AR – Productivity pays

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AR is alive and well in the enterprise.

• Amongst a surprising re-launch of Google Glass and a major pivot by Meta, it is increasingly clear that while augmented reality (AR) makes sense in the enterprise, it is years away from the consumer market.
• Google has quietly relaunched Google Glass as a smaller unit with upgraded electronics that can attach to a range of regular glasses frames as well as safety eye wear.
• This time around the focus is 100% on productivity as it has been developed with input from companies and is called Glass Enterprise Edition.
• The use case being targeted is employees that need to fulfil complicated manual tasks where the device provides instructions obviating the need for assembly instructions.
• The device is being sold through partners that are offering software customisation on top of the base unit in order to provide the functionally needed by various industry verticals.
• This is exactly what Atheer Labs moved into some years ago, although its unit also provides communication and is somewhat larger.
• At the same time Meta, an AR start-up, has also pivoted into the enterprise after realising that it was going to struggle with selling devices to consumers.
• Meta is now on a major publicity drive with a proposition about how its device can be used to replace office monitors.
• Interestingly it seems to have abandoned collaboration and communication which is an important part of the workplace and was something it was demonstrating for consumers some years ago.
• These moves echo how the message from other players like Microsoft and OTG has also changed over the last 12 months with silly living room-based shooting games being replaced with productivity applications.
• All this is happening because in the enterprise, it is productivity that really matters with the user experience being less important.
• I think that this happening as in consumer, the users pay money for an experience but in the enterprise users are paid to use the technology.
• Hence, enterprise users’ willingness to put up with a substandard user experience is much greater.
• The AR user experience is still miles from where it needs to be but critically it does offer productivity improvements that have led to many companies trialling it particularly for employees in the field.
• These trials are now gradually moving into real world deployment.
• Hence, I continue to believe that AR in the enterprise should see both unit shipment growth as well as good growth in revenues from software and services in 2017.
• However, I think the consumer will continue to languish and the only one that is sticking to its consumer guns is Magic Leap.
• Magic Leap has made incredibly bold promises around a consumer offering in AR, but it is questionable as to how close it really is in terms of having a working, commercial product (see here).
• From an investment perspective, AR in the enterprise is the only place I would entertain putting money into this year unless it is something aimed at fixing the limitations that keep AR and VR uninteresting to the consumer.