Virtual reality (VR) has been at the forefront of conversations surrounding tech for the past couple of years, with exciting developments meaning consumers can immerse themselves in a computer-generated, lifelike environment. Now, conversation has turned to its investment worth.
News site ValueWalk reports that recent research from Bank of America Merrill Lynch (BoAML) suggests that VR, augmented reality (AR) and mixed reality (MR) based investments paid off with a 44.57% return in 2017. This follows a consistent performance of upwards of 32% return per year since 2014.
According to Statista, a portal for market data, VR users have grown from 200,000 in 2014 to 171 million in 2018
ValueWalk suggests that user numbers for these technologies could grow to 250–300 million users in the next few years.
It says the rise of VR is transforming experiences and communication, spanning across different sectors of life and business such as education, healthcare and financial services, and each of these industries is isolated enough to give significant returns.
These technologies could provide a bridge for the gap between the physical and the digital world, tapping into the wide potential to act as an interface, working within the Internet of Things. The author also points to the BoAML’s 13 key theme investments, with VR being the front runner, investing $2bn in the past 12 months.
AR embedding into business practices
“Augmented reality and machine learning will be embedded into business practices” this year, reports Chris Pash in Business Insider Australia
, citing Deloitte’s 2018 Technology, Media and Telecommunications Predictions.
Pash quotes Kimberly Chang, Deloitte Australia’s head of technology, media and telecommunications: “In 2018 we will finally see business challenges being addressed by what has to date been consumer driven technology. But it will be a year of trial and error.”
She is quoted as saying that the Australian companies that set themselves up for success in 2018 are those that identify ways of using AR technology “to respond to specific business challenges and attract the right talent”.
Pash highlights other predictions from Deloitte’s report, including the prediction that “a billion smartphone users will create augmented reality content in 2018”.
Business Insider Australia article
Is AR a bigger market opportunity than VR?
For a while, VR arguably held the spotlight in this realm of technology, with consumers gifting VR headsets and enjoying the immersive panoramic imagery.
However, the “diver’s mask-like” aesthetic could do with some work, writes Chris Horn for The Irish Times
. He adds: “the iPhone revolution made mobile phones a fashion item. We need a new Steve Jobs to do so for headsets.”
Horn suggests that “AR is a larger market opportunity than VR” because of its interaction with the real world – especially useful for training doctors and for architects to show clients 3D models of their designs.
Other everyday uses for AR include viewing potential furniture purchases in situ in your home or browsing paint schemes, or trying on a new outfit.
Also, AR does not require a headset. Smartphones can display augmented reality, an example being the Pokémon Go game, where adults and children battle and race to find characters.
Although investing in VR and AR carries a risk of the relatively unknown, it’s undeniably a technology sector that is growing. But is Horn right? Could AR be the more profitable investment?
The Irish Times article
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