ISTM #21: AWE From Irrational Exuberance to Clean & Sober

AWE

I recently attended the 10th annual Augmented World Expo (AWE) at the Santa Clara Convention Center in Silicon Valley. With 7,000 attendees— up almost 25 percent from last year— over 350 speakers and 250 booth exhibits, it was by far the biggest event ever for the Immersive Technology community.

While I should feel impressed by these numbers, I have to admit that just a few short years ago, I believed that by now AWE would be filling Moscone Center and contemplating a move to Vegas, where earlier this year, CES hosted 182,000 visitors to 4,400 exhibits and 2,000 speakers.

I formed these views during a period that now seems to have been filled with irrational exuberance. I had envisioned that by now, many of us would be walking around with fashionable $299 headsets that looked pretty much like a pair of Warby Parkers. I predicted such things in a book written during a period of irrational exuberance in the Spatial Computing community.

AWE #10 got me to see that this talented and innovative community has entered a new period of clean and sober. This does not make for exciting writing, but it does generate the likelihood that Immersive Technology is indeed a sustainable, scalable industry that will change the relationship between digital technology and humankind a great deal.

I went to AWE to measure the pulse of the industry and my executive summary is that there is a clear and steady pulse. The fever has subsided, and previously discounted barriers remain formidable, although they are being steadily chipped away.

Sports Jackets Up & Tee-Shirts Down

This wasn’t just a bigger crowd than previously; it was a far more businesslike crowd: There was more gray hair this year and less pink. More people wore business apparel than tee-shirts. The ancient ritual of exchanging business cards seems to have been rejuvenated.

It was a professionally run event as well. AWE’s producers made the event a tightly run operation where everything worked as it should. Presentations started and ended as scheduled and slides and sounds were presented consistently without a glitch. It wasn’t all formality: There was an Immersive Playground, filled with games and entertainment and, of course, AWE is wonderful for social networking.

This was a B2B show, and one where it seemed to me, there were many more sellers than buyers and there were more startups looking for funding than there were VCs looking to fund.

There were very few new companies or technologies that blew me away—I’ll discuss them shortly— but there was a large number of exhibitors who were showing significantly refined products, particularly AR headsets.

I saw nothing significant targeting consumers, and the products that I thought might eventually be aimed at consumers were being positioned for enterprise applications. Very few people were talking about cool stuff for affluent consumers but were discussing supply chain efficiencies, industrial training and automated processes.

This is as it should be in the evolution of this nascent industry. Prices and technological bottlenecks will not stop an enterprise from trying something new to measure performance, cost savings, safety improvements and so on. Enterprise is not just the low-hanging fruit for Spatial Computing right now, it’s almost the only fruit in the orchard.

4 Companies I Liked

Mostly, I skimmed at AWE, spending 10-or-15 minutes in a presentation, then moving on to the next. So, I present to you my five favorite companies based on a somewhat ad hoc and brief look. I hope to revisit each of these companies in the next few months.

Looking Glass Factory. This was my favorite: it was the only product that was absolutely unique—at least to me. Essentially, the New York City startup makes 3D holographic boxes for displays on tables, store shelves or anywhere you please. You don’t need a headset, which is one of the big pluses. If you invest in their accessory kit you get LeapMotion, the dazzling hand-tracking technology. The company representative talked to me about retail displays, education, entertainment and even patient care. The standard size has been around for at least a year and now costs $599, making it suitable for some consumers who can buy it at their site. The new panoramic version is currently for developers and is priced accordingly at $3,000. I am arranging an interview with the CEO to learn more for a future ISTM issue.

Varjo XR-1. XR is a term often heard in devices but rarely seen. It involves the seamless integration of VR in AR environments. It requires vastly superior optics than you need for AR or VR and the result is a superior user experience. The XR1 from Varjo is the best XR I have seen. It is also the only XR I have seen. It seems to me to have been a real barrier breaker at a venue where most companies offered mere refinements. In my demo, I viewed a wireframe of a car such as I have seen in VR displays, only this time I was seeing the wireframe while enjoying eye contact with the company representative. That’s when it started getting interesting: the wireframe filled out into a car that looked tangible, and I got to get inside the car and see deep details in the instrumentation. Making the demo car make sense. It seemed obvious that the XR1 was a superior tool for auto prototyping, as well as perhaps architectural and construction tours of virtual structures. If I were a VC, this would have won my Investor’s Choice Award.

Focals by North. These are the most consumer-ready AR glasses I have seen and are fashionable for everyday people to wear in public. The tiny screen is almost unnoticeable when looking at someone wearing them. The idea is that you can see augmented information as you go about your regularly scheduled life. At $599, suggested retail price, the price remains a little steep except for affluent early photographers. I found the ring-shaped controller a bit awkward. The booth was jammed, and everyone seemed as impressed as I was. My demonstration guide was the only booth vendor to not correct me when I talked about consumers as customers. An overall takeaway is that headsets are finally getting less expensive, lighter weight, and more comfortable while the quality is significantly improving. This was the Best of Show in that category, based on what I saw.

Lenovo ThinkReality A6. Lenovo first dipped its toe into Immersive Technologies in 2016 in partnership with Google’s Tango software. It created the promising but ill-fated Phab2 phone, which I thought showed more promise that the market apparently did. I was happy to see Lenovo has re-entered the Spatial Computing market with ThinkReality, an entirely new brand focused on enterprise immersive tech for developers. I took a quick look at their recently launched A6, which seemed to me to be quite lightweight with a comfortably wide field of view. I think Lenovo is a strong brand for this market and this market seems to be where the money is right now. I plan to take a longer look at this one somewhere down the line.

A Few Disappointments

As much as I liked AWE, there were a few lingering disappointments, ones that indicate that industry growth may not ramp as quickly as the industry hopes— even after assuming a more sober stance. A few that struck me:

No Giants. Although there were attendees from Google, Facebook, Apple and Magic Leap, none had a presence on the stage or in the exhibition area. This is a shame, because their presence goes far to legitimize a nascent industry, and these companies are clearly major players. Each, of course, have their own developer conferences, and their own business reasons for low-profiling at AWE, but in my view, the omission does not serve a nascent industry where each has invested billions.

No Deals. At truly top tier conferences, you can smell deal-making in the air. You see a couple of industry competitors quietly talking in a corner. On the last day, the conference host usually announces a merger, acquisition or game-changing deal. There were lots of private rooms and dinners, but still, nothing like this has happed at an AWE as far as I know. It needs to if AWE aspires to become a venue where deals are known to get made.

Supply-side dominated. Perhaps there were no deals because the sellers seem to vastly outnumber the buyers.  Almost everyone I met was a vendor.  I saw only two VCs in two days. You can have the best products and technologies on Earth, but it doesn’t matter if the right people aren’t there to kick your virtual tires.

Paucity of Business Press. There were plenty of trade press present and most did a good to superior job of covering new tech. But there was a real paucity of business press from the New York Times to USA Today to Business Insider. Charlie Fink of Forbes did a good job of covering, but he writes from the tech perspective in a business publication. This is not intended to disparage either Fink or AWE, so much as to gauge for industry evolution. When the events merit it, the big media will cover.

Lost Face. I was surprised not to see Tom Emrich, who has been the face of AWE for the last five years and someone I have come to like and admire. Three days after the conference Emrich announced his resignation from AWE and his joining Augmented Reality.com. His announcement was gracious and positive, and he clearly will remain a luminary in the category. But this is an apparent blow for AWE: he will be very hard to replace.

Post Manic Immersion

Andy Grove, the early CEO of Intel wrote several memorable books that describe the two phases of disruptive technology. First, comes Mania, which works a lot like a gold rush: there is widespread excitement, and a few people get rich very quickly.

But second, Grove noted, comes a longer, slower, less frantic period. People who never found gold discover they could do well by selling food, pickaxes or by opening banks. This period is the true transformative period even if it is less thrilling than the days of gold and mania.

Perhaps the lesson of AWE #10 is that the mania for Spatial Computing arrived like a lightning bolt and then slowly dissolved into something less thrilling but far more enduring.

This thought came to me as I drove slowly home after AWE came to its close.

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