There was much hope in the mid-2010s that virtual reality would take off and become the next big thing in home entertainment. Many brands invested in VR headsets that would connect to PCs and game consoles to take users seamlessly from a 2D environment to an immersive 3D world. While enthusiasts may have jumped on the bandwagon quickly, many consumers have yet to invest in the ever-widening technology, much to the chagrin of Meta (formerly Facebook) CEO Mark Zuckerberg and his burgeoning metaverse.
The concept of VR has not gone away and has gradually morphed into augmented reality (XR) via further upgrades as we move into the mid-2020s. The hardware has become smaller, lighter and wireless. Companies including Meta and Apple are marketing their XR headsets, the Meta Quest 3 and Apple Vision Pro respectively, as entertainment devices with several built-in business features. But other companies take a different approach.
Lenovo’s vision of XR
After years of the industry trying to make VR/XR an entertainment-first medium, Lenovo has considered the enterprise space as the most direct route to give users their first headset experience. I spoke with Jason McGuigan, Lenovo’s head of commercial VR, during the brand’s Tech World 2023 conference about how their collaboration with companies allows prospective consumers to try the XR before they buy.
Despite various headsets being available for about a decade, McGuigan estimated that between 50% and 60% of the market hasn’t tried the XR in any capacity. Companies like Chick-fil-A, Walmart or a call center can use VR to train their new employees, and it may be the first time they come into contact with a headset.
He noted that having first-hand XR experiences at work demystifies many of the questions people may have about how the technology works without any initial investment on their part. Many expect more from a flat screen in front of their face when they put on a headset, or a 3D TV experience.
“The immersion surprises everyone. The connection they have to the content surprises everyone. Then they become a fan of it. We’ve had a lot of people tell us that they started using their headset at work and then they got too personal at home. We will see a lot of that translation for the consumer market, but we’ll see that growth as we see more and more content develop. It’s going to be ultra-specific for everybody,” McGuigan said.
The wavering of immediate consumer interest has been a win for the enterprise space. Many organizations have invested in XR as a time-saving and cost-saving mechanism. They can use headsets for multiple purposes, from staff training to remote collaboration in VR. Some organizations are developing even more use cases as newer generative AI technologies become available.
AI and XR unite
Over the past decade, companies have been able to rationalize the cost metrics of investing in XR far more than any individual consumer can. If a consumer-marketed XR headset is available, it’s open to a lot more scrutiny of its size, design, comfort level, and whether the device is worth its price tag, even for enthusiasts. At the same time, employees don’t have much choice about or how a headset is used in the corporate space. Aspects such as maximum comfort may be overlooked in favor of cost savings for a company as devices are unlikely to be used for an extended period in a work environment. These are things that businesses can easily calculate the benefits of in terms of time, money and cost, McGuigan noted.
“With early technologies, the investment is heavy. The company has more to invest because they have more to gain. If I’m an individual gamer and I buy a VR headset, I get the satisfaction of my one use. No matter what I use it for, how often I use it, I have to build that gauge. This is how much I spent on it and this is what I get out of it. Does it meet my entertainment quotient for what I spent on it? I spent $500, when get I return my $500 in return on investment for my personal satisfaction?” he said.
Like the hardware, XR requires compatible software and services that are currently much more lucrative in the enterprise space than for consumers. With the modern advent of generative AI, many companies, including Lenovo, are using the technology to create powered solutions for many different industries.
It enables different companies to quickly develop their own solutions that only require a login for access. Projects that required six months to complete have been truncated to six weeks, allowing time to consider additional use cases. This brings challenges, such as what happens when technology is updated while a company is rolling out a project. However, the collaboration between XR and generative AI in the enterprise space has the potential to point to growth for the industry, driving Lenovo’s business as a whole.
“Everyone in the company building their own content that has a high cost level and the same cost reduction will (apply to) traditional game developers, traditional XR developers and consumer developers“, McGuigan said. “Someone who made a traditional video game last year without any of these tools, might have to hire outside resources for voice talent. Maybe they had programming needs. Maybe they were a decent programmer, but a great artist; maybe they are a great artist, but a terrible programmer. All of these things can be unlocked by using generative AI, and now they can create games, XR applications, everything that can then be translated to the end user.”
A not so distant future
As generative AI becomes more ubiquitous in the enterprise space, the benefits to the consumer XR space will likely become more apparent. A wealth of content created by generative AI will likely usher in the compact XR devices that will be most appealing to consumers for home and entertainment purposes.
McGuigan notes that the XR headset has had a similar trajectory to the TV and the portable phone, which began as large, bulky devices with few features. But as they got extra content and faster ways to produce the content, they became smaller and more efficient.
“We’re not millennia away from that. We’re maybe 10 years before something becomes super easy and light, but when it becomes that simple, it’s going to be the best way to experience it. Because if we all sit in our homes and talk, we put put on a pair of glasses and it looks like you’re sitting there. We’ll do that instead of just picking up the phone because it’s going to be a much more interactive, fun and enjoyable experience,” McGuigan said.
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