Addressing Major AR/VR Industry Challenges

In 2016, the Perkins Coie and Upload legal firms published research showing the key stumbling blocks for AR/VR. Over 650 startup founders, executives with established technology companies and investors were polled.

When asked about the greatest challenge facing AR/VR, 37% named a lack of compelling content. After that came public unwillingness to embrace the technology (23%) and technical limitations (20%). 5% thought about lack of financing, 4% — legal risks, and 2% — mobile device producers’ reluctance to implement AR/VR. Below we shall address the main challenges and try to find a solution.

Lack of compelling content

On first trying out a VR headset, the user experiences new and therefore strong emotions. But later he gets used to it, seeing the same (or very similar) content every time. The virtual world’s content offerings are quite scarce, causing interest in such devices to slowly subside after initial enthusiasm. One of the survey participants suggested that Nintendo and Sega consoles became popular only because they were sold with numerous games for everyone’s tastes. That is exactly what VR developers should do. Of course, it is not only a matter for VR games; the whole industry is affected.

Content creation is a time-consuming process, and pricing is exorbitant for mass users. The choice at the Oculus and HTC Vive stores is limited, and its added value is still quite low. Luckily, infrastructure tools are gaining momentum. Smartphones’ high resolution displays and mobile 3D graphic processors are suitable for AR/VR mass introduction. Emerging platforms like Apple ARKit and Google ARCore are expected to ensure easier and cheaper creation of VR/AR content. But even these initiatives can not help solve all the problems.

AR/VR content should keep up this pace as it is expected to spur the expansion of AR/VR technology.

Incompatibility issues

Of course, developers and manufacturers are anxious to play a role in AR/VR expansion. Everyone wants to get in the game early and optimize their market share. This competitive landscape creates problems. Lack of content eventually leads to the problem of distribution. Hardly any company wants to invest in VR apps to find that it only works on one of many possible devices. Many companies, and not just content creators, name their biggest obstacle to doing VR as having to choose which piece of hardware to distribute on.

Different VR hardware and software are not compatible, and the content formats can’t always be converted into others. This variety causes confusion among consumers. Without a proven leader in the industry, no one knows where the content will land. Consumers and developers alike are unwilling to commit to any one particular brand until they know it’s a winner.

As for 3D content, the creators are almost always limited by a specific platform restrictions.

Marketplace dictatorship

Another big problem is that in order to have an AR/VR experience, the content has to come from somewhere. In some cases, that doesn’t matter, because it is automatically generated. For example, looking through a pair of AR glasses one can see street names superimposed on the real view of a city. And it would be simple to arrange for a person’s name to appear on their forehead as the result of facial recognition.

However, the situation is much less easy for applications and devices not intended to use UI content. If the developers need ready-made 3D content, they need a reliable source of it. Nowadays most 3D content marketplaces worry more about their business KPI than community development. Royalty rates at these websites are rarely above 60%, sometimes sliding down to 30%. A 70% rate is possible on some platforms, but only for exceptional content.

On top of that, content makers are forced to take care of promoting their work themselves, as voting systems are underdeveloped and users are not encouraged to rank the content. The existing infrastructure is not friendly to content buyers either, as they can’t test models before purchase or check their compatibility with development tools or apps.

Legal issues: copyright

The boost of AR/VR has not only caught the attention of consumers and those working in the industry, but also that of legislators and regulators. As more and more companies develop and exploit this technology, they face lots of legal issues, perhaps most significantly in relation to the copyright challenges associated with exploitation of AR/VR technology and content.

Because so much of what makes AR/VR compelling is its ability to display creative text and images in new ways, the potential for copyright issues is obvious. It is indeed a challenging task to prevent the unauthorized use of 3D content. One can’t protect it by using watermarks the way it is done with 2D images. So far the whole system of protection is based only on user reports, and, therefore, not very effective.

As well as being mindful of having permissions to use copyright-protected content, it will be important to ensure that any original content created for a certain app or device is properly protected. One of the main risk areas is piracy. This is currently a big issue in the gaming and film industries so is likely to be important in AR/VR too. Today a lot of piracy in gaming is curbed with technological protection measures (TPMs). These prevent pirated games from running on gaming consoles. This kind of technology could be used in AR/VR to help combat piracy issues by tying AR/VR content to specific devices. There are, however, limits on the use of TPMs.

Cool reception in the market

Although AR/VR has recently showed unrivaled progress, it is still regarded as merely an entertainment trick by most business leaders. They are evidently unwilling to invest in technologies that may not pay off in any other industry. The WOW effect produced by AR/VR in games and movies for now makes people believe that the technology can’t be used in any other way.

However, AR/VR can and already is used in education, medicine, retail, and production, though these cases are few because the process of AR/VR technology implementation is still expensive and time-consuming.

Cappasity offers a way out

Cappasity platform is designed to overcome the above-mentioned obstacles, tackling not just one, but all of them at once. The Cappasity founders have extensive experience in 3D technologies and digital marketing, so they have meticulously studied the key factors that bring success or impede the development of AR/VR initiatives. Therefore, Cappasity intends to create an ecosystem for seamless 3D content production and exchange in a convenient and profitable way for both content makers and consumers. The ecosystem economic model is based on ARToken cryptocurrency.

Cappasity offers a solution to the problem of choosing platforms and formats by providing outstanding embedding opportunities. From now on developers can stop worrying that some content will not be compatible with the system. All content on the Cappasity marketplace can be deployed in the Sandbox area before purchase. The Sandbox has a built-in viewer for content as well as tools to test AR/VR/3D content in practice. This in particular will be of great value for developers wishing to see how content behaves when run on different devices.

Furthermore, Cappasity will enable developers to embed different types of content, automatically optimizing them for the target device. We plan to introduce API to solve data import issues, including an interface for creating a load module for any 3D data format.

Blockchain technology, thanks to its decentralized nature, offers an exchange of 3D content with smallest commission fees and provides copyright protection. To prevent the infringement of copyrights the hashes of all files on the Cappasity platform are listed in blockchain and cannot be altered. On top of that, we will grant consumers two types of licenses: the first only for commercial use with access to the file via link, and the second granting rights for extended use with direct access to the file. All this is projected to solve the problem of usage control.

As for the market players slow in accepting and understanding the vast array of opportunities for AR/VR, Cappasity has so far successfully demonstrated its implementation in retail (3D images in online stores increasing conversion rate) and fashion (new collections in 3D format).

To move forward, AR/VR technology should face and solve rising tensions. Cappasity offers a groundbreaking tool to combat a bundle of issues simultaneously, and that will be not a step forward, but a leap.