It seems like the lifecycle for a wearable augmented reality product is to release an impressive tech demo, raise a ton of venture funding, utterly fail to attract consumers, then quietly pivot to the enterprise. While media coverage may be quick to declare these platforms “dead,” many of the most notable are thriving within the much less visible enterprise market. What is it about AR that makes it so hard to sell to consumers, yet attractive to large organizations?
Transcript of Checksum Episode 4: Why is the Enterprise the Home for “Dead” AR?
What’s something that no one asked? Compare aspects of technology to the houses from Game of Thrones? Shouldn’t we have done that before the show ended? GREAT IDEA, I said to myself.
Well, social media is clearly House Lannistar, seemingly resplendent in riches but ultimately hollow on the inside and destined for self-destruction.
The open source community must be the wildlings beyond the Wall. Initially feared by the “respectable” houses of the south as the destroyer of civilization, only to be co-opted to defeat a greater threat.
I guess in this scenario Microsoft is House Stark and the White Walkers are… patent trolls. Yeah, that works.
So who would have the unenviable position of being the Greyjoys? Well, that would be augmented reality…. because what is dead, may never die.
As for Checksum? Here we stand…
So the idea of augmented reality has a long history in technology, and especially in science fiction. You have things like “robot vision” in Terminator showing the idea of having a computer overlay on top of what an eye is seeing. My first exposure to the idea was that Next Generation episode “The Game” where an AR game brainwashes everyone and somehow the teen is the only person onboard who doesn’t want to play an addictive video game. Also a bonus early Ashley Judd cameo.
But when AR went from being a trope in sci-fi or at best a terrible CES demo to something that approached a consumer device was undoubtedly Google Glass. Ever since Google co-founder Sergey Brin skydived into Google I/O wearing one of the devices, it changed the feel of the category from If to When wearable AR was a thing.
Then something happened. People actually got their hands on these first-generation wearable AR devices and the first impressions were… not kind. Google Glass got a special kind of ire. Maybe it was because of it’s $1500 starting price. Maybe it was the fact that you needed to be invited to have the opportunity to give Google money for what was clearly an early adopter device. Maybe because it’s aggressively sci-fi appearance was… well kinda dorky. But people most seemed to have an issue with the fact that it included an eye-level camera that gave no indication when it was in use.
From its initial Glass Explorer private beta release in 2013 to the more open availability in May 2014, the story of Google Glass on the consumer level effectively ends in 2015 with the end of the Glass Explorer program. At the time, lots of outlets were quick to point at Glass as being too early to the market with an unfinished product. But then something happened. It turns out that Glass had found a home and applications all over the enterprise.
Glass was successful enough in the enterprise to generate it’s own SKU, the creatively named Google Glass Enterprise Edition. This was originally released in 2017 exclusively for fleet sales to large organizations and was successful enough to call for an updated 2nd edition in 2019.
Google isn’t the only one. Microsoft took a more cautious approach to its Hololens AR headset, eschewing pretentious invites and pricing its clearly named Developer Edition at a developer price of $3000.
Whether they learned from Google Glass or not, Microsoft made the wise move of never really presenting the Hololens as something you would wear around all the time, instead making the form factor clearly designed for shorter-term sessions within a closed environment.
Of course, being a tech company, for every boring productivity app, Microsoft also made sure Hololens had some consumer-facing demos like games and media experiences. This was partly to tie it to their whole Windows Mixed Reality platform, but it had the unfortunate effect of whetting people’s appetite for a consumer edition. While HoloLens is now in its second edition, released in early 2019, some in the tech press are quick to say it’s a failed or dead AR platform. But again, we see Microsoft finding buyers in the enterprise.
And even actual AR failures seem confident that a pivot to the enterprise can be their saving grace. In the AR hype cycle, there is perhaps no more shameless player than the vaporware experts at Magic Leap. Backed by billions in venture funding and breathless descriptions of what their tech could do, Magic Leap was always eventually targeted as a consumer device. Even as actual glimpses of their technology were fleeting and the impressions always qualified enthusiasm. And although a consumer edition was eventually released in 2018 as some bizarre AT&T exclusive device, in April the company announced it was laying off half its staff and abandoning its consumer plans. Instead, the company plans to continue a shift to the enterprise.
So why does AR seems to work well for the enterprise but not consumers? Enterprises are able to focus on what they want to get out of an AR platform. An expersive wearable AR platform is a big ask for a consumer, especially compared to a smartphone. Consumers are used to a fairly open app ecosystem where they have a surfeit of choice for what they want the platform to do. AR, due to lack of developers and limitations of wearable hardware, has both a performance and utility shortfall. Plus let’s not underemphasize the importance of aesthetics. These devices generally look cringeworthy, versus the very sleek and polished phone landscape. There’s a reason that where AR is generally successful with consumers, it’s in single use novelties, where you open up a phone app, and you know exactly the experience you want, rather than something more open.
Enterprises are literally designed to overcome all of these shortcomings. From a utility standpoint, enterprises have use cases in mind when considering these platforms. For them, it’s not an open platform that needs to justify itself; its a development platform with a unique UI. Development isn’t a problem because in most cases, enterprises are developing the software that will run on these devices, so there’s no software gap to really overcome, or at least not one that enterprises aren’t already comfortable addressing.
Right now the big verticals adopting AR are healthcare, oil & gas, mining, and defense, where they find a niche in helping to train massive workforces as well as streamline routine tasks (like maintenance) that are more prone to human error. It also doesn’t help that these are all industries where there’s generally a workplace uniform, meaning the AR wearables have less of a visible stigma as well.
Even though AR isn’t the most common or pervasive technology in the enterprise, it’s no surprise to see AR companies targeting them. Given that they can be specially developed for a given vertical, devices don’t have to hit a mass consumer price point for enterprise to throw some capital expense money at a fleet of AR devices. With that comes long service contracts and steady income that can be used to further fuel development.
But what’ll be interesting to see is if the shift in remote work during and after the COVID-19 lockdowns will change AR from this more industrial setting, into a further tool for remote training, collaboration, and communication. There are definitely applications for these types of AR uses, and Microsoft is well poised to pivot on them if they gain momentum, but right now they are still the exception with enterprise AR. If the idea of a physical office for many employees becomes a thing of the past, I think we could see AR really pivot into enterprise remote offices. And if it does, that could soon be the gateway for AR’s re-emergence onto the consumer side as well.
Hey, thanks for watching this episode of Checksum. Be sure to subscribe to the Gestalt IT YouTube channel to these and shows like the Gestalt IT Rundown in your feed every week. And let us know in the comments, are you seeing AR take off in the enterprise, and do you see the rise of remote work helping to move the needle? Can’t wait to hear from you. Talk to you next time.