Augmented Reality: Trends, Applications, and Potential

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Augmented Reality: Trends, Applications, and Market Potential

April 9, 2021

The concept of Augmented Reality, or “AR”, has been around for years (see image below). Initially, it was thought of as simply a new application for gaming enthusiasts around the world. However, advancements in artificial intelligence, machine learning, computing power, graphics cards, and other major components are starting to unfold a revolutionary road map. From medical applications to nutritional dissection of the food on your plate, experts and enthusiasts everywhere are racing to piece together incredible new technologies for consumers and businesses. 

Before moving further, let’s quickly highlight the difference between virtual reality (VR) and augmented reality (AR): AR enables users to experience the real world with some version of a simulated overlay. VR, by contrast, is a completely simulated and fully immersive experience.

Here’s a quick snapshot of how AR works:

A Market Overview

According to Grand View Research, the augmented reality and virtual reality markets are expected to grow by $125 billion during 2020-2024, representing a CAGR (Compound Annual Growth Rate) of over 35% (1). 

Additionally, for AR specifically, the market was valued at $17.67 billion in 2020 and is expected to expand at over a 43% CAGR from 2021-2028 (2). Major market segments for AR are summarized by Grand View Research in the chart below: 

The above categories are defined as follows: 

  • HMD (Head-Mounted Display) & Smart Glass, the primary source of market growth

  • HUD (Head-Up Display)

  • Handheld Devices

Based on these projections, the greatest benefits may be derived from HMD and smart glass applications. Let’s zoom in on this subcategory. 

HMD & Smart Glass Application

The applications for HMD and smart glass can and will take the shape of many different applications and use cases. In general, these products are developed to add some sort of visual aid enhancement on top of what you see around you in real life. These projections or visual overlays can help with important visualizations that assist us in personal or business-related functions and are currently broadly available through smartphones and tablets. 

Aside from the obvious form of entertainment and gaming, which took a major leap with the launch of Pokemon Go in 2016, smart glass can introduce efficiency to the way that we operate on a daily basis. Some of these major applications include: 

  • In-store comparison shopping. To provide an example from the Ikea Place Mobile app, users can utilize AR to help visualize what furniture might look like in their living space.

  • Advertising

  • Location services (think Google and Apple Maps on steroids). Here’s another example from Google: 

  • Educational Training

  • Complex Manufacturing 

  • Supply Chain Logistics and Warehousing

A recent study showed that 93% of large industrial companies are either using or evaluating smart glasses in their enterprises today, validating the fact that major corporate decision-makers believe that there is substantial opportunity in the wearable technology space (3). Forrester also estimates that there will be over 14 million workers using smart glasses by 2025. (3)

Through the lens of a major supply chain application, the following primary and secondary benefits are anticipated: 


  1. Increase productivity through real-time, contextualized workflows

  2. Reduce quality defects and rework

  3. Facilitate real-time, informed decision making

  4. Enhance workforce collaboration

  5. Improved safety


  1. Simplify routine workflows and checklists

  2. Decrease risk in industrial operations

  3. Enhance effectiveness in training programs with the use of interactive and virtual sessions

  4. Capture workflow analytics to identify process improvement opportunities

  5. Increase accountability through inspection workflow recording

While these benefits are specific to supply chain management, there are a few key outcomes or goals that other industries could apply through AR as well. Specifically, workforce training, real-time performance feedback and evaluation, collaboration with other positions and departments, simplification of routine tasks, and increasing job accountability. 

With this in mind, let’s take a closer look at a few of the major players in AR, specifically smart glass and HMD. 

Product Landscape

Google Glass 2, price: $1,167

  • 720p resolution

  • 80-degree field of view, a leader in the field of view metric

  • Tracking and control: hand and eye-tracking

  • Battery life: 8 hours, also a category leader

  • Integrated GPS

  • Voice command with built-in headphones

  • Glass Pod removable from the mainframe and can be attached to safety glasses for use on factory floors

  • Video overview:

Microsoft HoloLens 2, price: $3,500

  • 2048 x 1080 pixels 

  • 52-degree field of view

  • Tracking and control: hand and eye-tracking

  • Battery life: 6 hours

  • Primarily used by AR developers, and includes features such as remote control and sharing of AR

  • Projects to overlay 3D color images over natural spaces so the user sees mixed reality and can interact with virtual 3D models and holographs

  • Top-rated in category

  • Video overview:

Epson Moverio BT-300, price: $699

  • 720p resolution

  • 23-degree field of view

  • Tracking control: hand and eye-tracking

  • Battery life: 6 hours

  • Applications include remote assistance and are popular with drone operators because they get a bird’s-eye view directly to their smart glasses

  • Instead of floating images in the real world like the HoloLens, the Epson model shows a virtual display floating in the real world in front of the user’s eyes. The display moves relative to eyes and head positions.

  • Based on the Android platform

  • Video overview:

M&A and Other Industry Investment Activity

  1. In August 2020, Google Ventures invested around $14.5 million in Blue Vision Labs, an AR start-up company based in the U.K. 

  2. In October 2020, Facebook relaunched its Spark AR Partner Network program, which envisages connecting creators and brands with AR professionals as part of the efforts to enable new experiences on Instagram and Facebook. Additionally, Facebook acquired Oculus in 2014 and acquired CTRL-Labs in 2019.

  3. Apple acquired startups NextVR and Spaces in 2020. Apple previously acquired Akonia Holographics in 2018 and startup Vrvana in 2017. 

  4. In the AR space, the participation by company size is typically barbell shaped, with many startups flooding the AR/VR space, in addition to the major technology giants participating materially. Again, key players operating in the augmented reality market include:

    1. Microsoft

    2. Google 

    3. Apple

    4. Sony Corporation

    5. Blippar 

    6. Infinity Augmented Reality 

    7. Niantic

    8. Magic Leap


While augmented reality can both offer promising enterprise solutions and provide an incredible new version of interfacing with the world, it is not without its challenges. Currently, there are less proven business models, lack of development standards, prevalent security issues, clear possibilities of physical harm during use, and poor quality of content. All of these, however, can be fixed over time. Based on many projections for future revenue growth and adoption, we can assume that experts predict many of these issues to be resolved over the next 5-10 years. 

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  1. $125 Billion Growth in Global Augmented Reality (AR) and Virtual Reality (VR) Market 2020-2024 | APAC to Emerge as Major Market | Technavio.”,35%25%20during%20the%20forecast%20period. Accessed 5 Apr. 2021.

  2. Augmented Reality Market Size & Share Report, 2021-2028.” Accessed 5 Apr. 2021. 

  3. Using smart glasses and augmented reality head-mounted displays to drive supply chain innovation.” Accessed 5 Apr. 2021. 

  4. AR Smart Glasses: Applications, Challenges & Future Potential [2020].” Accessed 5 Apr. 2021.

  5. 10 BEST Augmented Reality Glasses (Smart Glasses) In 2021.” Accessed 5 Apr. 2021.

  6. What is augmented reality (AR) and how does it work? - Blog.” Accessed 5 Apr. 2021.

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