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1Ericsson | Augmented tomorrow: AR experiences beyond smartphones and AR lters
Augmented tomorrow:
AR experiences beyond
smartphones and AR lters
Exploring consumer expectations and needs in
an evolving XR landscape
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2 Ericsson | Augmented tomorrow: AR experiences beyond smartphones and AR lters
02 Methodology
03 Key findings
04 Introduction
05 Together, smartphones and
AR/MR devices can elevate
consumer AR experiences
07 A slice of life, the role of AR
devices in the next five years
09 Three stages of AR experience
evolution
11 In the eye of the beholder,
form, privacy and social
acceptance
13 The path ahead, pondering
the next five years
Methodology
This report presents insights from
Ericsson ConsumerLab research on
XR. Data for this study was collected
through both in-depth interviews and
online surveys.
Qualitative research
22 in-depth interviews were conducted
between April and June 2023 with 12
current AR/VR users, 7 industry experts
and 3 XR startup companies: TagSpace,
forwARdgame and EyecandyLab (now
part of Accedo). Interviewees were
located in the US, Japan, South Korea
and Germany.
Quantitative research
An online survey was fielded between
July and August 2023 in 10 markets.
The sample consists of 10,000 early
adopters aged 15 to 69, with 1,000
from each market, who use smartphone
AR apps and/or VR/AR/MR headsets/
glasses at least every other week or
plan to do so in the next five years. The
sample represents 280 million early
adopters in the markets surveyed.
While early adopters are a small
fraction of consumers globally, their
early adopter profile makes these
individuals important when exploring
how wider groups of consumers might
use these technologies in the future.
The respondents were asked a range of
questions about their current usage, the
perceived benefits, challenges, future
adoption intention, and expectations
around XR-powered experiences in the
next five years.
Data collected between July and August 2023
Europe:
UK
Germany
Sweden
North America:
US
Central and
Latin America:
Brazil
Middle East:
UAE
Oceania:
Australia
Asia:
Japan
Mainland China
South Korea
Terminology
Extended reality (XR) refers to a range of technologies, including augmented
reality (AR), virtual reality (VR), and mixed reality (MR), that combine
physical and digital environments to create immersive experiences. Headsets,
glasses as well as smartphones are the common devices used to bring these
technologies to life.
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3Ericsson | Augmented tomorrow: AR experiences beyond smartphones and AR lters
Key ndings
03. As AR technology advances in adapting to geospatial
surroundings, the range of XR experiences will become
more diverse and demanding on 5G
Current consumer AR experiences center on information,
navigation, and social AR filters. As geospatial AR technology
progresses, the use case landscape will expand to include
more diverse applications featuring precise location tracking
and enhanced environmental awareness. Examples of such
applications are AR sports viewing and concerts, public digital
arts, and augmented tourist displays. This expansion will
demand 5G networks to deliver consistent, real-time experiences.
01. Consumers combining smartphones and AR devices will
double in the next five years
Despite low satisfaction with current smartphone AR
experiences, those that combine smartphone and VR/AR/
MR headsets/glasses tend to be happier. Over the next five
years, the share of such combined use is projected to double.
Furthermore, consumers expect lightweight and portable AR/
MR devices becoming essential companions to smartphones.
02. Consumers are hungry for on-the-go AR devices and
willing to pay 20 percent more for the portability
Today, VR/AR/MR headsets/glasses are largely limited to
home use, serving as shared household devices. However,
three-quarters of consumers anticipate the availability of
portable AR devices, likely in glasses form, for outside-of-
home and on-the-go use in the next five years, expressing
a willingness to pay a premium for such devices.
04. Bystander privacy still looms large, hindering
device adoption
Bystander privacy, referring to consumers feeling exposed
to others scanning them with AR devices, remains a critical
concern among consumers, with 60 percent expressing
apprehension globally. This worry significantly reduces
the share of users intending to adopt AR devices by 18
percentage points.
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4 Ericsson | Augmented tomorrow: AR experiences beyond smartphones and AR lters
Introduction
Extended reality (XR) technology allows for greater
immersion in virtual realities or the enhancement of the
physical world by blending digital and physical elements,
adding new layers of meaning and experience.
This enables new and exciting ways to engage with the
world around us, whether it be through shopping,
socializing, or artistic expression.
Augmented reality (AR) plays a significant role in various
industries and has become more accessible to average
consumers in recent years through smartphone AR apps.
Today, many young consumers are obsessed with AR filters
and lenses on social apps. While other age groups find AR
apps to be convenient and efficient in wayfinding, translation
and product try-on or fitting during the shopping journey.
However, consumers face many challenges with today’s
smartphone AR experiences, from limited content, low
quality of experience, physical strain, and social acceptance.
Similarly, the availability of consumer-friendly XR headsets
is still limited, with virtual reality (VR) headsets being the
most widespread option. Consumer-friendly AR headsets/
glasses are still emerging. However, industry experts
believe XR technology, especially AR, will significantly
impact consumers and society, with the potential to replace
smartphones in the future and become the next paradigm
shift. According to the International Data Corporation (IDC),
AR headsets are expected to grow in 2024, even though at
a slower pace compared to VR headsets, but diversification
among the different products will increasingly address more
needs. (idc.com report 2023).
Since 2017, ConsumerLab has explored the growing
consumer expectations in XR in several reports. In the
report titled ‘Merged reality’, we explored how both AR and
VR could potentially transform consumers’ daily life. This
report uncovers current consumer XR adoption and future
expectations for augmented reality experiences and devices
in the next five years.
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5Ericsson | Augmented tomorrow: AR experiences beyond smartphones and AR lters
Together, smartphones and
AR/MR devices can elevate
consumer AR experiences
The industry is set to deliver new devices and experiences to
consumers, looking for the next big thing and aiming for a
killer device and use cases with the potential to replace the
smartphone. Consumers are curious, but so far, no revolution
has taken place, XR devices, AR, VR and Mixed Reality (MR)
glasses and headsets are still mostly a curiosity.
The smartphone´s place in consumers’ lives is indisputable,
it’s nearly an extension of users’ bodies. Its position and
how intertwined it is in our lives makes it hard for consumers
to imagine another type of device replacing it. For most
consumers, the smartphone is the entry point for AR
experiences and they see the smartphone as a suitable
platform for more real-time access and practical AR
experiences. Popular AR experiences on smartphones are AR
filters/lenses on social media apps, AR navigation apps, AR
translation apps, and AR gaming. Interest in smartphone AR
apps has been increasing steadily as insights from the latest
Consumer Lab report 5G value: Turning performance into
loyalty (2023) indicated a 50 percent increase in daily time
spent on smartphone AR experiences between 2021 and
2023 among 5G users. If you ask consumers, the smartphone
is here to stay.
However, consumers want to experience AR out and about
in society, and while the smartphone remains a versatile
and convenient option for basic AR experiences, consumers
face issues with using it. A main hassle is how smartphone
AR is limited by a small screen, it also tires the arm when
the smartphone is held up and it has low immersiveness. In
addition, two out of ten say there’s just not enough relevant
content. Consumers also desire more advanced experiences
that involve integrating spatial awareness of their
surroundings and 3D mapping of objects to provide more
immersive experiences.