Augmented and Virtual Reality

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The interaction of physical and computer-generated reality is no longer a vision of the future, but has been shaping our present for a long time. Welcome to the age of mixed reality.

Artificial intelligence already pervades our lives. Alexa’s voice from Amazon Echo reminds us of appointments and our navigation systems guide us through traffic. Augmented Reality (AR) connects us with our environment in innovative ways. AR enriches our lives in new dimensions.

For example, the computer-assisted visualizations used by sports commentators on TV are nothing but AR. The same goes for smartphone games, such as Pokemón Go, or voice-controlled artificial intelligence systems, such as Cortana (Microsoft) and Watson (IBM).

In contrast to Virtual Reality (VR), AR does not create an independent, artificial world. Rather, it puts an interactive, virtual layer on top of the real environment, thus displaying additional information. The biggest opportunities are new interfaces between humans and machines that enable customer communication, such as B2B or B2C. The mobile app Layar, for instance, shows users embedded digital content and has a geo-layer feature to find nearby restaurants and events. Users simply hover their smartphone camera over an item for the screen to show information on top of the image.

There are challenges, however, when it comes to clarifying the legal rules that apply to these scenarios. All areas of intellectual property law overlap here. Simply broadcasting a live concert in a 360-degree environment via a VR application, for example, involves more than copyright issues, such as the licensing of music rights. Further, the question arises whether the broadcaster enjoys individual rights as an organizer. In both areas, aspects of personality rights and privacy laws are involved.

When the business model consists in analyzing user behavior, regulatory questions must be addressed. In such cases, product placement is a key field of application. Legal implications concern the Interstate Broadcasting Treaty, the protection of minors, telemedia law, and competition law.

Even legal domains that appear rather absurd at first glance will play a role. They illustrate how the connection between virtual and real worlds is formed. If AR applications are used in the public space, say, householders’ rights or special use rights must be considered.

Last but not least, an all-important issue must be resolved: how can data ownership be indicated in legally pertinent ways?

Real digital services

While the introduction of Google Glass into the mass market failed, the industry continues to rely on data displays via glasses. The headsets of U.S.-based company Meta are equipped with a transparent display that allows for natural interactions with virtual objects. The Meta 2 AR headset contains a camera that captures the user’s hands, providing a particularly intuitive system for controlling holograms.

Volvo shows customers detailed holograms of configured vehicle models using the augmented reality headset, HoloLens, developed by Microsoft. Microsoft developers have now even created Holoportation, which teleports video chat partners into the room as a hologram. ThyssenKrupp equips technicians with HoloLens headsets during elevator maintenance. Technical data and images are transferred to support the experts in their work. Thus, work can be performed up to four times faster.

It will not take long until AR technologies become vital parts of our everyday lives. They will superimpose on our reality layers of helpful information, entertainment content, or advertising. As a by-product, they will generate personal data.

Augmented vs. Virtual Reality

As distinct from Augmented Reality, Virtual Reality generates an entirely artificial reality, using special hardware and software. This may manifest as a realistic archaeological visit to past cultures or a simulated flight in a space ship. Consumers might be immersed in the fantasy world of a computer game or take true-to-scale tours in buildings yet to be constructed.

The core of current VR applications is a headset with high-resolution displays for artificially generated images, including a sensor system to determine the head position. When Sony recently introduced its VR headset for the PlayStation, it was sold out within a few days. In 2016, the developers of Crytek launched The Climb, the first AAA video game entirely designed for Virtual Reality. Wearing the Oculus Rift headset, gamers climb up to a mountain top.

While the gaming industry is the cradle of Virtual Reality, the movie industry, too, increasingly invests in VR. Oculus, for instance, founded a production company, Story Studio, for this purpose. In addition, sports events could soon be broadcasted via VR, from the perspective of a VIP seat right in the stadium.

Beyond the entertainment market, Virtual Reality gains significance for companies as a communication tool. Great potentials also lie in industrial design, architecture, medicine, research, and education. The healthcare industry sets high hopes on VR as well, whether for medical diagnostics, surgical training, telemedicine, or an expanded surgical field of vision. Training simulations for pilots, train drivers, astronauts, etc. are further fields of use.

It is retail in particular that increasingly focuses on Virtual Reality as a marketing tool. IKEA customers, for example, can VR-visit realistic displays of their new kitchens right in their homes. With the assistance of VR headsets and 3D streaming, visitors to the stores of UK fashion group Topshop were able to enter a virtual world during London Fashion Week. It made them feel as though they were participating live, right by the catwalk.

Augmented Reality and Virtual Reality are neither transient hypes nor mere gimmicks for gamers and tech enthusiasts. Systematically moving out of niche spots, they penetrate more and more areas of application. In the same way that the (mobile) internet led to a global digital revolution, VR and especially AR technologies will join our daily lives in what will be a mixed reality.

The topics here presented dealt with future and innovation. They were developed in cooperation with the Zukunftsinstitut, which, as one of the most influential think tanks in European trend research, continuously investigates the changes taking place in business and society.