Why AR, not VR, is the next big thing in business

A person looking at a digital representation of an engine
(Image credit: Shutterstock)

This article originally appeared in Issue 9 of IT Pro 20/20, available here. To sign up to receive each new issue in your inbox, click here.

For many years, there’s been much talk about how virtual reality (VR) is going to be the next big thing in business. Indeed, we’ve been told that the technology will revolutionise corporate training and that it can help companies to cut costs and boost sales. What’s more, if some recent reports are to be believed, businesses could soon start to run simulations to ensure staff are socially distanced amid the COVID-19 pandemic.

In reality, though, VR technology - which became ‘mainstream’ when Facebook acquired Oculus back in 2014 - is still relatively niche and has yet to become the enterprise-dominating technology we were promised.

But that’s largely because it’s already been usurped. That usurper lies in the form of augmented reality (AR), which uses technology to superimpose information, such as sounds, images, and text, on the world we see. While AR may still be in its infancy, it’s a rapidly maturing technology that might just have the potential to revolutionise businesses in the way that VR promised to do so not so long ago.

All about that base

Technologies such as the original Google Glass were early pioneers of AR, and in recent years and months, it’s become the focus of many big-name tech companies. Microsoft has made a big push into AR with its enterprise-focused HoloLens headsets and, earlier this month, Facebook - which previously put all of its weight behind VR - announced Project Aria, a research initiative that will help the company build the first generation of wearable AR devices). Heck, even Apple is said to be investing heavily in AR, having passed on entering the VR space.

This big-name backing, particularly that of Apple, will help AR truly become mainstream. So will the fact that many of us have been using this technology in some way for years, be it through Snapchat filters or Pokémon GO. That’s largely because AR doesn’t require new hardware and, as such, the ubiquitous nature of the technology means it’s available on everyday devices, such as smartphones, tablets, and laptops.

As we’ve seen with the mass adoptions of these everyday technologies, the more people who understand and embrace it, the faster it will become embedded into the collective consciousness.

“With AR, the technology is ready and has numerous use cases. Because of the huge penetration of smartphones, the devices are out there,” says Glenn Gillis, CEO of AR outfit Sea Monster.

“We believe AR is going to fundamentally change the way we connect the real world with the digital world and that there isn't a single business or industry that isn’t going to be disrupted by AR. Contextual, visual, interactive overlays of digital information into the real world will win over other interactive technologies.”

This ubiquity, according to research from Digi-Capital, means AR could approach an installed base of 3.5 billion by 2023, generating some $85 to $90 billion in revenue. VR, on the other hand, will likely reach an install base of 50 to 60 million within the same period and generate revenues of $10 to $15 billion.

“Mobile AR’s ubiquity and low cost could also help enterprise AR adoption,” Digi-Capital comments. “Together with new generations of smart glasses, enterprise AR could see steady growth until it hits an inflexion point around 2021 across manufacturing and resources, TMT, government (including military), retail, construction/real estate, healthcare, education, transportation, financial services and utility industries.”


The ubiquitous nature of augmented reality isn’t all that will see it surpass VR when it comes to enterprise use. It’s also far more flexible as it doesn’t require you to strap a headset to your face, become oblivious to the goings-on in the real world, nor make you get hooked up to a powerful computer, meaning you can only really use it indoors.

AR is far more socially acceptable; the technology doesn’t aim for its users to be totally blind to their surroundings. In fact, it can be argued that AR is designed to achieve the exact opposite - by superimposing a layer of usual visuals and data on top of a real-time image, users can be more responsive to the environment around them, unlike with VR.

This flexibility means that AR has a multitude of business applications. It has all the advantages of remote conferencing, collaboration, design, and realistic experience, but without the need for cumbersome or expensive headsets.

Angela Ashenden, principal analyst of Workplace Transformation at CCS Insight, tells IT Pro: “The concept of VR has long been understood, and its use cases have remained relatively consistent, particularly around virtual training and 3D design and visualisation.

“However, with augmented and mixed reality (MR) technologies that overlay the virtual on top of the physical world, we're now seeing an explosion of new ideas and possibilities for how businesses might use these tools. Training and 3D visualisation remain common themes, but the use of AR removes abstraction and adds greater mobility, for example enabling workers to be trained on the job, or enabling users to visualise exactly how a factory layout will fit in situ.”

AR success

Many businesses are already seeing huge success from their early implementation of AR technologies. BMW, for example, has piloted the use of smart glasses at its Munich plant to display picking information in the worker’s field of vision, while barcode scans enable interaction with the warehouse management system. The pilot resulted in a 22% reduction in inventory identification time and a 33% reduction in errors over a typical eight-hour shift. Furthermore, Boeing has implemented an HMD for assembling wire harnesses for commercial aircraft. This helped the company cut production time by 25% and lowered error rates to nearly zero.

The industry where AR is proving most transformative is the healthcare sector. Research shows AR can help patients better describe their symptoms, help nurses more easily find veins, and even assist surgeons in the operating theatre. What’s more, a rollout of Microsoft HoloLens headsets in the NHS has helped provide emergency healthcare during COVID-19 and reduced the number of staff required by patients’ bedside.

“We recently helped Alder Hey Children’s NHS Foundation Trust adopt Microsoft’s HoloLens 2 mixed reality headsets and Dynamics 365 Remote Assist software – initially to help clinicians collaborate with their colleagues and provide emergency and critical healthcare during COVID, but now to help expand and improve on remote healthcare and community care across North-West England, Wales and the Isle of Man,” Darren Hedley, Director of Public Sector at Insight UK, tells IT Pro.

“Remote Assist has also allowed clinicians to support one another remotely during ward rounds, meaning the necessary expertise is always available without needing multiple staff at the bedside.”

Carly Page

Carly Page is a freelance technology journalist, editor and copywriter specialising in cyber security, B2B, and consumer technology. She has more than a decade of experience in the industry and has written for a range of publications including Forbes, IT Pro, the Metro, TechRadar, TechCrunch, TES, and WIRED, as well as offering copywriting and consultancy services. 

Prior to entering the weird and wonderful world of freelance journalism, Carly served as editor of tech tabloid The INQUIRER from 2012 and 2019. She is also a graduate of the University of Lincoln, where she earned a degree in journalism.

You can check out Carly's ramblings (and her dog) on Twitter, or email her at hello@carlypagewrites.co.uk.