Business transformation
November 28, 2022

Merging virtual and reality with extended reality technology

Extended reality blurs the line between virtual and real-world experiences through cutting-edge technology.

Key takeaways: 

  • Extended reality includes augmented reality, virtual reality, and mixed reality
  • Customer engagement, data analysis, safe training, and communication and collaboration are just some of the ways in which extended reality tools are being implemented
  • BMW is one of many companies that has integrated extended reality into its processes

Quest Pro is the first in Meta’s new line of headsets, and, as Mark Zuckerberg announced in a recent promotional video, is “built to expand what's possible in VR." The video impressively visualizes the world which users are transported to through the headset, a world where one can interact with virtual objects, avatars, and peers by seamlessly integrating the digital space with reality. This is Zuckerberg's vision for the metaverse, and the Quest Pro is one of the first extended reality devices that facilitates access to it.

What is extended reality?

In the simplest terms, extended reality (XR) encapsulates all kinds of immersive technologies. These include:

  • Augmented reality (AR): Here, users can interact with digital projections overlaid onto the real world. Since AR technologies use a digital interface, users can only interact with digital objects.
  • Virtual reality (VR): With this technology, users can experience fully-digital immersive environments by interacting with simulated objects in a computer-generated virtual world.
  • Mixed reality (MR): Here, uses wear a headset to see virtual objects in real-world environments. They can interact with real and virtual objects through an enriching, immersive experience.

Unlike AR, which simply adds an extra layer of immersiveness to real-life, XR technologies blur the boundary between the virtual and physical worlds.

These characteristics neatly align with the metaverse’s vision and purpose. After all, like XR, the metaverse aims to synergize real and virtual world experiences

However, the similarities end there. That’s because the metaverse is the result of the merging of physical and digital worlds. Extended reality, in contrast, is how we get to this point. According to Samsung, “If metaverse represents a set of spaces online in a social/cultural setting, extended reality is the underpinning of that virtual reality.”

What are the benefits of extended reality?

  • Better customer engagement: The average attention span of a human is a mere 8 seconds. So, brands have little time to engage with customers, create an impression, and win them over. Companies can create novel, scroll-stopping customer experiences through XR tech, for example through virtual trials or even via an interactive ad.  
  • Better communication and collaboration: A recent study showed that 70% of remote employees felt detached from their workplaces, impacting their communication with colleagues. With XR technology, both remote and in-office employees can attend meetings in the metaverse, connecting and catching up with their peers using 3D avatars.
  • Better data analysis: The latest XR tech allows brands to obtain granular customer data based on their interactions in virtual environments. For example, they can now collect info like heart rate, eye tracking, and other sensory feedback, in order to better understand buyer intent.
  • Safe training: Like VR, extended reality is an excellent teaching tool. Trainees can use these to safely practice dangerous scenarios like military training, rescue drills, surgery, and more. Besides, since XR is immersive, it encourages users to touch, feel and react to virtual objects.

Given the wide range of applications, extended reality technology can be used across sectors, from gaming to defense, creating rich user experiences. Plenty of big brands are already using the technology today, with many more looking to invest. For perspective, going by current trends, the market size for XR will reach USD $393 billion by 2025.

The market size for XR will reach USD $393 billion by 2025.

Case Study: How BMW is using XR to improve vehicle development

While creating its new iX car in 2022, BMW altered its vehicle development processes. The company started complementing its traditional engineering tools with gaming industry technology.

With a new mixed reality system, the car manufacturer fast-tracked early development stages and used gaming simulators to help users check performance. It also used AR to visualize vehicle functions and concepts, allowing developers to choose between designs quickly.

Developers could now test the prototype's functionality by checking viewing angles, seating positions and more, without building a physical model. This lead to greater efficiency, and speeded up the design process.

Costs associated with implementing XR technology

  • Upfront costs: Although AR and VR technologies have existed for a few years now, setting up XR processes is still an investment. That's because most technologies are still nascent. Besides, on the hardware side, companies must develop 3D objects and virtual worlds as well as ensure they work well. These costs can range from USD$5k to USD$100k, depending on requirements.
  • Hardware issues: End users need expensive hardware, including VR headsets, mobile phones, and a 5G connection, in order to experience extended reality effectively. Again, these technologies currently aren’t widely available, further making the widespread adoption of extended reality difficult at this present time.
  • User experience: Many users report having uncomfortable experiences in the virtual world. These commonly include headaches, dizziness, and nausea, and might deter new users from adopting the technology.

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