ARBW #9 After the Fizzle: AR Following Apple’s Flop

So many had expected so much of Augmented Reality at the Sept. 12 Apple news conference. But, instead of ushering in a new era, the company inexplicably spent more time showing inane emoticons than the ARKit game-changing consumer and business apps that had been implicitly promised and promoted. Instead of the star of the show being some awe-inspiring 3D product showcasing app, the company spotlighted–to the embarrassment of many Apple champions–an emoji pile of poop with a smile and cutesy eyes.

This news conference was for me a personal nadir as both an Apple Fanboy and as a believer in immersive technologies as a formidable transformative force. Not only that, I was hoping that Tim Cook would finally be able to demonstrate he could deliver great technologies and step out from under the shadow of his predecessor and mentor.

It was not to happen.

There were a few gems that show promise. I really liked Ikea Place, which allows shoppers to see what a couch will look like in their living rooms before actually buying. As an amateur star gazer, I have had fun seeing astral constellations through my iPhone with Sky Guide.

Burberry, an elite apparel brand started in 1917, created an ARKit app that celebrated its centennial anniversary by going retro. You can use the app to look at a current magazine Burberry ad. When you look through the phone a very similar ad from 1917 appears. It is cool and innovative in my view. I would predict that other brands will use iPhones and Androids to use AR for similar forms of advertising in the near-term future.

Other apps showed promise, but left me scratching my head in regard to utility. For example, Actum Labs showed an old, toy-sized virtual forklift appearing on an industrial floor. Then it grew to full size as workers walked by. This seemed cool up to that point, but then, nothing else happened. The virtual equipment lifted nothing, it just wandered around the factory floor for a while.

Apple & Crap

Despite these exceptions, most observers agreed that the turd emoji was a fair summary of the ARKit offerings: a pile of crap.

We tested 170 ARKit Apps and found only 70 to be worth using at all, and very few of those were applicable to business. In reading Facebook reviews of ARKit apps, I was reminded of the famous Jobs quote from when he was launching the iPhone: “Everything else is just crap.” Except this time we were talking about iPhone content, not competitors and most of it is indeed quite crappy.

This brought me to rethink what I had thought when earlier this year Apple declared its intentions and launched the promising ARKit. Developers published thousands of sample demos of what could be via social media with fan flames of excitement before the actual apps could be reviewed to the great disappointment of the growing AR community.

When we published our book, we had given smartphones very little thought. We saw fulfillment of the promise of immersive technologies in headsets, not handsets. It requires headsets for users to experience the necessary immersion of the new technologies. Headsets also allow users to operate hands-free. This is essential to many enterprise applications. We envision interfaces that will soon be driven by voice, eye interaction and brainwaves, technologies that already exist, but require considerable refinement before they are ready for everyday people.

That refinement has been taking more time than we had originally thought. Headsets, as we write, remain expensive, limited in use, geeky, uncomfortable and limited in freedom of motion and vision. That was already on our minds when Apple first announced ARKit, followed by Google’s announcement of ARCore for Android phones.  I saw AR on handsets as a great evolutionary step. If AR headsets were not ready for everyday people, then AR would go to where the people were and this is the handset.

We saw this as only a step towards the Fourth Transformation, when headsets will replace handsets altogether because handheld devices have the inherent limitations to AR mentioned above, plus others. Holding a phone in front of you for a couple of minutes to spot a Pokemon might be fine, but it would be cumbersome to do real work for very long while holding a phone up as a viewing device.

I started to regard AR phones as transitional devices on the road to AR headsets—sort of like the mini computers of the 1970s, when the DEC Vax and similar computers filled a gap between the powerful and expensive mainframes of big corporations that were limited in who could use them and the new PC that were still just the toys of geeks and hobbyists.

But mainframes got smaller and less expensive, and PCs, of course, became tools of everyday people, particularly after the Macintosh came out in 1984. Today, the role of minicomputers is pretty much forgotten. I see the role of the smartphone in a similar way, only in a grander scale.

Today everyone uses it. Sometime between five and ten years from today, it will be the tool of elderly people who opted not to adapt new ways just like the elderly of yore stuck to their horse-drawn buggies when the car came out. Despite my deep disappointment in what Apple has delivered, I believe that phones will get millions and millions of people to experience immersive technology for the first time on devices that are already part of their lives. They will then understand its myriad benefits and realize how much better it could be on headsets.

Tim Bajarin, president of Creative Strategies, Inc., one of the oldest market research firms in Silicon Valley, is far closer to the inside of Apple’s senior team than I am. Much of what he knows is under NDA, but he did tell me that the reason for the paucity of quality business AR apps was that they just weren’t ready to show when the conference was held. He told me that many astounding new ARKit apps will appear early in 2018. “The apps I have seen are targeted at both enterprise or business as well as consumers. Although some of the most interesting and groundbreaking are being designed for vertical markets.” I hope that Bajarin is correct, I truly do. I hope also that similar apps come out on ARCore for Android. This will vastly enhance business and consumers embracing the next transformation technology.

But at the end of the day, handset AR will be merely a transitional step into the Fourth Transformation lasting five years or less. It is not just the underwhelming quality of the ARKit launch. It is that the places where AR Phone apps may take hold are precisely places where people will soon realize that headsets will offer a superior experience.

I hope Bajarin is right. We will soon see. But in the big picture of this transformation, all that has occurred is a hiccup in the continuum. AR is still coming. The richest, most powerful and talented companies are all investing vast fortunes in an AR future. Apple had a chance to pre-empt the AR handset market and it failed to do so. It is not out of the game by any means and we are still in the early stages of a game unfolding into a large and complex competitive battle.

In the book, we said it would take ten years before AR headsets would replace handsets as the center of digital life. We will stick with that estimate. We continue to see evidence that it will unfold in half that time for early adopters and commercial thought leaders.

Since the abyss of Sept. 12, I continue to see significant AR inroads in places that build consumer demand. Take sports for example.

AR in Pro Sports

AR is already changing how fans experience college and professional sports. Last week, the San Francisco Giants previewed to a gaggle of reporters how “At Bat,” an Apple app will become a superior AR app sometime next year for all Major League baseball teams. You can bet that the NBA, NFL, pro soccer and rugby will soon follow suit with similar phone-based AR apps.

Once fans start using them, they will soon start understanding the limitations of watching live sports while holding a phone or tablet a few inches in front of their faces. It is uncomfortable, awkward and limits the fan’s ability to consume hot dogs and adult beverages. The success of such apps will create the demand for headsets that provide more immersive hands free experiences.

In fact in the few short weeks since Apple laid its virtual egg before a global audience of disappointed fans, the hangover of despair I felt following the iPhone launch has been steadily returning to optimism as announcements about small, but significant improvements to AR and VR headsets have come out The only sour news in that area has come from none other than Tim Cook.

Evolution of AR Headsets

I cannot emphasize enough that in most situations, smartphone AR will be merely transitional technology on the road to fashionable, affordable, untethered handsets that everyday people will wear as they go about their lives–just like they do with smartphones today. Since, the unfortunate news conference, Cook appeared prominently in AR news only one more time. Last week, he declared he didn’t think the technology yet existed for quality AR headsets. This may be true, and Apple may be the first to offer great headsets someday, but in the last couple of weeks, we have seen multiple announcements showing steady headset improvement.

Microsoft, revealed that its Windows Holographic platform has a whole lot happening in hardware making. Partners Acer, Dell, HP, Lenovo and Samsung all announced headsets starting for $299. The new headsets all have significantly improved design and are lighter weight than existing headsets. For example, Lenovo says its device will be about 40 percent lighter than the HTC Vive.

But issues remain. Technologists are unhappy that Microsoft marketing has decided to hijack the generic term Mixed Reality (MR) and are using it to brand these headsets, which are less than the term implies. Historically Mixed Reality is a generic term used to describe VR that is integrated with reality so tightly that you cannot discern the difference.

Windows Holographic devices are really just tethered VR headsets with viewing flaps. I don’t like it, but I suspect that resistance is futile and I am using the MR term less and both the AR and immersive technology terms more. Overall, I am glad to see Microsoft continuing efforts to be among the driving forces of immersive technology. With its unmatched position in the enterprise it is destined to play a leadership role in the enterprise of the near tomorrow. Despite limitations that the company admits, Hololens is becoming the leading high end enterprise AR device.

A $200 Oculus VR Headset

On the consumer side, Facebook took a significant step out of the evolutionary swamp last week in announcing a $200 Oculus Go VR headset that requires neither a PC nor smartphone to operate. Facebook CEO Mark Zuckerberg pitched the new headset as the “sweet spot” between the company’s $400 Rift headset and the mobile phone-powered Gear VR headset that Facebook sells in partnership with Samsung.

Personally, I think Go will eventually replace both the Gear and the Rift. It will suck coveted younger shoppers away from both the iPhone and Android AR platforms. At that price, it will also hijack a godly number of AR phone apps, particularly among younger shoppers.

Zuck positioned it as a gamer product, but in the long run, it can be a lot more than that. Zuck keeps saying that Facebook expects to have a billion AR/VR users. The Go may be a big step out of the evolutionary swamp in that direction and that means we should expect shopper apps in the near-term future.


Microsoft is also about to be a player in this same social VR space. Last week it announced acquisition of AltSpaceVR, where I conducted a very enjoyable global news conference during our book launch. During the news conference announcing the deal, Alex Kipman, one of the Hololens research gurus, predicted that communications would ultimately be VR’s killer app. I tend to agree. My one experience in it, opened my eyes to an unfulfilled promise that Facebook Spaces and High Fidelity have taken further. Now, with Microsoft’s wherewithal behind the AltSpace pioneering team, there may be accelerated innovation between such powerful players as Facebook and Microsoft.

There are also a few attempts to create AR conferences as well where people actually see each other as people. The most prominent player in this category is Zoom, which has gained both traction and fans. Personally, I look forward to a near-term future to conducting global business meetings, presentations, online learning classes and plain old conference calls in social while reducing carbon footprints, travel time and costs. Social VR, like employee training and a surprising number of medical applications all portend a future for VR that goes well beyond the capabilities of the phones of today or tomorrow.

There are also more rumors that the investment sponge known as Magic Leap will be delivering a headset to market soon, but I harbor personal doubts that will happen anytime sooner than the arrival of Godot.

AI Capability Beyond the Phone

Another  limitation to the phone’s capabilities is Artificial Intelligence. While AI may help you get the right answers when you ask Google-and someday Siri– a question, headsets will eventually get more up close and personal. AR/VR headsets will see what the user is looking at and will understand personal patterns better than the user themselves do. They will be able to predict what you want before you know yourself. This may feel freaky, but it will also certainly be useful.

Additionally, we are hearing rumors that both Amazon and Google have significant headset plans for early next year. These two companies have a very important secret sauce to add to the mix. They are both far ahead of Apple and perhaps Facebook in Artificial Intelligence (AI) capabilities.

For AR headsets to achieve what  I believe they will achieve, AI needs to become far more of a factor. In order for headsets of the future to reach their full potential, they need to understand their users on a deeper, granular level. This is what we talked about in Age of Context when we wrote about devices that know us better than the people closest to us. Yes, this threatens what few remnants of privacy we still have, but the trade-off is that AR and AI will make our lives safer, healthier, easier, more interesting, more empathetic and more aware.


Missed Our Live online Class? Here’s a Chance to See The Video of it for Just $57

On Oct. 2,  I presented AR and the Future of Work, our first in a series of live online classes. It was well received. Our overall rating from the 118 students attending was 4.4 stars out of a possible 5.

It was a survey course, showing many use cases on how both enterprise and consumer-facing businesses are beginning to use immersive technologies. The live course cost $247 to attend. We are now selling the video of it for $77. If you are an ARBW subscriber you can get $20 off that price by going to the link included in your email copy of ARBW #9

If you are not a subscriber yet, you can subscribe for free here. Once you have confirmation, please contact to get your link for the $57 sales page.


Elsewhere in the AR World

Following the Thought Leaders

When Budweiser learned in the 1950s how to sell more beer on TV, it became the best seller. It was followed by other surviving brewers who tried hard, but did not catch up with beer’s first mover throughout the Golden Age of TV. This first mover advantage remains intact more than 50 years later.

There are thought leaders and there are risk-adverse pack followers. Once the leader establishes position, they very often maintain it for long periods of time, perhaps until technology, rather than competitors disrupt them. That is what has happened already in the suddenly hot category of home furniture sales.

Ikea was the brick-and-mortar category leader. It moved aggressively to using AR online in the early pioneering days of 2014. Ikea Place, mentioned above, is the third iteration and it is clearly making money from it.

Now comes the pack. Three existing competitors: Wayfair, Target and Lowe’s have each announced that they will be introducing AR phone apps in the future. I am betting each will be almost as good as what Ikea has today and chances are that Ikea will have moved on to something new and better.

My point is that sometimes it is a smart move to weigh the risks and take them. You cannot be a category thought leader without doing that at critical moments when technologies start to change your relationships with customers.

Even then, it does not mean you will be in the clear. Last week, Engadget reported that Amazon, fresh from its entry into the grocery business where it will face off against Walmart, is considering opening furniture and electronics stores where AR will play important roles.

The Fall of Toys R Us

In late September, I posted about Toys R Us going bankrupt on Facebook. By odd coincidence, my friend Scott Monty  posted a nostalgic clip from Sesame Street. It seems to me only yesterday Toys R Us was the ultimate destination for parents when shopping with kids, Sesame Street was the go-to TV program for kids that parents endorsed, and TV was the ultimate form of global media. Times change, so does culture. Tech plays a big role in shaping both media and culture as well as where and what kids want for play and entertainment.

In The Fourth Transformation, I identified a new generation of kids that we named Minecrafters because the game created a culture of sharing, the ability to code before attending Kindergarten, and most important, the ability to solve problems by thinking in 3D, making it relevant to the inevitable dominance of immersive technologies.

Since the book, we have identified a younger generation still. They are the kids, born after the smartphone became more popular than the commercial TV. They have the ability to pick up headsets, put them on and start actually doing things without instructions from an adult.

If you are a brand or a merchant, you should think about this. How do you give kids of today, the quality of experience that Sesame Street once provided and that earlier Toys R Us stores offered? How do you beat Amazon, Walmart and Target with customers when you can’t beat them on price?

Give them remarkable experiences. And that directs you right into AR and VR. This is why I encourage clients to strive to use technology to establish thought leadership. Without that you may be destined to be locked into the pack—at best.

One thought on “ARBW #9 After the Fizzle: AR Following Apple’s Flop

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