Virtual reality (VR) immerses you in a fictional, isolated universe. Augmented reality (AR), in contrast, overlays computer-generated information on the real world in real time. As you look at or wear a device equipped with AR software and a camera—be it a smartphone, a tablet, a headset or smart glasses—the program analyzes the incoming video stream, downloads extensive information about the scene and superposes on it relevant data, images or animations, often in 3-D.
Two examples: the display that helps your car to back up safely and the popular game Pokémon GO. A multitude of consumer apps—including ones that translate street sign for foreign visitors, enable students to dissect virtual frogs and allow shoppers to see how a chair will look in their living room before they bring it home—also feature AR. In the future, the technology will enable museumgoers to conjure up guides resembling holograms; surgeons to visualize tissues underneath a patient’s skin in 3-D; architects and designers to collaborate on their creations in novel ways; drone operators to control their remote robots with enhanced imagery; and novices to speedily learn new tasks in areas ranging from medicine to factory maintenance.
Easy-to-use software for designing apps should expand consumer offerings in the coming years. At the moment, though, AR is having its greatest impact in industry, where it is an integral component of the “Fourth Industrial Revolution,” or “Industry 4.0”: the systemic transformation of manufacturing through the integration of physical and digital systems to improve quality, lower costs and increase efficiency. Many companies, for instance, are testing its use on assembly lines. AR can deliver just the right information at the very moment it is needed (such as when a worker has to select one part over another)—thereby reducing errors, enhancing efficiency and improving productivity. It can also visualize stresses in equipment and create real-time images of where problems lie.
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Market analysts, such as ABI Research, IDC and Digi-Capital, believe that augmented reality is on the cusp of going mainstream. They expect the total market for AR, currently valued at about $1.5 billion, to grow to $100 billion by 2020. Major technology companies—including Apple, Google and Microsoft—are devoting large financial and human resources to both AR and VR products and applications. And venture capital is starting to roll in, with $3 billion invested in AR and VR in 2017—half of that amount in the fourth quarter alone. Harvard Business Review recently highlighted AR as a transformative technology that will affect all businesses.
Obstacles persist. At the moment, limitations of hardware and communication bandwidth pose barriers to scaling up for everyday use by consumers. For example, many existing museum and travel apps that use AR to enhance an experience have to be downloaded in advance. Even then, the quality of the graphics may not meet users’ expectations. But the field is set to grow dramatically as cheaper, faster AR-ready mobile chips become available, more versatile smart glasses come to market and bandwidth increases. Then augmented reality will join the Internet and real-time video as an unexceptional part of our everyday lives.