Digi-Capital has published an interesting blog that suggests that there will be an ‘epic battle’ between Facebook, Apple, Google, Tencent, Snap, Alibaba, Baidu, Samsung, Huawei and more after Mark Zuckerberg’s comment in April that “We’re making the camera the first augmented reality platform.” Digi-Capital believes that the market will grow over a billion users with a value of $60 billion by 2021 and that Facebook’s moves to establish a mobile AR platform are more important than the Apple iPhone AR platform, which has now been launched at the Developers’ conference.
The company has been saying for the last two years Apple is the best placed tech company to drive AR, and an iPhone AR has been part of its mobile AR forecasts since late last year. It anticipates Samsung, Huawei and others launching their own AR-enabled smartphones (using Google Tango or something proprietary). With phone replacement cycles at 2½ years and high-end phones anywhere between 1/3 and 2/3 of smartphone sales (depending on manufacturer and geography), range-topping AR phones could deliver an installed base of at first tens and then hundreds of millions in a few short years.
Digi-Capital believes that mobile AR could become the dominant AR/VR market for the foreseeable future, as it solves the five major consumer challenges for AR (hero device, all-day battery life, mobile connectivity, app ecosystem, telco cross-subsidisation). Together with backing from major global consumer platforms like Facebook, the inflection point for AR/VR might be within sight.
Mark Zuckerberg is right, the company said, but it isn’t just the camera. The phone is the first (software) and second (hardware) augmented reality platform. “And that’s a one-two punch you either get to throw or get knocked out by”.
Analyst Comment
The blog is worth a read. There have been lots of words about the Apple platform for AR. Apple could spend some time building an ecosystem and platform. Once that is viable, the technology to deliver good looking lightweight Apple glasses might just be the ‘cherry on the cake’, even if the majority of users are making the most of their existing smartphones. (BR)
