Will AR/VR eventually become new general purpose technology?
All the noise about AR/VR technologies is deafening. But will they go beyond the hype and truly change our lives on a grand scale? Will any of them become a general purpose technology (GPT)? A general purpose technology or GPT is a term coined to describe a new method of producing and inventing that is important enough to have a protracted aggregate impact. They transform both everyday life and the ways in which firms conduct business.
New technologies sprout in our world and gradually find their niche. They help business and studies, improve the entertainment industry, and introduce a new source of information or method of communication. Today we are witnessing parallel development of two important technologies — augmented and virtual reality. They share much in common but have significant differences as well. Each technology has its benefits and evolves at its own speed. Perhaps one day AR/VR will become another digital platform, pushing smartphones to the side, as they once did to PCs.
According to Bresnahan and Trajtenberg, GPTs also have three fundamental features or characteristics:
- GPTs are pervasive and spread to most sectors;
- GPTs improve over time and should keep lowering the costs for its user;
- GPTs spawn innovation making it easier to invent and produce new products or processes.
Are AR/VR technologies pervasive? There are no doubts here. The technologies are implemented in a vast array of industries: healthcare, construction and architecture, engineering, education, entertainment, sport, tourism and fashion. Do they improve over time? Well, we can see it with our own eyes: AR/VR is developing at an extraordinary rate. AR/VR-based tools have also already spawned a vast array of new cutting-edge initiatives.
Any GPT passes through four stages: the idea, demo, successful project, and mass product stages. AR/VR are currently somewhere between the second and third stages: we have seen lots of demos and a few successful projects. The industry still cannot yet offer mass commercial products, but it’s well on its way. AR/VR have recently started producing effects on the general public, inter alias, due to the so-called 4th platform development.
Every day, augmented and virtual reality conquers another bit of the real world, evolving into a ground-breaking initiative. In 2016 a number of IT giants produced VR headsets: Google, Oculus, Samsung, Sony, HTC, Microsoft. Investors from around the world readily invest huge amounts into the industry, and AR/VR tools and equipment are becoming numerous while virtual reality is becoming cheaper and more realistic. Analysts expect AR/VR market to reach $150 bn by 2020, while AR will account for $120 bn.
The world is anticipating something new and innovative to take the place of the current dominant technology (smartphones), and producers and developers are trying to persuade customers that they are the standard bearer of this new era. Time will tell who the winner is.