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Augmented reality and virtual reality (AR/VR) are arguably technology’s next big thing. Recent research from IDC reports the AR/VR market will reach $162 billion within four years, representing an impressive 181.3 percent compounded annual growth rate. Additionally, Gartner’s latest emerging technologies Hype Cycle plots AR and VR on the “Slope of Enlightenment.”
AR and VR are making a lot of noise. News around products, advancements, and companies getting in the AR/VR game appear daily. Last week’s inaugural (and sold out) Virtual Reality Developers Conference in San Francisco covered the latest trends and topics within this fast-growing industry. New technologies from key industry players like Google, Microsoft, Intel (to name a few) were displayed. Sessions were led by the likes of NASA, the White House and IBM. Talk about validation.
The consumer world has been acting as a guinea pig for the industry. A recent Nielsen study found that nearly one-fourth (24 percent) of U.S. consumers aged 18-54 said they will likely use or purchase VR in the next year and 20 percent said they had no plans to try it but then expressed interest after learning about the basics. And the industry is listening. Though a current challenge proves that demand for VR hardware and content currently outweighs supply, it’s likely this problem will be short lived. The New York Times announced Daily 360 VR News this month, and the new Google Tango phone is claiming the first AR smartphone for gaming and includes a few early apps for business purposes. As far as gadgets enabling the tech, Google’s Daydream VR headset is slated for release today. Intel is teasing its yet-to-be-realized major head-mounted display initiative, Project Alloy. It’s a wireless standalone VR headset optimized for its own brand of VR called “merged reality.” Whether this takes off or not is anyone’s guess, but the bottom line is leading technology companies are allocating big resources to AR and VR and it’s only on the rise.
While still in early stages, there are already many enterprise use cases paving the way forward. An early successful use case has been for virtual enterprise training. General Motors uses Google Glass to train factory workers in real time and to provide immediate feedback, with users seeing the correct techniques in their Google gadget as they perform their tasks. In another example, VR is being used to facilitate meeting alternatives with virtual meetings and tools for remote workers, saving on travel costs and time, while providing a more immersive experience. AR is enabling prototypes to be taken into the field to aid production, allowing designers to get a much better idea of how a product will appear and function earlier in the development process. The retail world has embraced AR and VR, offering a virtual experience for customers, allowing them to test products before purchasing.
From an investing perspective, market researcher Crunchbase recently reported that while funding across the board is more becoming selective than ever, AR and VR are among one of the very few tech sectors that are heating up at the seed stage. The research found that 40 AR/VR firms landed $45 million in seed and angel rounds this year. Last year, 39 companies raised $26 million. These numbers tell the story.
At Ascent we are excited about how AR and VR will continue to innovate in the enterprise and we’ll be exploring this in-depth at our upcoming B2B Forum on Dec. 6. Our impressive panel of experts will look at the the market drivers impacting adoption, how innovative businesses are taking advantage of AR/VR devices across different industries, and how we might cope with potential security risks. We’ll discuss the problems these technologies solve and the hotspots for enterprise investing.
Please join us at Ascent’s B2B IT Forum on Dec. 6, at the Microsoft New England Research and Development Center in Cambridge, MA. Register here.