So, Juniper Research just issued a report that “predicts global revenues from (mobile) augmented reality applications and services will approach $1.5 billion by 2015.” And I wanted to see what you guys thought about that number… Does it sound accurate? Is it way off (in either direction)? What’s going to drive that revenue? I’d love to hear your thoughts.
For the record, my official answer is: WTF??? By 2015? How?
That is a gigantic number, and I’m not sure how it’s achievable given the issues mobile AR has and will have for the next few years… I’ve tried to raise industry awareness about the (current) issues with mobile AR by writing about them in this blog ad nauseum. Those issues include: inaccurate civilian grade GPS; fragmented development environment (iOS, Android); inadequate processing power of handsets; battery life; and, subpar/unnatural consumer experience (to name a few). If you want more details, you can read one of our previous posts by clicking here. In my mind, these issues will delay consumer adoption/usage and serious development efforts.
To put $1.5 billion in context, Mobile has been blowing up in the States the past few years and according to eMarketer we’re finally going to surpass $1 Billion in mobile ad spending for the first time in 2011… Oh, and the largest segment of that ad spend? Text message marketing.
Obviously the app market is a crowded and difficult one to succeed in but I came across a quote yesterday that I think is pretty applicable and telling (especially about consumer usage habits): there is a 5% retention rate on free apps after 30 days. So where is this $1.5 billion going to come from? If people don’t even use free apps after 30 days, do you think the “average person” would pay an upfront fee for any of these apps? I don’t…
Now, I’d love to hear your thoughts below, or on Twitter: @jack_benoff