Augmented Reality: Entrepreneurial Opportunities and Challenges
The following post is from Sara Wu ’18, a Butler Venture Accelerator team member.
Augmented Reality Panel in Babson Boston Campus
The Blank Center recently hosted a panel discussion around the topic of augmented reality (AR). We had the honor of having Sarah Downey, who is a writer, marketer, attorney and currently a Principal at Accomplice (FKA Atlas Venture); Ruben Mancha, Assistant Professor of Information System in the Technology, Operations and Information Management division; and Ross Finman, Founder of AR Spirit and a Ph.D. Student in Electrical Engineering and Computer Science at the Massachusetts Institute of Technology, as our guest speakers. The discussion panel was hosted in our Babson Boston Campus, and much of the discussed revolved around Pokémon Go, a free-to-play, location-based augmented reality game developed by Niantic for iOS, Android, and Apple Watch devices. During the panel, our guest panelists talked about the reasons why they thought Pokémon Go became so successful, their thoughts about the market potential for AR & VR (Virtual Reality) as well as some of the rising concerns in regards to this technology.
Why has Pokémon Go been so successful? What happened in the tech aspect and cultural aspect?
Timing is key. The fact that Pokémon go was introduced at a phase where everybody has a mobile phone that fits into his/her pocket. The concept of “exploration” and “sharing” (playing with strangers on the street) has been widely spread amongst the younger generation, and has helped the company to push the game in a strategic way. It is also very interesting to see how Pokémon Go has fulfilled the fantasy for those who grew up watching the show, since they have already adopted the whole concept and logic of Pokémon, therefore making it easier get involved in the game. By using the brand of “Pokémon” and trending technology, Niantic was able to achieve great success in the market. However, it is important to mention that Pokémon Go only applies a very low tier of AR technology, its basic concept involved a compass that directs the users to go to places.
In terms of cultural impact, Niantic has attempted to push the game into Australia and New Zealand, however the testing results came out unsuccessful, mainly because these countries are very isolated, and young population in those countries were not very exposed to Pokémon in their childhood. Logically, the United States of America and many Asian countries became targets of the company because of their high exposure.
Three areas for user cases/opportunities
AR companies nowadays mainly focus on the following three areas:
- Instruction: how to build and improve AR from what it is out there. How to make less mistakes every day and thus gain margin from the technology itself.
- Visualizations: how objects look like in AR. The level of veracity and visual pleasure a company offers to the customers.
- Entertainment: How much fun and pleasure a particular AR service/app can bring to a customer.
AR is, with no doubt, slowly changing our culture. Which is why, from a business and ethical perspective, an AR product or service needs to provide value and be innovated with a purpose, in alliance with attractive returns to the investors.
The Dark Side of AR
When new technologies come out, such as Google Maps, safety is always the first important factor that comes to people’s mind. However, there are multiple layers a company can react to this, according to Professor Mancha. First of all, companies should start exposing more of the data to their management. According to recent data, 47% of the customers do not know what enterprises do with the data they collect and the purpose of such collection. Second, there should be more research and recognition on where the data comes from. For example, does the data come from the web or the physical world? Are the data reliable? How do we make sure that we, as consumers are not put into a disadvantageous place?
Also, take into consideration that there is now a subjective layer to privacy compared to ten years ago. This raises concern especially in facial recognition. If an AR program is applied, all information could be released, how do we determine if we need to know this information or not? How do we protect ourselves from a world composed of increasing exposure?
As an aspiring entrepreneur, think about potential/holes in the AR/VR market, in which the product fully engages the user while minimizing areas of concern. How can you change the game a little bit so to make people feel safer, and at the same time fully appreciate the advancement in technology? What are some other marketing ideas you could think of to attract customers to be more engaged with AR?
Although there are some technical hurdles, Augmented Reality is the new way people will interact with the world.