Complexity of the ARMR Market: Devices and Hardware

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By Eric Abbruzzese | 2Q 2017 | IN-4530

The augmented and mixed reality ecosystems continue to grow, both in scale and complexity. This Insight looks at the layout of hardware and devices in augmented reality (AR) and mixed reality (MR), with a complementary Insight covering the software and platform market.

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A Segmented Continuum


A continuum was introduced in the 1990s to define what were once futuristic devices, delivering reality-enhancing and reality-replacing experiences. Currently, the continuum is more segmented than contiguous, with majority of devices falling within a handful of categories:

  • Augmented Reality (AR): 2D or 3D visuals, with no environmental awareness/interaction, and a pass-through display or live camera feed.
  • Mixed Reality (MR): 3D visuals with environmental awareness/interaction, and a pass-through display or live camera feed.
  • Merged Reality: 3D visuals with environmental awareness/interaction and/or fully-rendered environment. User vision is obfuscated with screen/housing, but camera pass-through can “merge” VR with environment.
  • Virtual Reality (VR): 3D visuals in a fully-rendered environment. User vision is obfuscated with screen/housing.

Other terms are sometimes used, and the definitions of these terms often overlap with existing terminology that make new terms redundant. An example of this is augmented virtuality, as it is used to describe the placement of real-world objects in a virtual environment.

Upcoming smartphone releases have the potential to draw additional attention to the “X” reality markets, with devices capable of both AR and VR. ABI Research will be producing dedicated research on this continuum and its segmentation to aid in understanding and defining the market.

Multiple Generations All at Once


These four categories can present enough complexity on their own, but there are also differences in form factors to consider. Mobile devices, both with existing sensor arrays and newer technologies like Google Tango, will vie for market share, notably in the consumer market, which, so far, has not experienced any significant AR uptake. Mobile devices will be competing and collaborating with head-worn devices, and these head-worn devices split between standalone and non-standalone capabilities. With such variance in hardware, it is easy to get lost among similar-sounding terminology.

Major technological differences take generations to develop and reach the market, but a unique aspect to the current AR/MR/VR markets is that devices of multiple “generations” already coexist. Devices as simple as those with a passive 2D screen (i.e., Google Glass) to something as complex as DAQRI’s smart helmet—with spatial mapping, depth sensing, thermal imaging, and more—are already available. The availability of these devices in parallel presents an interesting facet to the market, due to large variation in device capability, target use case, and price presenting difficulty.  

Coexisting Separately


The current segmentation will start to blend, and we are beginning to see the emergence of this trend with Google Tango bringing MR and merged reality potential to mobile devices. Microsoft’s merged reality push with its reference design headset program already has traction and several hardware partners, with the devices handling both VR and merged reality. Another likely path is adding full opacity to AR and/or mixed reality devices, creating an all-in-one device that spans several categories in the market.

Smartphones are perhaps the most influential piece of the puzzle. As seen in the VR market, tethers to an external device are limiting; meanwhile, lowering hardware requirements to only a smartphone opens the doors to a several billion-strong install base. Not only that, these devices are familiar and (mostly) mature: developers, OEMs, and customers are comfortable with the operating systems, components, content delivery methods, etc. Capitalizing on this has been a boon for mobile VR, and will be for mobile AR. 

Having familiar platforms to leverage is critical for nascent technologies and markets; VR experienced issues with content starvation and fragmentation, which is getting better through increased developer comfort, knowledge, and support. These factors combine with an increasing number of compelling use cases across consumer and enterprise markets; while gaming, video, and social applications will reign supreme for consumers, existing enterprise interest in mobile AR surrounding digital documentation, workflow guidance, and remote assistance will expand in both quality and scale with MR on mobile.

Realistically, we can expect notable MR support on mobile devices in 2018 into 2019. Early examples are already available; Qualcomm and Google partnered with ASUS to roll out Google Tango and Qualcomm’s Snapdragon 835 with the ASUS ZenFone AR, and showcased it at CES 2017. The heavy hitters in mobile—Apple, HTC, Huawei, LG, Samsung, Sony, etc.—will join later. Look to 1Q 2018 for early arrivals from these companies, with the CES and Mobile World Congress (MWC) combination in 1Q highlighting what the rest of 2018 could bring. This first year of notable presence will serve as a small-scale litmus test, with positive indicators allowing launches to continue as planned.

All told, numerous end-user experiences—delivered by devices with highly variable capabilities, features, and prices—introduce a barrier of complexity for hardware. There are two sides to this. On one side, there is a level of choice that is rare among new technology this early in a lifecycle. On the other, the level of familiarity needed to confidently invest in the market—whether a consumer or an enterprise buyer—is much higher than average. At the same time, the software and content sides of the market are similarly complex. Even so, the multifaceted state of the market is outweighed by the benefits: for consumers, a potential revolution akin to the smartphone, and for enterprises, a highly compelling investment with increasingly compelling ROI proof points.

For more information concerning ARMR, see a related ABI Research Insight about the software, content, and platform sides of the ARMR market.