What is augmented reality?

What is augmented reality?

The term augmented reality (AR) was first coined in the 1990s by Tom Caudell, a researcher for aircraft manufacturer Boeing, to describe a digital display viewed through a headset which guided workers through electrical wires in an aircraft.


Since then the term has been far more broadly applied to describe digital information overlaid in the physical world.

According to research firm MarketsandMarkets, the augmented reality product market is split into five broad categories: smartphones, tablet PCs, eye wear, head mounted displays and heads up displays.

From these devices the technology is utilised in both the industrial and consumer markets.

Some of the largest industrial applications come in the military, automobile, medical, manufacturing and repair industries. Consumer applications include gaming, e-learning, GPS navigation and advertising.

One of the most recent examples of an AR device is Google’s Glass project, a pair of glasses fitted with a digital display to show the wearer information over the eye.

What are the AR applications for telecoms companies?

One of the most prominent aspects of augmented reality being eyed by telecoms companies is the combination of live video with computer generated data and virtualisations, particularly for use in advertising.

There are already mobile applications in the market which utilise geotagging technology to access web information about a user’s location.

For augmented reality to work on a mobile device it requires a camera, GPS and digital compass, broadband connectivity and an accelerometer, according to Juniper Research. Due to these limitations, augmented reality only became practical after 2009 with the development of higher end mobile handsets.

Augmented reality applications and browsers use layers of metadata about physical objects geotagged by developers of the application/browser, or even members of the public in the case of open solutions.

GPS is then used to recognise where the user is and the digital compass recognises his or her direction. From these two measurements it is determined what geotagged objects will be displayed through the camera viewfinder.

Objects are tagged using either a 2D barcode or through image recognition. Juniper says that in both cases the application or browser searches for a tracked object then tracks it upon locating it, attaching a digital overlay.

Which carriers are embracing AR technology?

Telefónica is one of the most recent carriers to back AR technology. The company is collaborating with AR platform Aurasma to integrate the technology into its media offering.

This will enable brands to benefit from augmented reality as part of their marketing campaigns. The deal is one of the biggest of its kind in the augmented reality space with the potential to reach 25 markets and 300 million customers.

Telefónica is hoping to utilise applications in interactive digital content like videos, coupons, competitions and 3D animations, unlocking them on various types of media, including billboards, print adverts, products, physical locations and in-store materials.

The carrier will look to distribute Aurasma’s app through its mobile customer base and implement augmented reality in its own marketing campaigns. An initial roll-out of the partnership will begin in the UK, followed by other markets.

Device manufacturers and OTT players are also exploring the applications of augmented reality technology. Nokia recently demonstrated its City Lens, an AR application allowing users to get more information about a location by pointing their phone’s camera at it. Google is also investing in its own AR project and exploring functionality with its Google Maps platform.

What is the size and potential of the AR market?

According to a report released in November 2011 by MarketsandMarkets, only 0.1% of users worldwide were found to be using AR products.

MarketsandMarkets estimates that this number will increase to 1% of the population in the next five years, a dramatic rise. As the number of users increases more and more, applications are expected to incorporate AR features, particularly in the retail, travel and gaming sectors.

Right now Europe and North America are the main contributors to the augmented reality application market, according to MarketsandMarkets, but this is expected to change in the next five years with Japan, China and South Korea expected to account for a large portion of the global market share.

It is thought this growth will drive the AR application market from smaller companies and developers to increased involvement from established industry players.

MarketsandMarkets estimates that the AR market will grow exponentially from $181.25 million in 2011 to $5,155.92 million by 2016 at a CAGR of 95.35%. Smartphones are expected to be the most attractive segment followed by tablets.

Meanwhile Semico Research Corporation estimates that 864 million high-end mobile phones will be AR-enabled in 2014 and 103 million automobiles will contain AR technology by 2020.

The research firm also has an even more positive forecast for growth, estimating that the AR market will be worth $600 billion by 2016.

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