XR for Business 2018

1. INDEPENDENT PUBLICATION BY RACONTEUR.NET #0556 29 / 11 / 2018 FUTURE OF XR PRAESENT DIMENTUM DIAM CURSUS MASSA VIVAMUS ALIQUET NUNC SIT AMET DUI EGESTAS0603 DUIS AT DAPIBUS JUSTO PRAESENT TEMPOR08 The complete XR toolkit Discover more at zap.works Powered by XR FOR BUSINESS GROUNDING TECH IN EXTENDED REALITY LEAPING OBSTACLES TO SUCCESSFUL XR0603 POWERING THE FOURTH INDUSTRIAL REVOLUTION12

2. RACONTEUR.NET 03 /xr-business-2018 G oogle Glass is going to transform the world, we were told five years ago. The $1,500 (£1,160) voice-activated, hands-free smart spectacles would be as ubiquitous and useful as smartphones. Soon people realised that the reality of Google Glass fell short of the hype. In addition, it fulfilled no use-case, was pricey, invaded pri- vacy and was downright creepy. No one batted an eyelid when Google stopped selling the purportedly rev- olutionary tech in 2015. The bombastic entrance and high-profile failure of Google Glass is important, however, as it evolved the concept of wearables and simul- taneously elevated the barrier many business leaders struggle to overcome with new technologies. Recent research shows that C-suite executives are interested in so-called extended reality (XR) technologies, namely virtual, augmented and mixed realities. Indeed, analysts at Gartner predict that by 2019 some 20 per cent of large-enterprise businesses will have adopted XR technologies. Furthermore, managing director of Accenture Technology, Maynard Williams, reveals that according to a 2018 study by his company: “Some 27 per cent of executives believe it is very important for their organisations to be a pioneer in XR solutions.” He says: “Making well-planned forays into immersive experiences now will help build the capabilities needed to transform entire industries tomorrow.” Business leaders can’t afford to punt on potential, though; they seek fully baked solutions that will make a significant improvement today. Alas, the Google Glass misstep is one of a growing number of overhyped tech products that have made corporate decision-makers, among others, war- ier about XR’s lofty promises, argues Naji El-Arifi, head of innovation at consultants Wunderman Commerce. “Overall, the community is now much more cautious of the technology due to Google Glass’s fail- ures in approach. I feel most companies learnt from that and now take things much more slowly,” says Mr El-Arifi, while stressing the potency of mature XR. “Understanding the real and digital worlds, and bringing them together seamlessly so they can share the common reality, will be the next big thing in B2B [business to business] and B2C [business to consumer]. It will also take the disrup- tor crown away from mobile.” Is the gulf between expectation and reality widening, and is that harming the long-term chance of XR technologies triumphing? Karl Maddix, co-founder and chief executive of VR software development company Masters of Pie, believes there is often still too much untruthful marketing in this space. “It is easy to make people excited with scenarios of XR revolutionising our lives in the near future, supported by captivating mock-ups and videos of perfect virtual environments, but this is often lacking substance; all flash and no Gordon,” he says. “The hype they generate does help when it comes to attracting investors and making potential end-users excited enough to initiate a conversation. But that conversation needs to be grounded in reality, with people who are on the front line and are interested in building solutions, and not just showing how visionary they are.” Jeremy Dalton, head of VR/AR at PwC, contests that the ballyhoo around XR is “partly the result of a lack of understanding of the technology”. He continues: “Ultimately, this stems from a minimal experience that is then used to build a view on all areas of the technology, leading to many misconceptions about the value of XR. “It’s the kind of technology that has to be tried before being under- stood; in many cases we see, expectations are exceeded as it’s difficult to describe in words what is ultimately a very visual and immersive experience.” Richard Das, senior manager at Deloitte Digital, agrees. “As the say- ing goes, if you judge a fish by its ability to climb a tree, you’ll be dis- appointed,” he says. “Because we bring many of our preconceptions to the table of what tech is, it’s hard to measure expectations of what it could be.” Dr Karen Correia da Silva, senior social scientist at consumer behav- iour specialists Canvas8, points out that Google Glass is succeed- ing in the B2B space. “An adapted version is thriving in US facto- ries,” she says. “At DHL, employ- ees used Glass to streamline the package-picking process, improving efficiency by 15 per cent. Google tried jumping all the way to the customer applications when the product and tech perhaps weren’t quite there. But when it shifted its focus to a place that could get value out of the technology as it was at the time, it succeeded.” The dearth of XR use-cases is a worry, though it is expected to improve before long. “Limited software or applications will always restrict demand, or kill the hype, for a technically sound product,” says Mark Bates, general manager of Hire Intelligence, a B2B rental organisation that has seen a 394 per cent increase in XR hardware inquires in the last two years. “The power and potential of XR is strong, but the loop must be closed between industry needs, hardware capability and application development. Once applications are rel- evant, senior personnel in industry will trial the tech and then word of mouth about the quality of experience will drive greater adoption.” For Rebecca Gregory-Clarke, head of immersive technology at Digital Catapult, it is clear that business leaders have to look past the hype and focus on matur- ing XR. She concludes: “For those looking to take full advantage of immersive technology, it’s important to get involved now to be well positioned to take maximum advantage once the technology has fully evolved. We’re currently in the ‘black-and-white TV’ era of XR, a nascent version of a now-ubiquitous technology.” Grounding tech in extended reality XR FOR BUSINESS @raconteur /raconteur.net @raconteur_london The significant potential of reality technologies should not be lost in past hype and disappointment STEPHENARMSTRONG Contributor to The Sunday Times, Monocle, Wallpaper* and GQ, he is also an occasional broadcaster on BBC Radio. SOPHIE CHARARA Associate editor at The AmbientandWareable, she is also a freelance writer on technology and pop culture, with bylines in Stuff,WIREDand Forbes. ANNA CODREA-RADO Freelance culture and technology journalist, her work has been published in The New York Times, The Guardian and WIRED. NICK EASEN Award-winning freelance journalist and broadcaster, he produces for BBC World News, and writeson business,economics,science, technologyandtravel. OLIVER PICKUP Award-winning journalist, he specialises in technology, business and sport, and contributes to a wide range of publications. EMMA WOOLLACOTT Specialist technology writer, she covers legal and regulatory issues, and has contributed to Forbes and the New Statesman. Distributed in OLIVER PICKUP Distributed in association with CONTRIBUTORS TimothyFadek/CorbisviaGettyImages DEVELOPMENT Publishing manager Frank Monaghan Digital content executive Fran Cassidy Head of production Justyna O'Connell Design Joanna Bird Grant Chapman Sara Gelfgren Kellie Jerrard Samuele Motta Head of design Tim Whitlock Production editor Benjamin Chiou Managing editor Peter Archer Although this publication is funded through advertising and sponsorship, all editorial is without bias and sponsored features are clearly labelled. For an upcoming schedule, partnership inquiries or feedback, please call +44 (0)20 3877 3800 or email info@raconteur.net Raconteur is a leading publisher of special-interest content and research. Its publications and articles cover a wide range of topics, including business, finance, sustainability, healthcare, lifestyle and technology. Raconteur special reports are published exclusively in The Times and The Sunday Times as well as online at raconteur.net The information contained in this publication has been obtained from sources the Proprietors believe to be correct. However, no legal liability can be accepted for any errors. No part of this publication may be reproduced without the prior consent of the Publisher. © Raconteur Media raconteur.net The original model of Google Glass failed to live up to the hype Bringing immersive technology to business info@makereal.co.uk +44 (0)845 0178 777 Why not arrange to meet and learn more? For over a decade, Make Real has been working with the enterprise sector to design, develop and deploy mission critical business applications. We don’t hype specific technologies, we evangelise the real benefits. We believe in using the right tools to meet business challenges and add value, whether it’s augmented reality, virtual reality, simulation or serious games. Top concerns about XR startups Concerns startups hear from potential investors Slow adoption 71% Lack of an established market for the technology 67% Untested technology 18% Perkins Coie 2018

3. RACONTEUR.NET 03 /xr-business-2018 G oogle Glass is going to transform the world, we were told five years ago. The $1,500 (£1,160) voice-activated, hands-free smart spectacles would be as ubiquitous and useful as smartphones. Soon people realised that the reality of Google Glass fell short of the hype. In addition, it fulfilled no use-case, was pricey, invaded pri- vacy and was downright creepy. No one batted an eyelid when Google stopped selling the purportedly rev- olutionary tech in 2015. The bombastic entrance and high-profile failure of Google Glass is important, however, as it evolved the concept of wearables and simul- taneously elevated the barrier many business leaders struggle to overcome with new technologies. Recent research shows that C-suite executives are interested in so-called extended reality (XR) technologies, namely virtual, augmented and mixed realities. Indeed, analysts at Gartner predict that by 2019 some 20 per cent of large-enterprise businesses will have adopted XR technologies. Furthermore, managing director of Accenture Technology, Maynard Williams, reveals that according to a 2018 study by his company: “Some 27 per cent of executives believe it is very important for their organisations to be a pioneer in XR solutions.” He says: “Making well-planned forays into immersive experiences now will help build the capabilities needed to transform entire industries tomorrow.” Business leaders can’t afford to punt on potential, though; they seek fully baked solutions that will make a significant improvement today. Alas, the Google Glass misstep is one of a growing number of overhyped tech products that have made corporate decision-makers, among others, war- ier about XR’s lofty promises, argues Naji El-Arifi, head of innovation at consultants Wunderman Commerce. “Overall, the community is now much more cautious of the technology due to Google Glass’s fail- ures in approach. I feel most companies learnt from that and now take things much more slowly,” says Mr El-Arifi, while stressing the potency of mature XR. “Understanding the real and digital worlds, and bringing them together seamlessly so they can share the common reality, will be the next big thing in B2B [business to business] and B2C [business to consumer]. It will also take the disrup- tor crown away from mobile.” Is the gulf between expectation and reality widening, and is that harming the long-term chance of XR technologies triumphing? Karl Maddix, co-founder and chief executive of VR software development company Masters of Pie, believes there is often still too much untruthful marketing in this space. “It is easy to make people excited with scenarios of XR revolutionising our lives in the near future, supported by captivating mock-ups and videos of perfect virtual environments, but this is often lacking substance; all flash and no Gordon,” he says. “The hype they generate does help when it comes to attracting investors and making potential end-users excited enough to initiate a conversation. But that conversation needs to be grounded in reality, with people who are on the front line and are interested in building solutions, and not just showing how visionary they are.” Jeremy Dalton, head of VR/AR at PwC, contests that the ballyhoo around XR is “partly the result of a lack of understanding of the technology”. He continues: “Ultimately, this stems from a minimal experience that is then used to build a view on all areas of the technology, leading to many misconceptions about the value of XR. “It’s the kind of technology that has to be tried before being under- stood; in many cases we see, expectations are exceeded as it’s difficult to describe in words what is ultimately a very visual and immersive experience.” Richard Das, senior manager at Deloitte Digital, agrees. “As the say- ing goes, if you judge a fish by its ability to climb a tree, you’ll be dis- appointed,” he says. “Because we bring many of our preconceptions to the table of what tech is, it’s hard to measure expectations of what it could be.” Dr Karen Correia da Silva, senior social scientist at consumer behav- iour specialists Canvas8, points out that Google Glass is succeed- ing in the B2B space. “An adapted version is thriving in US facto- ries,” she says. “At DHL, employ- ees used Glass to streamline the package-picking process, improving efficiency by 15 per cent. Google tried jumping all the way to the customer applications when the product and tech perhaps weren’t quite there. But when it shifted its focus to a place that could get value out of the technology as it was at the time, it succeeded.” The dearth of XR use-cases is a worry, though it is expected to improve before long. “Limited software or applications will always restrict demand, or kill the hype, for a technically sound product,” says Mark Bates, general manager of Hire Intelligence, a B2B rental organisation that has seen a 394 per cent increase in XR hardware inquires in the last two years. “The power and potential of XR is strong, but the loop must be closed between industry needs, hardware capability and application development. Once applications are rel- evant, senior personnel in industry will trial the tech and then word of mouth about the quality of experience will drive greater adoption.” For Rebecca Gregory-Clarke, head of immersive technology at Digital Catapult, it is clear that business leaders have to look past the hype and focus on matur- ing XR. She concludes: “For those looking to take full advantage of immersive technology, it’s important to get involved now to be well positioned to take maximum advantage once the technology has fully evolved. We’re currently in the ‘black-and-white TV’ era of XR, a nascent version of a now-ubiquitous technology.” Grounding tech in extended reality XR FOR BUSINESS @raconteur /raconteur.net @raconteur_london The significant potential of reality technologies should not be lost in past hype and disappointment STEPHENARMSTRONG Contributor to The Sunday Times, Monocle, Wallpaper* and GQ, he is also an occasional broadcaster on BBC Radio. SOPHIE CHARARA Associate editor at The AmbientandWareable, she is also a freelance writer on technology and pop culture, with bylines in Stuff,WIREDand Forbes. ANNA CODREA-RADO Freelance culture and technology journalist, her work has been published in The New York Times, The Guardian and WIRED. NICK EASEN Award-winning freelance journalist and broadcaster, he produces for BBC World News, and writeson business,economics,science, technologyandtravel. OLIVER PICKUP Award-winning journalist, he specialises in technology, business and sport, and contributes to a wide range of publications. EMMA WOOLLACOTT Specialist technology writer, she covers legal and regulatory issues, and has contributed to Forbes and the New Statesman. Distributed in OLIVER PICKUP Distributed in association with CONTRIBUTORS TimothyFadek/CorbisviaGettyImages DEVELOPMENT Publishing manager Frank Monaghan Digital content executive Fran Cassidy Head of production Justyna O'Connell Design Joanna Bird Grant Chapman Sara Gelfgren Kellie Jerrard Samuele Motta Head of design Tim Whitlock Production editor Benjamin Chiou Managing editor Peter Archer Although this publication is funded through advertising and sponsorship, all editorial is without bias and sponsored features are clearly labelled. For an upcoming schedule, partnership inquiries or feedback, please call +44 (0)20 3877 3800 or email info@raconteur.net Raconteur is a leading publisher of special-interest content and research. Its publications and articles cover a wide range of topics, including business, finance, sustainability, healthcare, lifestyle and technology. Raconteur special reports are published exclusively in The Times and The Sunday Times as well as online at raconteur.net The information contained in this publication has been obtained from sources the Proprietors believe to be correct. However, no legal liability can be accepted for any errors. No part of this publication may be reproduced without the prior consent of the Publisher. © Raconteur Media raconteur.net The original model of Google Glass failed to live up to the hype Bringing immersive technology to business info@makereal.co.uk +44 (0)845 0178 777 Why not arrange to meet and learn more? For over a decade, Make Real has been working with the enterprise sector to design, develop and deploy mission critical business applications. We don’t hype specific technologies, we evangelise the real benefits. We believe in using the right tools to meet business challenges and add value, whether it’s augmented reality, virtual reality, simulation or serious games. Top concerns about XR startups Concerns startups hear from potential investors Slow adoption 71% Lack of an established market for the technology 67% Untested technology 18% Perkins Coie 2018

4. 04 RACONTEUR.NET 05XR FOR BUSINESS N obody wants to sink money in a gimmick and there’s often a good case to be made for hanging back a little to watch how well a new technology works out for early adopters. However, there comes a time when an innovation has proved its worth and it’s important to recognise when that point has been reached. Whether it’s Eastman Kodak’s failure to invest in digital photography or Blockbuster dismissing the idea of streaming video, corporate history is littered with examples of organisations that simply missed the boat. It’s hardly surprising that many organisations have taken a sceptical view of XR (extended reality), seeing it perhaps as a consumer technology that has no real place in the commercial world. However, this could be a big mis- take. With investment pouring into the area from the likes of Microsoft, ODG and Meta, analysts see it as a booming technology that’s set for far more widespread adoption. “Virtual reality (VR) and augmented reality (AR) technologies are developing rapidly, with proof of concepts and production deploy- ments laying solid foundations for widespread business adoption,” says Mark Lillie, global chief information officer programme leader at Deloitte. “One of the most startling things about the current landscape is that there are two extremes when it comes to understanding. We either get a client approaching us who knows exactly what they want, the context that it’s going to be used in and the potential benefits to their organisation. Or we get clients who really have no idea what they want, they just know they need to be looking at immersive technology for their future competitiveness.” BIS Research predicts that the market for AR will rise from $3.48 billion in 2017 to a staggering $198.17 billion by 2025, a compound annual growth rate of 65.1 per cent. The technology can, it says in a recent report, be seen as just as ground-breaking as the development of personal computers back in 1981. And in a survey earlier this year, technology industry association CompTIA found that three quarters of companies were aware of VR, with one in five already having a VR/ AR initiative underway; just under a quarter are piloting the technology. “Truthfully, we’re seeing less and less resistance from C-suite executives and decision-makers when it comes to VR, AR and MR [mixed reality], certainly in comparison to even just three years ago,” says Shaun Allan, chief XR officer at digital consultancy hedgehog lab. Return on investment in reality technologies can be protracted, such are the lengthy development times Face up to reality before it’s too late RoI EMMA WOOLLACOTT SerrahGalosonUnsplash Many organisations fail to understand the amount of time and money required The most common current use of XR is in employee training, cited by 62 per cent in the CompTIA survey, with half of early adopters using XR in customer engagements. Other early uses include virtual meetings (47 per cent), research and development simulations (45 per cent) and on-the- job information, delivering information to an employee while they are engaged with a task (43 per cent). James Burrows, technical director at Immersive Studios, says his company’s clients are happy using VR in these niches because there’s already a wealth of successful case studies making the value proposition clear. “That doesn’t mean we’re not seeing new, novel or unusual briefs, but certainly we have started noticing certain consistent trends in the what, where and when of VR/AR,” he says. “This means clients who fall outside those parameters tend to be more cautious, for the simple rea- son there isn’t the same body of proven success.” However, hanging back may mean missing the boat, as XR is not a technology that can be implemented overnight, and many organisations failtounderstandtheamountoftime and money required. Generating content is comparable to producing a video game; it’s time consuming and requires highly skilled professionals. “Clients have had a good ten years of getting a handle on average budgets for more traditional apps and web- based projects, but suddenly those assumptions go out of the window when you add an AR or VR element into the project,” says Mr Burrows. “We’re only now getting to the point where clients are starting to understand the level of work which goes into producing these sorts of experiences and are planning these sorts of amounts into their budgets.” This high cost applies even in the proof-of-concept (PoC) stage. “Firms should work with the sup- plier to scope the PoC so it fits their budget and objective," says Jim Tramontana, senior product manager at Honeywell Process Solutions. “Toooften,companiestrytovalidate the technology by testing the entire scope of the implementation. This results in firms finding the PoC itself too expensive and lengthy, meaning results are difficult to validate.” However, for those organisations that are prepared to take the risk and make the necessary investment, the rewards can be significant. According to a recent report from the Capgemini Research Institute, 82 per cent of companies currently implementing AR/VR say the benefits are either meeting or exceeding their expectations. Indeed, efficiency improvements mean that three quarters of companies with large-scale implementa- tions say they’re seeing operational benefits of more than 10 per cent. Last year, for example, KFC intro- duced a VR training simulation to teach its “secret recipe” for prepar- ing chicken. Using the simulation, trainees were able to master the five steps of making fried chicken in ten minutes, compared with twenty five minutes for conventional teaching. Meanwhile, Boeing cut the time engineers needed for wiring production time by 25 per cent, after replacing assembly manuals with smartglasses displays. “For businesses that are still ret- icent about immersive technology, we usually counter with the same argument, no matter what the industry. That is if they don’t start looking at this now, they’re dead in the water because one or more of their competitors will be,” says hedgehog lab’s Mr Allan. “Simply put, if they don’t at least dip their toe and have a go, they’re going to be playing catch-up with their competitors soon enough.”CompTIA 2017 Current state of XR adoption XR initiative already underway 21% Experimenting/ piloting with XR 23% Planning to have XR initiative in next year 18% No current plans/not sure 39% Ways XR is used by early adopters Employee training 62% Customer engagement 50% Virtual meetings 47% Simulation in R&D 45% On-the-job information 43% Commercial feature S ince Bryn Mooser co-founded immersive media company RYOT in 2012, the studio has been pushing the boundaries of what can be produced with VR and AR. The idea of the company goes back to the time he spent in Haiti’s capital city Port-au-Prince, after the devastating earthquake of 2010. “I moved down to build a high school and when I was there I met my co-founder David Darg. We were both film-makers who had an interest in humanitarian work and we started making films there,” explains Mr Mooser. It was very clear to him that the global view of Haiti was cynical and many people felt like there was nothing they could do about global problems, but as technology advanced and connected people around the world through social media, there was no longer any excuse to do nothing. “RYOT started as a news website with a function where every story had an action, so when you read about something in the world, you could actually do something about it, whether it be to sign a petition, vol- unteer or donate,” says Mr Mooser. From creating the world’s first all-VR film in a war zone with Welcome to Aleppo to the first in natural disas- ter VR with The Nepal Project, RYOT’s work is now defining what is possible in a fully VR world. “My mission has always been how do we use technology to try and make the world a better place? We began to experiment with new technologies to tell stories and we found our perfect medium with VR,” explains Mr Mooser. RYOT quickly made a name for itself as the go-to VR firm for news and documentaries, and developed VR content for high-profile companies, including The Associated Press, HuffPost and The New York Times. Today RYOT is focused on building what the future of content and media will look like in a 5G world. “What will a movie or TV show look like in 5G and how will you watch content in the back of your driverless car when it’s enabled with 5G? We believe 5G is ushering in the fourth industrial revolution; it’s like nothing that has come before and it will create major disruptions in all industries, from mobility to health to technology,” says Mr Mooser. Super-fast 5G internet will not only offer mobile users more stable con- nections and low latency, but this game-changing innovation is set to unlock exciting new types of experiences. “We are focused on how to help build and enable the products of the future, so the consumers of tomorrow can’t live without 5G,” says Mr Mooser. Transitioning to a more AR-friendly digital environment may not be the leap many consumers expect it to be. For example, although few users will be fully aware of the underlying AR technology, every time face fil- ters are used in popular social media apps, they will be becoming more comfortable with AR applications. Businesses are building new products and services that are going to enable consumers and businesses alike to do things they never dreamed possible via 5G. “It’s not enough to just have lower latency and better download speeds. The 5G solutions that leverage those benefits could be amazing. But is that enough to get somebody to switch phones? I don’t know,” says Mr Mooser. Ideas that were once based in science fiction are on course to become increasingly feasible thanks to the power of 5G. Driverless cars will be able to communicate with each other driving down the road and the near real-time rendering of items in AR can be wholly achieved. “We’re at the tipping point right now and we’re looking at how to bring forward-thinking companies on to the bleeding edge of technology, and use that technology to tell stories in a new way and capture a new audience,” says Mr Mooser. If companies want to remain at the top of their market, it’s no longer possible for them to gloss over AR/ VR technologies and 5G-enabled services, as the impact of these solutions will mean every industry is about to experience a dramatic disruption. A fully 5G-enabled world will fundamentally change the enter- tainment experience for viewers, in part thanks to the ability of advanced computing in the cloud. Mr Mooser believes leaders will approach 5G in one of two ways. “Either they’re going to take con- trol of the tremendous opportunity to lead into the future or get left behind, which if you look at histori- cal trends, is what happens to many,” he says. In an age of disruptive startups that have the power to transform entire industries through the use of new technologies, it’s now up to businesses to make sure they are inno- vating fast with the right partners. Mr Mooser concludes: “From a business perspective, there has never been a more exciting time.” For further information please visit www.ryot.org RYOT is focused on building what the future of content and media will look like in a 5G world Bryn Mooser Founder, RYOT 5G coming of age Virtual reality (VR) and augmented reality (AR) clearly have the potential to change dramatically how we perceive the world around us. But much more work has to be done for these technologies to move from their current limited phase to become a truly transformative power and revolutionise how content is consumed

5. 04 RACONTEUR.NET 05XR FOR BUSINESS N obody wants to sink money in a gimmick and there’s often a good case to be made for hanging back a little to watch how well a new technology works out for early adopters. However, there comes a time when an innovation has proved its worth and it’s important to recognise when that point has been reached. Whether it’s Eastman Kodak’s failure to invest in digital photography or Blockbuster dismissing the idea of streaming video, corporate history is littered with examples of organisations that simply missed the boat. It’s hardly surprising that many organisations have taken a sceptical view of XR (extended reality), seeing it perhaps as a consumer technology that has no real place in the commercial world. However, this could be a big mis- take. With investment pouring into the area from the likes of Microsoft, ODG and Meta, analysts see it as a booming technology that’s set for far more widespread adoption. “Virtual reality (VR) and augmented reality (AR) technologies are developing rapidly, with proof of concepts and production deploy- ments laying solid foundations for widespread business adoption,” says Mark Lillie, global chief information officer programme leader at Deloitte. “One of the most startling things about the current landscape is that there are two extremes when it comes to understanding. We either get a client approaching us who knows exactly what they want, the context that it’s going to be used in and the potential benefits to their organisation. Or we get clients who really have no idea what they want, they just know they need to be looking at immersive technology for their future competitiveness.” BIS Research predicts that the market for AR will rise from $3.48 billion in 2017 to a staggering $198.17 billion by 2025, a compound annual growth rate of 65.1 per cent. The technology can, it says in a recent report, be seen as just as ground-breaking as the development of personal computers back in 1981. And in a survey earlier this year, technology industry association CompTIA found that three quarters of companies were aware of VR, with one in five already having a VR/ AR initiative underway; just under a quarter are piloting the technology. “Truthfully, we’re seeing less and less resistance from C-suite executives and decision-makers when it comes to VR, AR and MR [mixed reality], certainly in comparison to even just three years ago,” says Shaun Allan, chief XR officer at digital consultancy hedgehog lab. Return on investment in reality technologies can be protracted, such are the lengthy development times Face up to reality before it’s too late RoI EMMA WOOLLACOTT SerrahGalosonUnsplash Many organisations fail to understand the amount of time and money required The most common current use of XR is in employee training, cited by 62 per cent in the CompTIA survey, with half of early adopters using XR in customer engagements. Other early uses include virtual meetings (47 per cent), research and development simulations (45 per cent) and on-the- job information, delivering information to an employee while they are engaged with a task (43 per cent). James Burrows, technical director at Immersive Studios, says his company’s clients are happy using VR in these niches because there’s already a wealth of successful case studies making the value proposition clear. “That doesn’t mean we’re not seeing new, novel or unusual briefs, but certainly we have started noticing certain consistent trends in the what, where and when of VR/AR,” he says. “This means clients who fall outside those parameters tend to be more cautious, for the simple rea- son there isn’t the same body of proven success.” However, hanging back may mean missing the boat, as XR is not a technology that can be implemented overnight, and many organisations failtounderstandtheamountoftime and money required. Generating content is comparable to producing a video game; it’s time consuming and requires highly skilled professionals. “Clients have had a good ten years of getting a handle on average budgets for more traditional apps and web- based projects, but suddenly those assumptions go out of the window when you add an AR or VR element into the project,” says Mr Burrows. “We’re only now getting to the point where clients are starting to understand the level of work which goes into producing these sorts of experiences and are planning these sorts of amounts into their budgets.” This high cost applies even in the proof-of-concept (PoC) stage. “Firms should work with the sup- plier to scope the PoC so it fits their budget and objective," says Jim Tramontana, senior product manager at Honeywell Process Solutions. “Toooften,companiestrytovalidate the technology by testing the entire scope of the implementation. This results in firms finding the PoC itself too expensive and lengthy, meaning results are difficult to validate.” However, for those organisations that are prepared to take the risk and make the necessary investment, the rewards can be significant. According to a recent report from the Capgemini Research Institute, 82 per cent of companies currently implementing AR/VR say the benefits are either meeting or exceeding their expectations. Indeed, efficiency improvements mean that three quarters of companies with large-scale implementa- tions say they’re seeing operational benefits of more than 10 per cent. Last year, for example, KFC intro- duced a VR training simulation to teach its “secret recipe” for prepar- ing chicken. Using the simulation, trainees were able to master the five steps of making fried chicken in ten minutes, compared with twenty five minutes for conventional teaching. Meanwhile, Boeing cut the time engineers needed for wiring production time by 25 per cent, after replacing assembly manuals with smartglasses displays. “For businesses that are still ret- icent about immersive technology, we usually counter with the same argument, no matter what the industry. That is if they don’t start looking at this now, they’re dead in the water because one or more of their competitors will be,” says hedgehog lab’s Mr Allan. “Simply put, if they don’t at least dip their toe and have a go, they’re going to be playing catch-up with their competitors soon enough.”CompTIA 2017 Current state of XR adoption XR initiative already underway 21% Experimenting/ piloting with XR 23% Planning to have XR initiative in next year 18% No current plans/not sure 39% Ways XR is used by early adopters Employee training 62% Customer engagement 50% Virtual meetings 47% Simulation in R&D 45% On-the-job information 43% Commercial feature S ince Bryn Mooser co-founded immersive media company RYOT in 2012, the studio has been pushing the boundaries of what can be produced with VR and AR. The idea of the company goes back to the time he spent in Haiti’s capital city Port-au-Prince, after the devastating earthquake of 2010. “I moved down to build a high school and when I was there I met my co-founder David Darg. We were both film-makers who had an interest in humanitarian work and we started making films there,” explains Mr Mooser. It was very clear to him that the global view of Haiti was cynical and many people felt like there was nothing they could do about global problems, but as technology advanced and connected people around the world through social media, there was no longer any excuse to do nothing. “RYOT started as a news website with a function where every story had an action, so when you read about something in the world, you could actually do something about it, whether it be to sign a petition, vol- unteer or donate,” says Mr Mooser. From creating the world’s first all-VR film in a war zone with Welcome to Aleppo to the first in natural disas- ter VR with The Nepal Project, RYOT’s work is now defining what is possible in a fully VR world. “My mission has always been how do we use technology to try and make the world a better place? We began to experiment with new technologies to tell stories and we found our perfect medium with VR,” explains Mr Mooser. RYOT quickly made a name for itself as the go-to VR firm for news and documentaries, and developed VR content for high-profile companies, including The Associated Press, HuffPost and The New York Times. Today RYOT is focused on building what the future of content and media will look like in a 5G world. “What will a movie or TV show look like in 5G and how will you watch content in the back of your driverless car when it’s enabled with 5G? We believe 5G is ushering in the fourth industrial revolution; it’s like nothing that has come before and it will create major disruptions in all industries, from mobility to health to technology,” says Mr Mooser. Super-fast 5G internet will not only offer mobile users more stable con- nections and low latency, but this game-changing innovation is set to unlock exciting new types of experiences. “We are focused on how to help build and enable the products of the future, so the consumers of tomorrow can’t live without 5G,” says Mr Mooser. Transitioning to a more AR-friendly digital environment may not be the leap many consumers expect it to be. For example, although few users will be fully aware of the underlying AR technology, every time face fil- ters are used in popular social media apps, they will be becoming more comfortable with AR applications. Businesses are building new products and services that are going to enable consumers and businesses alike to do things they never dreamed possible via 5G. “It’s not enough to just have lower latency and better download speeds. The 5G solutions that leverage those benefits could be amazing. But is that enough to get somebody to switch phones? I don’t know,” says Mr Mooser. Ideas that were once based in science fiction are on course to become increasingly feasible thanks to the power of 5G. Driverless cars will be able to communicate with each other driving down the road and the near real-time rendering of items in AR can be wholly achieved. “We’re at the tipping point right now and we’re looking at how to bring forward-thinking companies on to the bleeding edge of technology, and use that technology to tell stories in a new way and capture a new audience,” says Mr Mooser. If companies want to remain at the top of their market, it’s no longer possible for them to gloss over AR/ VR technologies and 5G-enabled services, as the impact of these solutions will mean every industry is about to experience a dramatic disruption. A fully 5G-enabled world will fundamentally change the enter- tainment experience for viewers, in part thanks to the ability of advanced computing in the cloud. Mr Mooser believes leaders will approach 5G in one of two ways. “Either they’re going to take con- trol of the tremendous opportunity to lead into the future or get left behind, which if you look at histori- cal trends, is what happens to many,” he says. In an age of disruptive startups that have the power to transform entire industries through the use of new technologies, it’s now up to businesses to make sure they are inno- vating fast with the right partners. Mr Mooser concludes: “From a business perspective, there has never been a more exciting time.” For further information please visit www.ryot.org RYOT is focused on building what the future of content and media will look like in a 5G world Bryn Mooser Founder, RYOT 5G coming of age Virtual reality (VR) and augmented reality (AR) clearly have the potential to change dramatically how we perceive the world around us. But much more work has to be done for these technologies to move from their current limited phase to become a truly transformative power and revolutionise how content is consumed

6. 06 RACONTEUR.NET 07XR FOR BUSINESS No standardisation “There are more than eight different VR/AR platforms that developers work on, with no clear leader in sight and no concerted effort towards standardisation,” explains Thanos Malevitis, Accenture Strategy’s managing director for technology, communications and media. “Major platform companies with advanced software, hardware and content capabilities may be able to go it alone by taking advantage of ‘win- ner takes most’ platform dynamics, but others will need to work together in robust ecosystems to overcome Hardware Currently VR and AR headsets are bulky and expensive, tethered to specific platforms and unable to display realistic pictures. This has alienated consumers and hin- dered the development of business-to-consumer XR. Again, AR is performing better than VR in this area. Solomon Rogers, founder and chief executive of immersive content specialist Rewind, cites German lift manufacturer Thyssen, which has deployed mixed reality HoloLens for its technicians as it “has so many different models of lift that not every technician knows every lift”. He explains: “They can No optimisation Software and devices used across industries will have to be opti- mised for 3D experiences, explains Accenture Strategy’s Mr Malevitis. According to the XR Industry Survey 2018, potential adopters are deterred by the lack of proof of return on investment, and the challenge of integrating the technology with existing systems and processes. “In most cases the benefit of XR is measured on user experience, which is difficult to quantify and compare against costly software and device investment,” Mr Malevitis explains. “Unlike cloud-based solutions or analytics and machine-learning, the business case is less tangible.” To overcome this, Amazon’s Sumerian, Google Blocks and Adobe Aero, among others, offer building-block technologies, tools to Limited content For consumers, lack of content has proved a huge problem. “Oculus Rift rushed into its huge investment in hardware, but when the headset launched, there was almost no content,” says Rewind’s Mr Rogers. “Oculus is spending $0.5 billion into content, but the killer app isn’t clear. There are only a few companies right now that know how to make good XR content and, for pro- fessional developers, it may not be worth their time or budget relative to the installed base.” Mr Rogers believes AR, which overlays virtual images on to the real world, as with 2016 sensation Pokémon Go, is likely to spread faster than VR in business to consumer thanks to its ease of use and existing content. “There is the lack of standards and realise the full potential of their investments.” There is an OpenXR initiative from the likes of Oculus, Vale, Unity, Epic, Samsung, Magic Leap and Google, among others, which aims to develop a cross-platform VR standard so applications only need to be written once to run on any VR system. Until the standard is in the market, purchasing decisions on XR may be held up. look at a lift and navigate fixing it with a feed back to base.” Although in a market with no clearly defined leader, even Microsoft HoloLens has issues with convenience andpricetag,whichlowersthechances for widespread corporate use, accord- ingtoAndrewMakarov,headofmobile development at MobiDev. The answer might be right under our noses as mobilephonesareprovingsuccessfulat deliveringAR,althoughwithVRthey’re lessconsistent. Ironically, there’s already evidence that the smartphone itself will dis- appear as XR spreads. In the future, phones will be smart wearables, like earbuds that have biometric sensors and speakers, or rings and bracelets that can sense motion, and glasses that record and display information, according to Amy Webb, founder of the Future Today Institute. build XR experiences through drag- and-drop assets. An early proto- type built on Sumerian by Fidelity Labs involves a repurposed 3D virtual persona, or host, that pro- vides voice-guided visualisation for investment data. “Virtual hosts are probably the biggest building block of Sumerian that’s obvious right now,” says Amazon Sumerian’s general manager Kyle Roche. “Having a character you can make eye contact with, set up in the same way you’d set up an Alexa skill, just drag and drop in a browser, is very attractive for some customers. You don’t need specialised programming or 3D graphics expertise.” Mr Rogers at Rewind concludes: “In the long run, everything will be fine. The problem with the tech industry is that we’re always washing our laundry in public; no one has time to develop well, so they ship alpha and beta versions for testing which fail fast and often. That’s good product design, but tough when you’re trying to convince the public.” a sense that businesses are looking for use-cases; IKEA has a fur- niture app that’s brilliant. I can put chairs in every corner of my room,” he says. “But that’s not enough of an incentive for a consumer to invest.” The forthcoming Harry Potter Wizards Unite AR game, in which players find objects, fight each other or unite to defeat monsters, will be an important demonstration of potential. “Microsoft’s HoloLens is working with developer Black Marble on truServe, a scene of crime investigation app,” says Mr Rogers. “It allows you to over- lay clues, keep track of what you know and place virtual markers or gather multimedia evidence without disturbing the physical scene and potentially tainting evidence. It’s a little like a crime scene investigation game, so as developers see what Harry Potter can do, they will take inspiration for business uses.” Different design language This is film-maker Sir Ridley Scott’s problem: when the eye isn’t targeted to just a small range of viewing, but can rotate 360 degrees, designers have to adapt to an entirely new way of creating things. Designers need to get a 3D game engine, learn how to sculpt, animate and rig complex things when they actually want something that’s easy to use in a familiar environment. “It’s about internal buy-in,” says Gareth Coombes from the Cambridge Strategy Centre. “People don’t like change. Innovation tech companies have to find internal stakeholders to prove they have to spend some money to make some money.” What are the main barriers to adopting extended reality and how can you overcome them? Five obstacles to leap for successful XR BARRIERS TO ADOPTION STEPHEN ARMSTRONG Commercial feature T he potential application of virtual and cross reality in enterprise is enormous, particularly when visual and engaging experiences clinch sales. As a result, the real estate industry will see some of the biggest growth in its use, given its need to demonstrate what properties will be like to walk aroundandlivein,beforetheyarebuilt. Its normal practice remains remark- ably low tech, with sellers promoting properties with glossy brochures and generally quite basic information. The same is true for architects and interior designers wanting to demonstrate their ideas much better. The latest VR and XR systems enable potential customers to view and take a virtual look around developments inter- actively, and they can be anywhere in the world while they are doing so. “The traditional way of promoting new luxury properties in different locations is that the builder will go out and conduct roadshows, one in the United States, one in Singapore, and around the world. So you have people carrying brochures or models, trying hard to convey what it will really be like,” explains Shailesh Goswami (Gosu), founder and chief executive of FOYR, which creates VR and XR systems for the industry. “Building firms can use our technology to share links to virtual experiences. There are no headsets and there’s no special technology; everyone can see what the new property will actually be like using their normal devices.” VR and XR becoming affordable reality for all real estate Virtual and cross reality systems are yet to go truly mainstream outside computer gaming, but that could soon change as the platforms become open to developers, architects and interior designers FOYR’s systems are available on any web browser or smartphone, and they are designed to be inter- active and intuitive. Typically, architects, interior designers or property developers would have found it com- plicated and expensive to present a virtual reality experience to a customer, but with the new technology, the experiences can be easily rolled out from their designs, automatically rendered for low-power devices. A crucial element of making this effective is a focus on transferring content from legacy software already in use by architecture, design or property development firms, so they are not obliged to start from scratch. Integrating pertinent data is also a key part of the process, with end-users able to request real-world details about specific properties or designs they are encountering virtually. “Our aim is to simplify and democratise virtual experience creation,” says Mr Goswami. “Part of that is about making it extremely easy for people to use. We want to make it possible for anyone to create and offer virtual designs and experiences very quickly.” For FOYR, there is a dual focus on making platforms as easy to use as possible, while also making them powerful enough to be relied upon for demon- strating quality design in detail. To this end, the integration of artificial intelligence has become vital because it can be used routinely and automatically to resolve any experience issues, as well as recognising existing complex char- acteristics on any design project for faster rendering. For the growth of VR and XR as a whole, Mr Goswami views the wider reliance on specially designed headsets as a lingering hindrance. Making VR experiences available via browsers and smartphones will go a long way towards democratising the processes across sectors. “I still think it’s going to be a couple of years before some of these alternatives become really widespread,” he says. “Until then our work is to simplify the whole VR and virtual experience creation process and make it so that you can write the code. To sell property designs or other experiential products, you have to have powerful VR that runs on everyone’s normal devices.” To find out more about simple and accessible VR and XR in real estate and interior design please visit foyr.com Our aim is to simplify and democratise virtual experience creation B ack in 2015, film director Sir Ridley Scott was over- seeing the The Man in the High Castle for Amazon and Ryan Gosling in the Blade Runner sequel. Sir Ridley has always experimented with new technologies – he was an early sup- plier to Amazon’s streaming ser- vice – and decided to take a look at virtual reality (VR) as a possible creative medium. “The problems were complex,” he explained shortly afterwards. “It’s hard to focus on a story when you have infinite choices, and fast cutting and editing make people feel queasy. I’m not sure it’s the best sto- rytelling medium.” The following year, there was a rush into VR from games companies, documentary makers and art- ists, but since then, VR penetra- tion has slowed down. There are signs, however, that extended reality (XR) – VR and its more accessible cousins augmented reality (AR) and augmented virtuality – could find a more natural home in the business world. Accenture’s Technology Vision 2018 survey found that more than 80 per cent of executives believe XR will create a new way for companies to interact, communicate and inform, while 27 per cent say it is very important for their organisations to be a pioneer in XR solutions. And yet growth has been slow for both. “The consumer sector and the enterprise sector have experi- enced similar amounts of growth, but the majority consensus is that this growth has been weaker than hoped for consumers category,” according to Simon Portman, technology lawyer at Marks & Clerk. So what are the five biggest barriers to entry and how easy are they to overcome?

7. 06 RACONTEUR.NET 07XR FOR BUSINESS No standardisation “There are more than eight different VR/AR platforms that developers work on, with no clear leader in sight and no concerted effort towards standardisation,” explains Thanos Malevitis, Accenture Strategy’s managing director for technology, communications and media. “Major platform companies with advanced software, hardware and content capabilities may be able to go it alone by taking advantage of ‘win- ner takes most’ platform dynamics, but others will need to work together in robust ecosystems to overcome Hardware Currently VR and AR headsets are bulky and expensive, tethered to specific platforms and unable to display realistic pictures. This has alienated consumers and hin- dered the development of business-to-consumer XR. Again, AR is performing better than VR in this area. Solomon Rogers, founder and chief executive of immersive content specialist Rewind, cites German lift manufacturer Thyssen, which has deployed mixed reality HoloLens for its technicians as it “has so many different models of lift that not every technician knows every lift”. He explains: “They can No optimisation Software and devices used across industries will have to be opti- mised for 3D experiences, explains Accenture Strategy’s Mr Malevitis. According to the XR Industry Survey 2018, potential adopters are deterred by the lack of proof of return on investment, and the challenge of integrating the technology with existing systems and processes. “In most cases the benefit of XR is measured on user experience, which is difficult to quantify and compare against costly software and device investment,” Mr Malevitis explains. “Unlike cloud-based solutions or analytics and machine-learning, the business case is less tangible.” To overcome this, Amazon’s Sumerian, Google Blocks and Adobe Aero, among others, offer building-block technologies, tools to Limited content For consumers, lack of content has proved a huge problem. “Oculus Rift rushed into its huge investment in hardware, but when the headset launched, there was almost no content,” says Rewind’s Mr Rogers. “Oculus is spending $0.5 billion into content, but the killer app isn’t clear. There are only a few companies right now that know how to make good XR content and, for pro- fessional developers, it may not be worth their time or budget relative to the installed base.” Mr Rogers believes AR, which overlays virtual images on to the real world, as with 2016 sensation Pokémon Go, is likely to spread faster than VR in business to consumer thanks to its ease of use and existing content. “There is the lack of standards and realise the full potential of their investments.” There is an OpenXR initiative from the likes of Oculus, Vale, Unity, Epic, Samsung, Magic Leap and Google, among others, which aims to develop a cross-platform VR standard so applications only need to be written once to run on any VR system. Until the standard is in the market, purchasing decisions on XR may be held up. look at a lift and navigate fixing it with a feed back to base.” Although in a market with no clearly defined leader, even Microsoft HoloLens has issues with convenience andpricetag,whichlowersthechances for widespread corporate use, accord- ingtoAndrewMakarov,headofmobile development at MobiDev. The answer might be right under our noses as mobilephonesareprovingsuccessfulat deliveringAR,althoughwithVRthey’re lessconsistent. Ironically, there’s already evidence that the smartphone itself will dis- appear as XR spreads. In the future, phones will be smart wearables, like earbuds that have biometric sensors and speakers, or rings and bracelets that can sense motion, and glasses that record and display information, according to Amy Webb, founder of the Future Today Institute. build XR experiences through drag- and-drop assets. An early proto- type built on Sumerian by Fidelity Labs involves a repurposed 3D virtual persona, or host, that pro- vides voice-guided visualisation for investment data. “Virtual hosts are probably the biggest building block of Sumerian that’s obvious right now,” says Amazon Sumerian’s general manager Kyle Roche. “Having a character you can make eye contact with, set up in the same way you’d set up an Alexa skill, just drag and drop in a browser, is very attractive for some customers. You don’t need specialised programming or 3D graphics expertise.” Mr Rogers at Rewind concludes: “In the long run, everything will be fine. The problem with the tech industry is that we’re always washing our laundry in public; no one has time to develop well, so they ship alpha and beta versions for testing which fail fast and often. That’s good product design, but tough when you’re trying to convince the public.” a sense that businesses are looking for use-cases; IKEA has a fur- niture app that’s brilliant. I can put chairs in every corner of my room,” he says. “But that’s not enough of an incentive for a consumer to invest.” The forthcoming Harry Potter Wizards Unite AR game, in which players find objects, fight each other or unite to defeat monsters, will be an important demonstration of potential. “Microsoft’s HoloLens is working with developer Black Marble on truServe, a scene of crime investigation app,” says Mr Rogers. “It allows you to over- lay clues, keep track of what you know and place virtual markers or gather multimedia evidence without disturbing the physical scene and potentially tainting evidence. It’s a little like a crime scene investigation game, so as developers see what Harry Potter can do, they will take inspiration for business uses.” Different design language This is film-maker Sir Ridley Scott’s problem: when the eye isn’t targeted to just a small range of viewing, but can rotate 360 degrees, designers have to adapt to an entirely new way of creating things. Designers need to get a 3D game engine, learn how to sculpt, animate and rig complex things when they actually want something that’s easy to use in a familiar environment. “It’s about internal buy-in,” says Gareth Coombes from the Cambridge Strategy Centre. “People don’t like change. Innovation tech companies have to find internal stakeholders to prove they have to spend some money to make some money.” What are the main barriers to adopting extended reality and how can you overcome them? Five obstacles to leap for successful XR BARRIERS TO ADOPTION STEPHEN ARMSTRONG Commercial feature T he potential application of virtual and cross reality in enterprise is enormous, particularly when visual and engaging experiences clinch sales. As a result, the real estate industry will see some of the biggest growth in its use, given its need to demonstrate what properties will be like to walk aroundandlivein,beforetheyarebuilt. Its normal practice remains remark- ably low tech, with sellers promoting properties with glossy brochures and generally quite basic information. The same is true for architects and interior designers wanting to demonstrate their ideas much better. The latest VR and XR systems enable potential customers to view and take a virtual look around developments inter- actively, and they can be anywhere in the world while they are doing so. “The traditional way of promoting new luxury properties in different locations is that the builder will go out and conduct roadshows, one in the United States, one in Singapore, and around the world. So you have people carrying brochures or models, trying hard to convey what it will really be like,” explains Shailesh Goswami (Gosu), founder and chief executive of FOYR, which creates VR and XR systems for the industry. “Building firms can use our technology to share links to virtual experiences. There are no headsets and there’s no special technology; everyone can see what the new property will actually be like using their normal devices.” VR and XR becoming affordable reality for all real estate Virtual and cross reality systems are yet to go truly mainstream outside computer gaming, but that could soon change as the platforms become open to developers, architects and interior designers FOYR’s systems are available on any web browser or smartphone, and they are designed to be inter- active and intuitive. Typically, architects, interior designers or property developers would have found it com- plicated and expensive to present a virtual reality experience to a customer, but with the new technology, the experiences can be easily rolled out from their designs, automatically rendered for low-power devices. A crucial element of making this effective is a focus on transferring content from legacy software already in use by architecture, design or property development firms, so they are not obliged to start from scratch. Integrating pertinent data is also a key part of the process, with end-users able to request real-world details about specific properties or designs they are encountering virtually. “Our aim is to simplify and democratise virtual experience creation,” says Mr Goswami. “Part of that is about making it extremely easy for people to use. We want to make it possible for anyone to create and offer virtual designs and experiences very quickly.” For FOYR, there is a dual focus on making platforms as easy to use as possible, while also making them powerful enough to be relied upon for demon- strating quality design in detail. To this end, the integration of artificial intelligence has become vital because it can be used routinely and automatically to resolve any experience issues, as well as recognising existing complex char- acteristics on any design project for faster rendering. For the growth of VR and XR as a whole, Mr Goswami views the wider reliance on specially designed headsets as a lingering hindrance. Making VR experiences available via browsers and smartphones will go a long way towards democratising the processes across sectors. “I still think it’s going to be a couple of years before some of these alternatives become really widespread,” he says. “Until then our work is to simplify the whole VR and virtual experience creation process and make it so that you can write the code. To sell property designs or other experiential products, you have to have powerful VR that runs on everyone’s normal devices.” To find out more about simple and accessible VR and XR in real estate and interior design please visit foyr.com Our aim is to simplify and democratise virtual experience creation B ack in 2015, film director Sir Ridley Scott was over- seeing the The Man in the High Castle for Amazon and Ryan Gosling in the Blade Runner sequel. Sir Ridley has always experimented with new technologies – he was an early sup- plier to Amazon’s streaming ser- vice – and decided to take a look at virtual reality (VR) as a possible creative medium. “The problems were complex,” he explained shortly afterwards. “It’s hard to focus on a story when you have infinite choices, and fast cutting and editing make people feel queasy. I’m not sure it’s the best sto- rytelling medium.” The following year, there was a rush into VR from games companies, documentary makers and art- ists, but since then, VR penetra- tion has slowed down. There are signs, however, that extended reality (XR) – VR and its more accessible cousins augmented reality (AR) and augmented virtuality – could find a more natural home in the business world. Accenture’s Technology Vision 2018 survey found that more than 80 per cent of executives believe XR will create a new way for companies to interact, communicate and inform, while 27 per cent say it is very important for their organisations to be a pioneer in XR solutions. And yet growth has been slow for both. “The consumer sector and the enterprise sector have experi- enced similar amounts of growth, but the majority consensus is that this growth has been weaker than hoped for consumers category,” according to Simon Portman, technology lawyer at Marks & Clerk. So what are the five biggest barriers to entry and how easy are they to overcome?

8. 08 RACONTEUR.NET 09XR FOR BUSINESS WHAT IS XR? Industry split on most exciting technology XR product company stakeholders were asked to choose the market that is the most promising A version of augmented reality, sometimes known as hybrid reality, that merges the real and virtual worlds and allows them to interact with each other in real time Mixed reality Computer-generated graphics overlaid on the physical world, typically used with mobiles and tablets through the camera Augmented reality Immersive headset experience presenting a computer- simulated, 360-degree-view reality in a virtual world Virtual reality When XR is expected to become mainstream Percentage of XR product company stakeholders who predict the following timeframes Jabil 2018 6% Already mainstream 29% 1-3 years 34% 4-5 years 22% 6-10 years 8% 10+ years 1% Never 6-10 years Top industry use-cases for business XR and consumer XR Percentage of XR product company stakeholders who believe the following will be impacted by XR technologies Business Consumer Medical 71% Manufacturing 47% Military 46% Industrial 35% Tourism 28% Retail 23% Transportation 20% Other 4% Jabil 2018 76% 36% 34% 30% 24% Transportation 17% Other 2% 60% Gaming Movies and television Medical Retail Tourism Ecommerce AR/VR spending worldwide in 2017 Market share by industry ($bn) When XR will generate a profit XR developers were asked when they thought AR, VR and MR would turn a profit for themselves and/or their clients Consumer Other Discrete manufacturing Retail Personal and consumer services Process manufacturing 6.2 3.7 1.5 1 0.8 0.7 38% Medium term 23% Long term 15% Currently profitable 11% Project not tied to profitability 12% Short term 1% Never IDC 2017 XRDC 2018 36% 26% 38% Extended reality or XR, a relatively new development in most circles, is an emerging umbrella term given to all computer-generated environments that either merge the physical and virtual worlds or create an entirely immersive experience for the user

9. 08 RACONTEUR.NET 09XR FOR BUSINESS WHAT IS XR? Industry split on most exciting technology XR product company stakeholders were asked to choose the market that is the most promising A version of augmented reality, sometimes known as hybrid reality, that merges the real and virtual worlds and allows them to interact with each other in real time Mixed reality Computer-generated graphics overlaid on the physical world, typically used with mobiles and tablets through the camera Augmented reality Immersive headset experience presenting a computer- simulated, 360-degree-view reality in a virtual world Virtual reality When XR is expected to become mainstream Percentage of XR product company stakeholders who predict the following timeframes Jabil 2018 6% Already mainstream 29% 1-3 years 34% 4-5 years 22% 6-10 years 8% 10+ years 1% Never 6-10 years Top industry use-cases for business XR and consumer XR Percentage of XR product company stakeholders who believe the following will be impacted by XR technologies Business Consumer Medical 71% Manufacturing 47% Military 46% Industrial 35% Tourism 28% Retail 23% Transportation 20% Other 4% Jabil 2018 76% 36% 34% 30% 24% Transportation 17% Other 2% 60% Gaming Movies and television Medical Retail Tourism Ecommerce AR/VR spending worldwide in 2017 Market share by industry ($bn) When XR will generate a profit XR developers were asked when they thought AR, VR and MR would turn a profit for themselves and/or their clients Consumer Other Discrete manufacturing Retail Personal and consumer services Process manufacturing 6.2 3.7 1.5 1 0.8 0.7 38% Medium term 23% Long term 15% Currently profitable 11% Project not tied to profitability 12% Short term 1% Never IDC 2017 XRDC 2018 36% 26% 38% Extended reality or XR, a relatively new development in most circles, is an emerging umbrella term given to all computer-generated environments that either merge the physical and virtual worlds or create an entirely immersive experience for the user

10. 10 RACONTEUR.NET 11XR FOR BUSINESS T he ongoing trade spat between Washington and Beijing certainly makes headline news, but behind the ruffling of feathers over steel pipes, wine and pork, there’s a much bigger agenda. “What they are fight- ing is not really a trade war, it’s a tech war. A tech war is also a manufacturing war,” according to Terry Gou, chairman of Foxconn. The Taiwanese electronics company should know; it employs more than a million workers, many in mainland China, and is a big sup- plier to Apple. These tensions have profound implications for the extended reality (XR) industries. Chinese investment in US tech firms has officially been soured as the Trump administration gets spikey over alleged intellectual property theft and unfair trade practices. “Both the US and China see themselves as having a manifest destiny to determine world affairs, and perceive their economic and cultural outputs as crucial to shaping how the 21st century plays out globally,” says Tim Mulligan, senior analyst at MIDiA Research. “Technological innovation is a crucial strand in establishing global leadership.” Alibaba, JD and Tencent are among the Chinese tech giants that have made big investments in America. Alibaba is of note having lavished hundreds of millions of dollars on ultra-secretive Magic Leap, a virtual reality (VR) startup that’s arguably had difficulty moving beyond its own hype. “Magic Leap will struggle to continue development with the likes of Alibaba not being able to supplement their earlier investment rounds. This is true of other US-based AR [augmented reality] and VR ventures that have received speculative investments from China,” explains Mr Mulligan. “However, money pumped into mixed reality companies are going to be subject to less US regulatory oversight than say investments in technology and telecoms infrastruc- ture or back-end providers.” You only have to look at the ban on US companies selling vital compo- nents to ZTE, China’s second-largest telecoms hardware provider, to realise this. Huawei is also banned in the United States. The numbers speak for themselves; in the first five months of 2018, overall Chinese investments in the US fell to their lowest level in seven years, a drop of 92 per cent, according to Rhodium Group. It doesn’t help that there’s been little or no return on investment from the nascent XR sector. “Chinese companies don’t look at foreign investments with a huge appetite; it’s often more a vanity investment than core to their strategy. Chinese tech companies are more obsessed with local developments because losing their domes- tic market share is a much bigger threat at this stage,” says Shann Biglione, head of strategy at Zenith USA and former head of business transformation at Publicis Media Greater China. Rhodium points out that the tight- ening of rules could have a chilling impact on Chinese inward investment into the US, including money moving into research and development, as well as other innovation-intensive activities. The trade spat has also led to a mad scramble in the tech sector before sanctions kick in. “Device-makers are aware of the tensions. Faced with the rising uncertainties, some vendors have already begun increasing their production and exports early to fulfil the expected increase in demand in the coming Q4 holiday season, as well as in early-2019,” says Jason Low, Shanghai-based senior analyst at Canalys. “The big issue is that China and its companies have to invest to stay ahead of the game domestically. XR is one of the top areas where the country has put in a lot of time and effort to create frameworks to streamline this development, as the industry requires key players from different areas, including hardware, network operators, content providers and developers, to work together.” In the past, China’s tech giants have looked for US startups, which help them learn about new tech and cutting-edge trends emanat- ing from Silicon Valley, as well as businesses that can complement their core e-commerce offerings at home. Their eyes are firmly on the main prize of making money out of China’s 900 million-plus, hyper-connected consumers. “There is enough growth to be had in China. By 2020 you will have 600 million middle-class consumers and companies will sell an extra $2.3 trillion of goods each year by that time,” says Tom Goodwin, head of innovation at Zenith Media. “At senior levels in Chinese corpo- rations, they’re adamant that they don’t need help when it comes to tech. I’ve seen this time and time again. From Huawei to Alibaba to China Mobile to DJI. They are very clear they ‘have tech covered’. It’s not arrogance; they just have total clarity on where their strengths lie, and they feel software and manufacturing are perfect for their skillsets.” It helps that there are five million science and technology graduates in China every year and their com- petence levels are extraordinarily high. They also have huge markets to experiment in. Asia accounts for 59 per cent of the global popula- tion. How consumers adopt XR here today could be crucial to how it’s rolled out worldwide tomorrow. Asia has the fastest-growing markets when it comes to disposable incomes. Consumers are crucially leap-frogging traditional ways of engagement when it comes to digital experiences. China also has a grand plan, con- cocted by Beijing’s apparatchiks, called Made in China 2025. It’s a concerted national effort to domi- nate high-tech industries globally, moving China up the value chain as labour costs grow. The leading Chinese tech companies are vast, but their Achilles’ heel is they conduct 90 per cent of their business within the country. Even so, such plans give Washington law-makers the jitters. By closing themselves off to China, America could lose out. Chinese companies will develop core technologies, including XR, whether they get help from Silicon Valley or not. They will also look elsewhere to invest and are likely to be welcomed with open arms. China is already active in many other countries and will increase this collaboration as it is increasingly frowned upon in the United States. “Don’t forget that the reliance on Chinese capital in Europe is far more evident than in the US,” says Nick Cooper, executive director and global head of insights at Landor Associates. “It is easy to overlook the fact that innovation is thriving in multiple locations around the world now. Not only on London’s own Silicon Roundabout and indeed Silicon Fen in Cambridge. This emphasises the UK’s lead in tech startups and investment within Europe. However, there are many other vibrant centres of tech excellence now, including Berlin, Stockholm and Helsinki, and elsewhere,suchasParisandAmsterdam.” In many ways, being shut out of the US could be a boon for China. It will be forced to be more self-reliant when it comes to the XR sector and other tech developments, which it will incu- bate, grow, exploit and then export. Watch out. NICK EASEN Tech is targ et in US-China sanctions battle Economic hostility and sanctions exchanged between the United States and China will impact development of reality technologies, with winners and losers on both sides of the trade war Market leaders in VR Revenue forecasts for the three largest virtual reality markets ($bn) PwC/Statista 2017 Chinese companies will develop core technologies, including XR, whether they get help from Silicon Valley or not 360-degree view of the Temple of Heaven in Beijing, China IdeaImagesviaGettyImages TRADE WAR 2016 2017 2018 2019 2020 2021 5 4 3 2 1 0 US China Japan Compound annual growth rate 47% 103% 65% Commercial feature F or the last few years, virtual reality in business has been much discussed, but less widely har- nessed. Today, far from being a notional advantage for the future, some of the world’s biggest companies are seeing the benefits for their training programmes. “Many industries from manufacturing and mining to healthcare, trans- port and energy, have moved beyond the tyre-kicking stage with VR training,” says Tom Symonds, founder and chief executive of VR training company Immerse.io, whose clients include Shell, DHL and GE Healthcare. “With large businesses already using the technology to help people train more effectively, it’s important for others to consider it so they are not left behind.” By using the company’s VR platform, up to ten people anywhere in the world can enter an immersive virtual environment and interact with one another, with additional people viewing a 2D version on their web browser. During or after the training, educators can comment on steps taken or guide participants. The technology is used across industries, from manufacturing processes to delivery firms, defence to flight, healthcare to mining, energy to communications and beyond. In addition to optimising broader business processes through analysis of the usage data, organisations can gain cost-savings within the delivery of training, simply because so much less travelling and ongoing investment is required thanks to the live and distributed nature of the platform. The sheer immersive nature of VR training enables learning experiences that VR is revolutionising the way businesses approach training Virtual reality holds huge promise for businesses, reducing the costs of training and dramatically improving results through immersive experiences impact learners on a deep level, driving improved knowledge retention. “Everyone learns best when they’re focused and even the most brilliant trainer cannot hold learners’ attention for 100 per cent of the time. There are so many distractions in a normal office environment that people’s minds nat- urally wander,” Mr Symonds explains. “But once learners are in a VR headset, being handed a virtual object by a col- league, they are fully focused as there is an immediate imperative to act and to interact.” For industries such as oil and gas, where safety issues are of utmost importance, the capacity for VR training to avoid potentially dangerous out- comes is critical. Energy giant Shell is using the systems to train for emer- gency response. “We can show a person the impact of a delay in shutting down a defec- tive piece of equipment by a few sec- onds. This ability to recreate different working scenarios means learners understand and experience the conse- quences of one decision over another. They wouldn’t forget this training in a hurry,” says Mr Symonds. “That offers real value for businesses where main- taining the highest levels of worker safety is paramount.” Immerse.io’s VR platform is under- pinned by training data capture on a large scale, empowering live or post-session assessment. Managers can see how well trainees have per- formed in a given VR scenario and they are able then to pinpoint where improvements can be made. The technology company’s in-house developers work closely with clients to create bespoke VR training environments, but Mr Symonds says businesses also use his company’s platform independently to create their own per- sonalised environments. “We’ve created a software development kit that allows our clients to create their own content or to import CAD [computer-aided design] models to run on the platform,” he says. “This means companies can quickly and repeatedly build the virtual environments they need, enabling them to take enterprise-wide training to the next level and deliver massive change in their organisation.” To find out more about providing accessible, immersive VR training across your business please visit immerse.io With large businesses already using the technology to help people train more effectively, it’s important for others to consider it so they are not left behind Two trainees work together in a collaborative virtual space to identify and prevent a gas leak

11. 10 RACONTEUR.NET 11XR FOR BUSINESS T he ongoing trade spat between Washington and Beijing certainly makes headline news, but behind the ruffling of feathers over steel pipes, wine and pork, there’s a much bigger agenda. “What they are fight- ing is not really a trade war, it’s a tech war. A tech war is also a manufacturing war,” according to Terry Gou, chairman of Foxconn. The Taiwanese electronics company should know; it employs more than a million workers, many in mainland China, and is a big sup- plier to Apple. These tensions have profound implications for the extended reality (XR) industries. Chinese investment in US tech firms has officially been soured as the Trump administration gets spikey over alleged intellectual property theft and unfair trade practices. “Both the US and China see themselves as having a manifest destiny to determine world affairs, and perceive their economic and cultural outputs as crucial to shaping how the 21st century plays out globally,” says Tim Mulligan, senior analyst at MIDiA Research. “Technological innovation is a crucial strand in establishing global leadership.” Alibaba, JD and Tencent are among the Chinese tech giants that have made big investments in America. Alibaba is of note having lavished hundreds of millions of dollars on ultra-secretive Magic Leap, a virtual reality (VR) startup that’s arguably had difficulty moving beyond its own hype. “Magic Leap will struggle to continue development with the likes of Alibaba not being able to supplement their earlier investment rounds. This is true of other US-based AR [augmented reality] and VR ventures that have received speculative investments from China,” explains Mr Mulligan. “However, money pumped into mixed reality companies are going to be subject to less US regulatory oversight than say investments in technology and telecoms infrastruc- ture or back-end providers.” You only have to look at the ban on US companies selling vital compo- nents to ZTE, China’s second-largest telecoms hardware provider, to realise this. Huawei is also banned in the United States. The numbers speak for themselves; in the first five months of 2018, overall Chinese investments in the US fell to their lowest level in seven years, a drop of 92 per cent, according to Rhodium Group. It doesn’t help that there’s been little or no return on investment from the nascent XR sector. “Chinese companies don’t look at foreign investments with a huge appetite; it’s often more a vanity investment than core to their strategy. Chinese tech companies are more obsessed with local developments because losing their domes- tic market share is a much bigger threat at this stage,” says Shann Biglione, head of strategy at Zenith USA and former head of business transformation at Publicis Media Greater China. Rhodium points out that the tight- ening of rules could have a chilling impact on Chinese inward investment into the US, including money moving into research and development, as well as other innovation-intensive activities. The trade spat has also led to a mad scramble in the tech sector before sanctions kick in. “Device-makers are aware of the tensions. Faced with the rising uncertainties, some vendors have already begun increasing their production and exports early to fulfil the expected increase in demand in the coming Q4 holiday season, as well as in early-2019,” says Jason Low, Shanghai-based senior analyst at Canalys. “The big issue is that China and its companies have to invest to stay ahead of the game domestically. XR is one of the top areas where the country has put in a lot of time and effort to create frameworks to streamline this development, as the industry requires key players from different areas, including hardware, network operators, content providers and developers, to work together.” In the past, China’s tech giants have looked for US startups, which help them learn about new tech and cutting-edge trends emanat- ing from Silicon Valley, as well as businesses that can complement their core e-commerce offerings at home. Their eyes are firmly on the main prize of making money out of China’s 900 million-plus, hyper-connected consumers. “There is enough growth to be had in China. By 2020 you will have 600 million middle-class consumers and companies will sell an extra $2.3 trillion of goods each year by that time,” says Tom Goodwin, head of innovation at Zenith Media. “At senior levels in Chinese corpo- rations, they’re adamant that they don’t need help when it comes to tech. I’ve seen this time and time again. From Huawei to Alibaba to China Mobile to DJI. They are very clear they ‘have tech covered’. It’s not arrogance; they just have total clarity on where their strengths lie, and they feel software and manufacturing are perfect for their skillsets.” It helps that there are five million science and technology graduates in China every year and their com- petence levels are extraordinarily high. They also have huge markets to experiment in. Asia accounts for 59 per cent of the global popula- tion. How consumers adopt XR here today could be crucial to how it’s rolled out worldwide tomorrow. Asia has the fastest-growing markets when it comes to disposable incomes. Consumers are crucially leap-frogging traditional ways of engagement when it comes to digital experiences. China also has a grand plan, con- cocted by Beijing’s apparatchiks, called Made in China 2025. It’s a concerted national effort to domi- nate high-tech industries globally, moving China up the value chain as labour costs grow. The leading Chinese tech companies are vast, but their Achilles’ heel is they conduct 90 per cent of their business within the country. Even so, such plans give Washington law-makers the jitters. By closing themselves off to China, America could lose out. Chinese companies will develop core technologies, including XR, whether they get help from Silicon Valley or not. They will also look elsewhere to invest and are likely to be welcomed with open arms. China is already active in many other countries and will increase this collaboration as it is increasingly frowned upon in the United States. “Don’t forget that the reliance on Chinese capital in Europe is far more evident than in the US,” says Nick Cooper, executive director and global head of insights at Landor Associates. “It is easy to overlook the fact that innovation is thriving in multiple locations around the world now. Not only on London’s own Silicon Roundabout and indeed Silicon Fen in Cambridge. This emphasises the UK’s lead in tech startups and investment within Europe. However, there are many other vibrant centres of tech excellence now, including Berlin, Stockholm and Helsinki, and elsewhere,suchasParisandAmsterdam.” In many ways, being shut out of the US could be a boon for China. It will be forced to be more self-reliant when it comes to the XR sector and other tech developments, which it will incu- bate, grow, exploit and then export. Watch out. NICK EASEN Tech is targ et in US-China sanctions battle Economic hostility and sanctions exchanged between the United States and China will impact development of reality technologies, with winners and losers on both sides of the trade war Market leaders in VR Revenue forecasts for the three largest virtual reality markets ($bn) PwC/Statista 2017 Chinese companies will develop core technologies, including XR, whether they get help from Silicon Valley or not 360-degree view of the Temple of Heaven in Beijing, China IdeaImagesviaGettyImages TRADE WAR 2016 2017 2018 2019 2020 2021 5 4 3 2 1 0 US China Japan Compound annual growth rate 47% 103% 65% Commercial feature F or the last few years, virtual reality in business has been much discussed, but less widely har- nessed. Today, far from being a notional advantage for the future, some of the world’s biggest companies are seeing the benefits for their training programmes. “Many industries from manufacturing and mining to healthcare, trans- port and energy, have moved beyond the tyre-kicking stage with VR training,” says Tom Symonds, founder and chief executive of VR training company Immerse.io, whose clients include Shell, DHL and GE Healthcare. “With large businesses already using the technology to help people train more effectively, it’s important for others to consider it so they are not left behind.” By using the company’s VR platform, up to ten people anywhere in the world can enter an immersive virtual environment and interact with one another, with additional people viewing a 2D version on their web browser. During or after the training, educators can comment on steps taken or guide participants. The technology is used across industries, from manufacturing processes to delivery firms, defence to flight, healthcare to mining, energy to communications and beyond. In addition to optimising broader business processes through analysis of the usage data, organisations can gain cost-savings within the delivery of training, simply because so much less travelling and ongoing investment is required thanks to the live and distributed nature of the platform. The sheer immersive nature of VR training enables learning experiences that VR is revolutionising the way businesses approach training Virtual reality holds huge promise for businesses, reducing the costs of training and dramatically improving results through immersive experiences impact learners on a deep level, driving improved knowledge retention. “Everyone learns best when they’re focused and even the most brilliant trainer cannot hold learners’ attention for 100 per cent of the time. There are so many distractions in a normal office environment that people’s minds nat- urally wander,” Mr Symonds explains. “But once learners are in a VR headset, being handed a virtual object by a col- league, they are fully focused as there is an immediate imperative to act and to interact.” For industries such as oil and gas, where safety issues are of utmost importance, the capacity for VR training to avoid potentially dangerous out- comes is critical. Energy giant Shell is using the systems to train for emer- gency response. “We can show a person the impact of a delay in shutting down a defec- tive piece of equipment by a few sec- onds. This ability to recreate different working scenarios means learners understand and experience the conse- quences of one decision over another. They wouldn’t forget this training in a hurry,” says Mr Symonds. “That offers real value for businesses where main- taining the highest levels of worker safety is paramount.” Immerse.io’s VR platform is under- pinned by training data capture on a large scale, empowering live or post-session assessment. Managers can see how well trainees have per- formed in a given VR scenario and they are able then to pinpoint where improvements can be made. The technology company’s in-house developers work closely with clients to create bespoke VR training environments, but Mr Symonds says businesses also use his company’s platform independently to create their own per- sonalised environments. “We’ve created a software development kit that allows our clients to create their own content or to import CAD [computer-aided design] models to run on the platform,” he says. “This means companies can quickly and repeatedly build the virtual environments they need, enabling them to take enterprise-wide training to the next level and deliver massive change in their organisation.” To find out more about providing accessible, immersive VR training across your business please visit immerse.io With large businesses already using the technology to help people train more effectively, it’s important for others to consider it so they are not left behind Two trainees work together in a collaborative virtual space to identify and prevent a gas leak

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