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What Is Augmented Reality?

By Motley Fool Staff – Jun 28, 2019 at 10:19PM

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Is it the next big thing or the next 3D television?

It's easy to confuse augmented reality (AR) and virtual reality (VR). The easy way to think of AR is as an overlay on top of what's actually happening. It's not a pretend world or a total escape -- it's an enhanced version of real life. That technology has popped up in a lot of places and its uses have been expanding outside of its early foothold in gaming, but it's too early to know exactly how big it will become.

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This video was recorded on June 25, 2019.

Jason Moser: We were talking last week while I was away, coming up with some ideas for today. We thought it would be a fun idea to talk about something we haven't had a chance to talk a lot about on these shows. That's augmented reality. Part of this stems from the fact that, as many listeners may know, we've recently opened up an augmented reality service. I've been tapped to be the advisor on that service. It's been a lot of fun for me. I've been digging in essentially for the entire year learning about the space and all the ideas in it. We thought today would be a great opportunity to dig more into it. You have some experience with the space as well, particularly on the hardware side. Let's jump right in here. First and foremost, when it comes to augmented reality, because it's easy to get augmented reality and virtual reality confused --

Dan Kline: There's a gray area, too.

Moser: Yeah, mixed reality. You're right, there is a little bit of a gray area. Let's talk about what augmented reality is and isn't.

Kline: The easiest example for augmented reality, the one everyone is going to understand, is Pokémon GO. There are a lot of games now that are like, "It's Harry Potter, but Pokémon GO."

Moser: Wizards Unite.

Kline: Yeah. There's a Star Wars one that never caught on. Basically, how Pokémon GO works -- I'm the last guy who still plays. I am a devoted Pokémon GO, level 36, getting there. You're walking around the real world. There's a reality overlay, where all of a sudden, I might look up, and Pikachu is jumping on your head. It'd be awesome if Pikachu was here. He is actually doing tomorrow's show.

Moser: He's scheduled.

Kline: Pikachu is an added layer of reality on top of what's actually happening. In a practical sense, that might be, a doctor is wearing glasses, and when he's cutting you, it projects a line for where he supposed to cut. That would be a very simple augmentation. Virtual reality is when you are completely in another world. I have an Oculus Go. We'll talk about that later. It does some augmented and some virtual reality. The virtual reality would be, I put on my headset, and I'm on a roller coaster. It has nothing to do with where I am. I'm in a completely different experience, but it feels real because it's immersive. The augmented experience might be if you and I had a meeting, and you're sitting at a desk, and I'm sitting at a desk, but it looks like we're in a boardroom together and we're seeing it on the headsets. Some of that's virtual; some of that's augmented. It's not a clear line. But it's basically an enhanced reality.

Moser: Yeah. That's it. I was thinking about this as we were coming up with ideas for the service when we first opened it. I know you live in Florida, I know you're a Disney guy. I remember many trips to Disney as well. But I remember vividly going to Disney World the very first time, when I was 10 or 12 years old, the haunted house, the old traditional haunted house you go through. I think it was the very last stretch where you go through and you pass in front of these mirrors. And if you look in the mirror, sitting either next to you or on top of your head or somewhere in there would be a ghost. That essentially was augmented reality even then, wasn't it?

Kline: It was. And that ride is exactly as you remember it! And it would have been exactly as you remembered it in 1965 at Disneyland! I might be getting the years Disneyland started wrong there.

Moser: The point remains, the technology's been there for a while.

Kline: Yeah. Let's talk about augmented reality as what it's going to be and what it isn't. What I mean is, do you remember two years ago, maybe three years ago, at CES, when 3D television was the thing? ESPN was spending big money in broadcasting. Weird things. It wasn't just basketball games. It's like, "We're doing NBA Roundup in 3D!" It was like, why?

Moser: It was weird. It sounded way better than it really was.

Kline: And it was very expensive. You'd buy your $3,000 3D television, and all you got was gimmick programming. Augmented reality, I think it's fair to say, is a real technology at a low level. When I say low level, I mean iPhone, Pokémon GO. That level. It's accepted, it's a thing. It's a tool to make money, it's not necessarily a moneymaker itself. What we don't know is if augmented reality is going to be a gimmick or it's going to become a part of our everyday life. We know that there's business uses. We talked about medical a few seconds ago. We know that doctors are going to be using these, and they can spend $5,000 on glasses or whatever, because they're buying million-dollar MRI machines. What we don't know is if Macy's, to bring this back to consumer goods -- six months from now, you're going to walk into the dressing room, hold up the clothes you want to try on, it's going to show you wearing it and show it to you in six different colors and you can hit the button and order from the website. That technology exists. Whether it becomes practical... Things like a virtual tailor is a form of augmented reality. It's being used in very high-end design. Do you watch any of the Flip Your House shows?

Moser: Oh, yeah. HDTV gets a lot of traction in our house.

Kline: They all show you, "This is what the room would look like." Now, when it's a completely redone artist rendering, it's a virtual reality. But if you show a picture of my room, and then show me what the flooring choice would look like next to my furniture, that's augmented reality.

Moser: Let's talk about that for a second. You made a good point there. It's the difference between the technology vs. what we do with the technology. It reminds me of 3D printing.

Kline: Oh, that was going to be the thing.

Moser: Honestly, the technology itself is helpful for a lot of companies out there. It's not as consumer facing. Honestly, more so, it helps companies protect their technology.

Daniel B. Kline has no position in any of the stocks mentioned. Jason Moser has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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