AR and VR should be booming. So why aren't we interested?

Lockdown rules are a golden opportunity for immersive technologies to provide better communication. The problem? AR and VR remain stubbornly stuck in the stage of early adoption.

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The COVID-19 virus is forcing entire populations to stay confined at home, forcing them to find new ways to work and socialize. Seen through the eyes (or rather, lens) of companies that produce headsets and software designed to allow users to be transported to someplace else, for augmented reality (AR) and virtual reality (VR) companies the social distancing required by the coronavirus sounds more like an opportunity to show what they can do to help, than a looming threat to their businesses.

Certainly, many players in the mixed reality space are already jumping in to offer their services. In the UK, software company PTC is using Microsoft's HoloLens to offer training content in factories, so that producers can fast-track the learning process to build ventilators for the NHS. PTC's program, called Vuforia Expert Capture, lets experts record a task as they carry it out through a wearable device, before turning said task into a step-by-step video with voice instructions for other workers to copy via an AR headset. 

After training 14,000 health workers in the US, AR/VR startup Virti is launching programs for 15,000 NHS nurses and doctors to help them cope with the increase in coronavirus cases. The platform transports users into high-pressure environments to improve their performance in anxiety-inducing settings. 

SEE: Executive's guide to the business value of VR and AR (free ebook)

Vivida, a VR storytelling company, is designing interactive scenarios to help companies develop cybersecurity awareness and education among their employees, as organizations turn to remote-working tools. Still in the enterprise, meetingRoom lets staff come together in virtual facilities to enhance collaboration as workers remain stuck in their homes.

And the entertainment industry too has been quick to resort to virtual tools as cinemas, theaters and art galleries were forced to shut. Last month, Art Basel virtually launched online viewing rooms to replace the opening of Art Basel Hong Kong, where more than 2,000 works were planned to be shown. The initiative was so popular that the site crashed on the first day.

But, despite these innovations, not all is rosy in the world of AR and VR. After raising $2.6 billion from some of the biggest big tech compannies, one of the most high-profile AR players, Magic Leap, was forced to lay off as many as 1,000 employees – half the total workforce.

Magic Leap certainly had ambition, aiming to be a hardware, software, operating-system owner, content provider and single, closed-wall ecosystem at once. If even the most well-funded are having to cut jobs, what does that say about the broader AR and VR industry?

"It's too early to tell the impact the pandemic will have on the AR/VR/XR industry," Botond Bognar, co-founder of 3D-mapping company REscan, told ZDNet. "The loss of MagicLeap is a loss for the entire XR community, and we all wanted to see them succeed and deliver on their original promises. But it's clear that we will see more growth in the coming months."

For Gartner's principal analyst Tuong Nguyen, the pandemic has certainly brought the importance of immersive technologies like AR and VR to the forefront. "There is an uptake in adoption, and it is a direct reflection of the environment we're in today," he told ZDNet. "People are now interested."

That is not to say, however, that hasty conclusions can be drawn. "It is a defining moment – but that's also because the market is so small that any uptick is very good," continued Nguyen.

AR and VR have been afflicted by the small size of their respective markets for a long time now. Last year, the global shipments of VR headsets totaled 5.7 million, which compares pretty poorly to the over 1.3 billion smartphones shipped in the same amount of time. 

The issue, however, isn't only that people aren't interested in buying headsets: overall, AR and VR platforms are also still lacking in maturity, and are far from being ready for the mass-market. And even if demand grows because of a global health crisis, these are issues that won't get resolved overnight.

Nguyen takes the example of his three-year-old daughter, who a couple of days ago met with her friends via Zoom – an ease-of-use that is unparalleled in AR and VR. And even on the other end of the "potential buyer" spectrum, for example, among large organizations, a jump straight to VR working is unlikely. 

"I like to use the example of my Mum," said Nguyen. "Even if I buy her a head-mounted display (HMD), how likely is it that she will use it? What are the practical applications of an HMD, how easy is it for her to put it on herself and make sure she doesn't trip and fall? And on top of that, once it's on, what will she use it for?"

Talk to her grandchildren? FaceTime already does that, Nguyen points out. His Mum, in fact, has a smartphone, which she uses to make phone calls, message, read articles and so on. A VR platform would hardly add any value to her. The applications of HMDs, argued Nguyen, are simply still too niche. 

SEE: Facebook: We're making Oculus Quest VR headset easier to use

And convincing an older relative to invest $400 into a shiny piece of single-purpose technology that they will probably be using, at best, for 20 minutes every day, is often no easy job.

Two years ago, the exact same reasons caused Nguyen to predict that AR and VR wouldn't take off for another five to ten years. At that time, the analyst forecast that use-specific HMDs would come as "band-aid solutions" that would service limited purposes in the context of "niche circumstances". 

"It's still a band-aid solution now, and it's still for niche applications, because the content isn't there yet," said Nguyen, maintaining that his forecast still stands. "The pandemic has risen the profile of AR and VR, for sure. But it's not going to come all at once today, or tomorrow, or even within the next year."

Richard Vincent, the CEO of mixed reality company FundamentalVR, does not entirely agree. It won't be a whole decade before the technology reaches maturity, he argued; and according to him, the COVID-19 crisis will accelerate the adoption of AR and VR "quite dramatically".

FundamentalVR offers a platform that surgeons can use at home with a basic HMD, to perform certain surgical procedures in VR, repeat important gestures, and get detailed feedback on surgical gaze, respect for tissue or efficiency of movement. With medical students now unable to attend university, the company is hoping to provide an alternative to practical training.

To better tailor the platform to current needs, Vincent and his team have been expanding the platform to enable multi-user access, on the backbone of the infrastructure behind games like Fortnite. The idea is to recreate a classroom environment, where users can discuss a given case, share knowledge and build up skills.

Vincent is adamant that from a technical perspective, FundamentalVR is pretty much on-point: users only have to press a button, open the app, and that's it – they're in. The problem, as ever, is adoption. CIOs in NHS trusts are still reluctant to give AR and VR any attention; an "inertia" in the face of technology that the company's CEO believes now comes at a cost.

"Had it known coronavirus was coming," Vincent told ZDNet, "I think the world would have invested in a lot more VR headsets than currently are on the market. People are now wishing they'd invested in those platforms. I believe this will change the rate of adoption of AR and VR – looking ahead, in the next 12 months, digital training will be more important than ever."

Enterprise-specific use cases, and not mass-market maturity, might be a more realistic next step for AR and VR – and business applications of immersive technologies seem to be what the coronavirus pandemic has accelerated, rather than mainstream entertainment. Case in point: Magic Leap's CEO Rony Abovitz, in his latest announcement, specified that the company's products will now be looking at answering enterprise needs. Until the market is ready, Magic Leap is therefore going to have to invest into less glamorous, but more secure, business-oriented strategic partnerships.

SEE: There are still reasons to be excited about AR and VR

REscan's Bognar argued that Magic Leap's new focus was a necessary evil. "Magic Leap's choice to focus on enterprise first and possibly go back to the consumer later is logical," he said. "Enterprise use cases and users are more forgiving when it comes to price and learning curve.

"When it comes to customer adoption, it's the complete opposite. The tech must work immediately and be fun to use, otherwise it will not be accepted," he continued.

According to Bognar, maturity is achieved when 100 million users have integrated the technology into their everyday lives. AR and VR, therefore, don't make the cut – and it's unlikely that they will anytime soon. 

Granted, the coronavirus crisis may have sped up the timeline for immersive technologies, especially in the enterprise space; but the ecosystem of AR and VR remains too immature to be adopted at scale.