Why The Billions Invested In VR Could Actually Kill It

Why The Billions Invested In VR Could Actually Kill It
September 27, 2016
If you’re hoping to create a product that changes the world, the iPhone seems like an obvious model for success. And in 2016, one of the most obvious new technologies on the cusp of a world-changing breakthrough is VR and AR. But there are plenty of reasons to think that the iPhone’s example is actually hurting VR and AR. Let me explain.

VR and AR are each exciting in their own right. Just imagine being able to travel from the bottom of the Mariana Trench to the top of Mount Everest in the span of a minute, or to see the real world overlaid with filters that bend it to your will. But more than that, these technologies potentially represent new interface paradigms—and interface paradigms are what change the world. Just look at the mouse or the iPhone.
But the iPhone’s success was unheralded for a different reason. For literally hundreds of years, innovations in technology have begun with the business world. The telephone was a business gadget before it was a household item; so too was the desktop computer. The iPhone broke that mold. It was a device that was launched first with consumers—and only afterward caused a trickle-down effect known by the snooze-worthy jargon of "the consumerization of IT." But that trend was incredibly powerful. After all, it really was the iPad that inspired the CEO of GE to ask why the software that runs a jet engine wasn’t just as easy to use. That conversation happened in myriad different industries, from health care to manufacturing.

It was as if the normal laws of gravity had been turned off. Why putz around with wonky gadgets designed for industry when you could just go directly to consumers, garnering headlines and buzz? Perhaps the most famous victim of that thinking was Google Glass. Glass made sense as a surgical aid or a repairman’s futuristic how-to manual. But it never made sense as a gadget for your family—even if your family was exceptionally dorky.
In retrospect, the consumer-first strategy behind Glass seems clearly ridiculous. But the ridiculous part is that it’s happening yet again.
When you look at the $1 billion acquisition for Oculus, or a $750 million dollar investment in Magic Leap, you’re seeing bets based on the assumption that these gadgets won’t just be modestly successful when they arrive—they’ll be almost ubiquitous, as the iPhone was.
We don’t know how much Microsoft has spent on Hololens, but the very design of the gadget speaks to the expectation that it’ll be a product for the masses. It isn’t tethered to a big computer—it’s meant to be mobile. Its industrial design is also surprisingly slick and lust-worthy. But as well designed as it is, the fact that it’s not tethered means that it’s far too underpowered at present to deliver on the true promise of AR—the promise of having almost limitless data about everything within your gaze, or being able to look through the eyes of another person. Today, most AR and VR demos relegate these devices to the role of a very fancy display gadget for trade fairs, or a novel gaming device for very, very simple games.
"The investments in Oculus and others have been so big that these startups feel like they have to go first to consumers," says Jake Barton, founder of the design firm Local Projects. "But I’ve seen startups make this mistake when they don’t find a niche first. Google Glass was a brilliant niche product, kiboshed because they tried to go big first." VR also has its own version of this problem: creating a breakthrough piece of content that displays what VR should be is so expensive that early adopters simply can’t subsidize it. "With VR, there’s a lot of interest from the Hollywood players but the challenge is that until there’s enough eyeballs there's not enough money to warrant making the Avatar of VR," says Rob Girling, cofounder of the design firm Artefact, which is currently creating story editing tools for VR.
Of course, companies can invest their money however they choose—who cares if they lose billions of dollars on a pipe dream? But when Facebook, Google, and Microsoft all make the same bet that VR and AR will be consumer products in just a few years time, that bias becomes infectious. Investors start herding toward the same picture of success. Other startups begin remaking themselves in the same mold. An ideological monoculture takes over, and the also-rans—who dreamt of a much dorkier future for VR and AR—find it that much harder to survive.

Make no mistake, as cool as VR and its cousin AR might be, their most mind-expanding applications are inherently niche, inescapably wonky, and necessarily industry focused. But they are no less amazing. Imagine, for example, being a surgeon tasked with a tricky or unfamiliar procedure, and being able to don a headset that allows one of the best surgeons in the world to see through your eyes and guide you through each step. Or imagine being a mechanic, who’s now able to fix all kinds of machines that you’ve got no experience with—simply because you can easily tap into the experiences of others.
Both AR and VR suggest a world in which experts can lend their experience to anyone, anywhere they are—and that’s a world in which expertise is far more scalable than it has ever been before in history. We shouldn't get too carried away, but the last great technology that made expertise instantly accessible was the freaking internet. "To me, where things get interesting is in the next generation of hospital monitor or flight simulator or factory manual," agrees Nick de la Mer, cofounder of the design firm Big Tomorrow. But we don’t hear about these things, because they’re far harder to imagine as billion-dollar products that will appear in millions of hands almost overnight, as the iPhone did. They don’t earn TechCrunch headlines.
Outstanding use cases for VR and AR are inherently easier to find in the humdrum reality of the working world, simply because the working world is so complex that there are many more problems to solve. You can find an analog to this dynamic in your own home. Think about how many hundreds of tools companies try to sell you, to do everything from coring an avocado to peeling an apple. All those tools exist because there are so many specialized problems that you deal with in the kitchen. But in the living room? The problems of consuming more media are so broad and already so well solved that it’s incredibly hard to get us to buy a device that promises to be just a little bit better.

VR and AR are faced with the same challenge. How good would they have to be, to be better than a TV or a phone at entertaining us? Pretty damn good, and very cheap. When it comes to VR and AR, the products that Sony and Oculus and the rest are all trying to sell us are going to be slow, halting, and straight-up disappointing—in large part because those companies won’t have had the benefit of hundreds of businesses investing in products that would never have a chance to be used at home—and then refining those limitations until they’re extinct.
By focusing on the consumer market, the tech giants investing in VR and AR are hobbling the ultimate potential of those technologies. By rushing to make them cheap and easy to use, they’re skipping over what those technologies could be if they were insanely expensive and horrible to operate. They’re trying to make them easy to use before we've even figured out why we'd want to use them at all. Once again, we need the working world to help that transition happen. And beyond being bad investments, rushing these technologies on to the consumer market too soon for there to be amazing applications runs the risk that consumers will become disenchanted—and harder to win over once the technology is finally ready for prime time.
There may never be another product like the iPhone, which changes the world in the span of just a few months. Moreover, there may never be another time that a big company can work on a world-changing gadget in secret and pull it off almost perfectly, while no one else was expecting it.
That’s fine. We all want to see the future. But it only ever arrives one day at a time, and the most exciting things typically happen at moments when no one cares to look.

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