CENTER STAGE: Augmented Reality Meets Real Business; Layar Talks About Mobile Advertising & Immersive Enterprise
In brief: Europe’s first-ever Augmented Reality (AR) business conference is the perfect jumping-of point for a look at Dutch Augmented Reality (AR) company Layar, an interview with Maarten Lens-FitzGerald, Layar Co-founder & VP of Distribution and Marketing, and some updated company news & stats.
The overwhelming positive response to Europe’s first-ever Augmented Reality Business Conference and Developer Camp (ARBCon) speaks volumes about the new direction and vast potential of AR. The event – which was organized by my esteemed colleague Dan Romescu, an AR pioneer, to bring together companies across the emerging business ecosystem including developers, VCs and researchers. It attracted over 155 participants and featured over 30 speakers/keynotes from 17 countries.
I am pleased to collaborate with Dan to grow this event and continue this exchange on MSG through a series of interviews and podcasts with key players in this industry beginning with Dan, who will speak about the Augmented Citizen and the requirement for industry standards and a framework to ensure AR becomes a robust business with the buy-in of the people it impacts. So, what this space!
Meantime, the timing is excellent to move on to another in the “best of” selection of executive interviews from the Netsize Guide 2010.
This week the topic is AR from the perspective of Layar, a Dutch company released its reality browser application Layar last year. This mobile browser shows people what is around them by displaying real-time digital information on top of reality they view through the device camera. On top of the camera image Layar adds content ‘layers,’ which are the equivalent of Web pages in normal browsers. The platform allows customers, such as businesses, the ability to offer a range of layers, allowing consumers to see houses for sale, popular bars and shops, jobs on offer in the area, and a list of local doctors and ATMs by scanning the landscape.
Maarten Lens-FitzGerald, Layar Co-founder & VP of Distribution and Marketing, discusses the ways AR enhances reality and paves the way for real business models.
INTERVIEW WITH MAARTEN LENS-FITZGERALD
Q: Augmented Reality has been around for almost 20 years, but mobile AR exploded last year, when penetration of smartphones equipped with GPS systems, compasses and accelerometers increased. What level of interest are you seeing?
A: In the week that we launched the iPhone app we had over 100,000 downloads and we served over a million augmented views to the world. Currently, there are over 1,500 developers and over 300 layers have been published.
Q: How do you make money on Layer?
A: It’s free for the user and it’s free for the content provider or developer. Where we make money is placement. To understand this we have to understand the user experience. Starting up the Layar application automatically activates the camera. The embedded GPS automatically knows the location of the phone and the compass determines in which direction the phone is facing. Each partner provides a set of location coordinates with relevant information which forms a digital layer.
There will be lots of layers, just as there are Web pages. The problem will be discovery. We address this by allowing companies to participate in our Pay for Prominence program. When users start Layar, it starts up in the Favorites list, which is like Bookmarks on your Web browser. Those positions are for sale. The same goes for the Featured section, a section where companies can pay for placement to reach the more advanced users who come back.
Q: How do you make these layers relevant to me and my context?
A: What we serve in the Favorite and Featured sections is all based on your region. If you’re in the U.S. you won’t see the Dutch layers, for example. So, based on where you are, you select a layer and we send the request through our server to give you the relevant content. If you open up the Trulia layer to find homes for sale, you will be shown houses around your location.
Q: How do you see your pay for placement model evolving? Will you harness personalization or targeting?
A: That is how it will develop. What we do now is help content owners get on top of the stack of layers, much in the same way that Google has AdWords. We will have premium layers where companies can pay to add something to a layer relevant to their offer.
In the future, the browser will know who you are, and that you’re ready to go out, for example. Based on this the top layers you see will be layers about places to go, a lot like restaurant review guides. Some of these listings will be paid for by the restaurant owners or businesses who want to appear in the layer, the same way they advertise on Web pages, for example.
Q: You focus on advertising in this example. Is that the big growth opportunity?
A: It’s for the businesses that need to provide to their customers information right here, right now. I’m looking for a house for sale, so show me one. But it’s not just about real estate; it’s about goods and services nearby in the real world. Where is the bus station? Where can I get a taxi? Where can I get a bite to eat? Any business that has to get this information out to us can benefit from AR. And to enhance this we have added the ability for businesses to provide AR experiences complete with 3-D objects and interactivity.
Q: AR is a nascent industry. What is the value chain and how do you work with other players in your ecosystem, such as operators and brands?
A: We’re in for great ride and, as an industry, we’ll see come change and consolidation. In the end there will only be one or two companies that have the browser and the platform, and will grow from there. I see that happening and within the next six months.
How the value chain is shaping up? Actually, it’s not a chain; it’s a web and it’s all connected. On one hand, we have the users and we’re working on a better user interface to satisfy them. An example of this is our 3-D release, for which we also need new 3-D content and the content developers.
On the other hand, we have the device manufacturers that we talk to in order to get pre-installation deals and also ensure their devices work well with our software, and vice versa. Then we also talk with the carriers about where we can get pre-installed and have a unique offering with Layar.
Q: What is your vision for what AR can enable and how that will impact our lives moving forward?
A: An experience that is very core to AR is the ability to walk around and experience other worlds and walk around in a city the way it was a century ago, for example. That kind of storytelling will enable the creation of immersive experiences. It’s easy to imagine the benefit to education. It will be like being able to not just read a book, but actually visualize it. This is why we added 3-D and interactivity.
AR will also be a boost to vendor relationship management, putting the individual in control of the information they will accept based on their needs. Put another way, AR will allow people to issue a ‘Request For Proposal,‘ which businesses can answer.
Let’s say you’re looking for a table for four in a Mexican restaurant. You put that information out and people are only then allowed to see your profile and to reply to you using AR. So, a restaurant owner might pop up in front of you, saying, ‘hey, I’ve got a table and we have good food – so take a look at the reviews here on the Web and then come on over.’ If you end up going to that restaurant, then we might get a percentage of that deal. That’s a model we’re looking at.
We’re also looking at ways to benefit organizations such as the Heart Foundation in Holland. In time for Valentine’s Day we will make it possible for people to buy and display a 3-D heart in front of the house where their loved one lives, for example. The money will go to charity and people who walk around the city will see all these hearts placed by people who are expressing their love.
LAYAR STATS & UPDATE
To update the interview (conducted in late 2009 for inclusion in the Netsize Guide) I caught up earlier this week with Claire Boonstra, Layar Co-Founder.
According to Claire, the company has two major milestones to report.
One will be public in June, when Layar plans significant announcements during a press conference at Amsterdam HQ.
The other was just last week when the company launched a kind of AR app store/marketplace giving publishers on the Layar platform the opportunity to monetize their content for Android and iPhone platforms.
Specifically, publishers and developers (such as Berlitz, which was one of the first publishers to offer an AR city guide using the marketplace) can now create AR content, syndicate it on Layar’s platform and charge people a small one-time fee to access it.
The biz model: Layar is facilitating the marketplace – which uses PayPal to process the actual transactions – allowing people to buy and sell layers in the U.S., the U.K. Canada and Australia. Layar takes a 40 percent cut of the sale (compared with the Apple App Store that takes 30 percent) to pay costs associated with legal, admin and banking.
The numbers:
- Some 550 layers are live and another 2,000 are in development
- 3,000 publishers worldwide are creating AR content for the Layar platform
- 1.6 million Layar AR browsers installed and pre-installs on LG and Samsung models, as well as devices supported by Verizon and Sprint (with more to be announced “in the coming months”)
The takeaway: The opportunity: the 60/40 rev split may be more than the 70/30 we know from the Apple App Store, but this is a marketplace aimed at jumpstarting a real business for AR publishers. Making it way to do business (and enabling payments) is a value-add and Layar can extract value for it. Overall, a marketplace could bring mobile AR, which has long lagged behind desktop AR, a huge and necessary step forward.
THE NETSIZE GUIDE
The Netsize Guide – which features exclusive interviews with 28 industry senior executives at leading companies and organizations including Havas, M&S, MMA, Nokia NAVTEQ, PayPal and Sony Music Entertainment — provides unique perspectives and reveals how players across the mobile ecosystem are preparing to meet the challenges and take advantage of the opportunities ahead.
The Netsize Guide 2010 also includes the results of Mobile Trends Survey 2010, an online survey asking +1,000 mobile professionals and practitioners across 67 countries their views on these key themes and their insights into trends that top the industry agenda, including the advance of mobile applications stores, progress towards global mobile commerce and the increasing importance of mobile across a range of business verticals.
Finally, the Netsize Guide 2010 presents detailed data on the wireless telecoms sector in 41 countries, including revenues, market shares and value-added service offerings for messaging and billing of 194 mobile network operators worldwide.
DOWNLOAD YOUR FREE NETSIZE GUIDE HERE.
Disclaimer: Netsize is an MSG supporter. Peggy Anne Salz is author of the Netsize Guide 2010.
Tags: accelerometers, AR, augmented reality, GPS, Layar, Mobile Marketing, Netsize, Netsize Guide 2010
