Consumer AR needs 5G (and cheaper headsets) to really take off

Augmented reality (AR) has come a long way from the early days of Google Glass and Pokemon Go. AR is fast gaining traction in various enterprise segments, especially in China, where it is already being used for everything from video production to installing base stations. But the real boost for AR will come from the consumer market – provided device prices come down far enough, and provided operators harness the combined power of 5G, cloud, edge, and AI to provide the best user experience for AR.

That was the overall theme of the Huawei Better World Summit for 5G + AR, held online on June 17, where a variety of speakers shared their views on where AR is today, where it’s going, and what needs to happen in the meantime.

Up to now, AR has been mainly an enterprise play. For example, Bob Cai, CMO of Huawei’s Carrier BG, talked about how the vendor has already found in-house uses for AR during the COVID-19 pandemic, such as showcasing products to clients virtually, and speeding up base station rollouts by providing AR info to field engineers to eliminate multiple site visits. Huang He, chief producer of Shenzhen TV Station, demonstrated how his company is using AR to create overlay graphics, virtual environments and even virtual hosts for live television events.

That said, the consumer AR market hasn’t been languishing. David MacQueen, executive director of Strategy Analytics, noted that AR is already resonating with consumers with hits such as Pokémon Go, Snapchat and TikTok, driving heavy usage across a huge market of 1.5 billion devices that includes both AR headsets like Microsoft’s HoloLens and AR-enabled smartphones and tablets.

However, MacQueen said, consumer AR will really take off once standalone AR headsets are light, comfortable and cheap enough. A HoloLens headset weighs half a kilo and costs $3,500. By contrast, a lightweight pair of glasses tethered to a smartphone would have all the processing power it needs, at a price point of around $600.

MacQueen said the first announcements for such headsets are slated for Q4 this year and well into 2022: “This will drive the market to over 53 million AR headset shipments in 2026 which in turn, will create a consumer installed base of over 91 million users.”

But it will take more than affordable lightweight AR headsets for consumer AR to take off, he added: “They will need to be supported by a good quality, 5G network.”

And that doesn’t just mean superfast connections to the base station – it also means leveraging other key features of 5G infrastructure. For example, the cloud can be used to offload processing power and graphics rendering (otherwise an AR headset will drain a smartphone battery in no time). Mobile edge computing will help improve latency, and AI (also in the cloud) can interpret live video coming in and contextualize data. All of this is necessary for AR to deliver the best possible user experience, MacQueen said.

This also means AR is a juicy opportunity for 5G operators, MacQueen said, as consumer AR is inherently a mobile play.

Case in point: South Korean operator LG U+, which put AR at the center of its 5G marketing strategy. LG U+ struck partnerships with AR hardware vendor Nreal as well as apps developers and content creators to create an AR ecosystem, and then bundled the resulting AR services with its 5G smartphones. Result: a 12% increase in service revenues directly attributable to its AR offerings.

Eric Zhao, vice president of Huawei’s CNBG Marketing, said that the experience of LG U+ shows that a robust 5G network is crucial for developing valuable AR services.

“To lay the solid foundation for 5G + AR development, we must first facilitate the deployment of 5G networks,” Zhao said during a media briefing after the summit. “Also, because most of the AR devices in the market will become lighter, users will enjoy them on the go. So operators must develop their capabilities to combine 5G, AR and cloud to provide them with the ultimate experience.”

Zhao added it was critical to develop an AR ecosystem of partners developing devices, networks and content. “By deepening cooperation between these three parties, we can lower the barrier to market access to the AR industry, and we can encourage the implementation and adoption of AR.” Disruptive.Asia