, Layar, and Acrossair. There are very few open source browsers, but there was one that was presented called SGARView. All these involve downloading an app to your mobile device. Other than that, there’s very little that’s standard or shared across these browsers; everyone uses their own proprietary technology, and manufactures don’t play with or talk to each other. Essentially, all the players are working in their own walled garden, and in the long run that’s likely a losing proposition.

So, establishing standards is a critical next step for AR. Some academics from Georgia Tech offered some hope on this front. I saw them demo of a web app AR browser called KHARMA, which uses KML, HTML 5, CSS, and javascript to deliver AR to mobile. The demo was pretty rough, but KHARMA represents a big first step in the direction of standards-based AR development.

Hardware limitations is also a big challenge for AR. Ideally, you’d be able to aim your iPhone down Market Street, and see precisely fixed labels pop up for relevant locations. But as I said before, inaccuracies in GPS and compass data means the registration of data in the AR display is going to be off, and the Ferry Building label is more likely to be floating over the Bay Bridge.

Personally, I think the biggest challenge to AR adoption is the dork-factor. There’s no cool way to walk around and use AR at the same time. The minute you start waving around your iPhone, you look like Spock taking planetary readings with his tricorder. The cognitive load that’s required to simultaneously operate and AR browser and interpreting the emergent data it displays gets subtracted by the attention required for walking, which means you either reduce your speed to baby steps, or you trip over the first curb you don’t see.

What are the opportunities for us in AR?

When I attended ARE2010, the opening keynote was from sci-fi-guy and Wired contributor Bruce Sterling. In his brief address, he suggested developers begin to ask themselves the question, “Ask: who’s reality needs to be augmented?” You’d think that was a no-brainer, but looking later at some of the AR demos being paraded around, I could see that the basic question “Who is this for?” was rarely being asked. Sterling suggested AR be used to improve the experience of “the blind, foreigners, the handicapped, and the bewildered,” or used to provide a missing frame of reference to those who’s world view needs widening.

AR is a solution in search of a problem. The digital marketers and game designers have been doing most of the work so far, but AR is reaching a point where it could find more consequential application. I think the next evolution for AR will be done by firms that are trying to solve real problems for real users. If that’s the case, I expect the work to be done by user-centered firms, like Hot, who start from a desire to understand and help the people they’re designing for.

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