Enterprise AR will dominate over consumer apps

Consumer app revenues from augmented reality (AR) will remain below that of the enterprise sector through to 2021, a new Juniper Research study has found.

In spite of games like Pokémon GO dominating the public consciousness of AR, Juniper forecasts that revenues from enterprise AR apps will reach $5.7 billion by 2021, rising from an estimated $515 million in 2016. 

The research found that enterprise interest in AR technologies has continued to grow, fuelled by improvements in field of vision and latency on head mounted displays (HMDs). Future releases of these units, such as Microsoft HoloLens, are set to drive AR content revenues in the enterprise sector as businesses opt for HMDs over smartphones and tablets.

According to the new study, Augmented Reality: Developer & Vendor Strategies 2016-2021, the bespoke nature of content in the enterprise AR sector (such as DAQRI’s partnerships with Hyperloop and Siemens), will lead to higher app prices. The combination of higher content pricing and hardware will initially lead to slow adoption and only the earliest tech-adopters in the enterprise space will implement the technology over the next 2 years.

The report finds that enterprise AR revenues are set to remain on smartphone and tablet devices for the foreseeable future. However, enterprise focus from manufacturers such as Microsoft and Vuzix will see the largest revenue opportunity for content developers on HMDs from 2020.

While the ubiquity of smartphones will give an immediate audience and distribution channel, the report advises developers to focus on continued innovation in order to keep users engaged.

Juniper Research senior analyst and study author Sam Barker said: “The nostalgia of Pokémon has worn off for most users and there are reports about a drop in app usage. This means that the majority of consumer applications will only have limited revenue opportunity and are likely to have a short shelf-life akin to the current wider app ecosystem”.

He also added that the high cost of HMDs and consumer hesitancy around public usage will deter consumers from purchasing AR glasses in the short-term.

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