The overwhelming theme of the keynote addresses at Facebook’s F8 Developer Conference held April 18 to 19 was augmented reality (AR). Facebook wants developers and users to hop on board the AR train today via smartphones, but Facebook’s 10-year roadmap portrays a world where we all wear AR glasses as our full-time, intuitive assistant and our primary computer interface. Facebook does admit that this vision is ambitious and one that will require new technology to achieve.
Technology stumbles when it is promoted for technology’s sake or when companies build an answer and then look for a problem to solve. A few familiar examples of such stumbles include mobile wallets, satellite phones/networks, and three-dimensional (3D) TVs. Technology does succeed, however, when the reverse principle is used: find a problem or need that a new technology can address. Facebook should keep this in mind as it looks to push AR market adoption, although Facebook’s near-term AR strategy may be lacking strong use cases.
Will Smartphones Be the Next Augmented Reality Platform?
Mark Zuckerberg launched F8 by describing the beta release of the Camera Effects Platform, which “turns smartphone cameras into the first AR platform,” according to the Facebook developer blog. The post goes on to describe the new AR tool. “AR Studio enables artists and developers to build their own AR experiences such as animated frames, masks, and interactive effects that respond to motion, interactions during Live broadcasts, or third-party data. Approved effects made with AR Studio will be available in the new Facebook camera for use with photos, videos or Live broadcasts.”
Beta partner Giphy created Giphy Live, which allows viewers to let video posters know which topic they are most interested in via hashtags. According to the post, “The most frequently commented hashtags will show up in a ticker across the top of the video. The broadcaster can then select one of those hashtags to cause a GIF related to that topic to pop up on screen, creating a whole new form of interaction between broadcaster and viewer.”
Zuckerberg and other keynote speakers further touted other near-term AR possibilities for Facebook developers, such as virtual sticky notes that friends or marketers could leave for others in certain locations and creating public AR art or interactive social games.
While AR stickers and effects make sense as a use case and have been successfully monetized by Snapchat’s Sponsored Lenses, which Tractica estimates generated $35 million in revenue in 2016, how appealing are some of these other ideas? Location-based virtual sticky notes are essentially the original AR browser consumer use case that launched in 2008 and has since crashed and burned. Setting aside the phenomenon of Pokémon Go, the idea that people would continuously hold up their phones to view the world, even for the chance to see public art, is a bad one. Social game development is a high-stakes, fickle business where the odds of success are similar to those of winning the lottery. Will savvy game developers go all in for an AR game just available on Facebook’s platforms (FB, Instagram, Messenger)?
Perhaps Facebook is just thinking out loud in an attempt to get the ball rolling. Meanwhile, it may be more interested in seeing the range of compelling use cases for AR that creative third-party developers will come up with on their own.
Mobile Augmented Reality Use Cases with the Greatest Potential
Tractica’s recently published Mobile Augmented Reality report focuses on the use cases that hold the greatest potential over the next 5 years for both the consumer and enterprise markets. Below is a brief overview of the consumer use cases:
- Social Media: With its focus on sharing user-generated content, AR has the potential to have a significant impact through social media. AR stickers and effects will be the workhorse, but social media platforms like Facebook and others, such as Tencent’s WeChat, will deploy AR application programming interfaces (APIs) to cultivate games, maps, and e-commerce use cases, and all will be monetized within social media platforms’ advertising structures.
- Gaming and Entertainment: The compelling attraction for AR games is interaction that is specific to time and place, which takes advantage of the unique sophisticated sensors of smartphones. A great example is the new Father.io game.
- Mapping and Indoor Navigation: One of the shortfalls of many current mapping applications is that they rely on the smartphone’s global positioning system (GPS) functionality, which does not work well for indoor navigation. The addition of AR capabilities using 3D sensors and cameras solves this issue. This extended mapping capability is coveted by players for which mapping as a business makes sense, namely Apple, Google, Baidu, and perhaps Bing and Facebook. Indoor navigation opens opportunities for venue owners, including retail shops, convention centers, hotels, airports, and office buildings. In retail, AR may succeed in delivering aisle-by-aisle directions to products and additional product information, such as ingredients, ratings, specifications, and user guides where beacons have failed.
- Visual Search: The consumer use case for mobile AR with the potential to reach the largest audience and generate the most revenue is visual search, which is the ability to instantly access data associated with anything a user sees. Tractica believes several internet giants will launch visual search functionality by early 2018, including Baidu, Alibaba (with Shenma), Tencent (with Sogou), Google, Microsoft/Bing, and Facebook. Search remains one of the largest digital advertising vehicles. All of these companies have a massive stake in search and are among the world’s leaders in artificial intelligence (AI)/deep learning.
- Toys: Toy manufacturers are experimenting with incorporating AR into physical toys and games with the notion of adding value and stickiness for consumers who are increasingly interested in digital play. If the physical toy is flexible enough in play options, toymakers can continue to sell software upgrades to toy purchasers.
- E-Commerce: Being able to visualize how a product will realistically look in its surroundings before buying is a hugely important benefit that AR can deliver. A number of companies now offer solutions allowing customers to virtually try on clothes, beauty products, and eyeglasses, to position furniture and other items in their homes, and to view the inside and outside of a property they are interested in purchasing without having to even visit the physical location. For retailers, this helps increase sales and, more importantly, reduces returns, which greatly impacts the bottom line. The IHL Group estimated global returns were $642 billion in 2015 (including both e-commerce and physical store returns). AR product visualizations can reassure consumers that the product they are purchasing is the right one, reducing indecision, hassle, and stress.
Social Media Platforms and Visual Search Will Be Key Drivers
In Tractica’s view, Facebook can be a significant engine pushing AR adoption during the next 5 years, but it should encourage specific use cases and supply its developers with the tools to succeed with those use cases for smartphones and tablets, namely:
- User-generated stickers and filters
- Mapping/indoor navigation
Other players, particularly those that develop visual search businesses for smartphones, will drive AR market adoption even more so than social media platforms. It will be interesting to see in 10 years how much closer we are to the AR glasses/intuitive assistants envisioned by Facebook. The smart money is on AR glasses, but only if the glasses support some pretty compelling use cases.