XR for Business

By Alan Smithson from MetaVRseBusiness Technology Arts

XR for Business episodes

March 24, 2020 Turning a Game Engine into a Training Experience, with PIXO VR’s Sean Hurwitz
Today’s guest Sean Hurwitz started his journey to the XR field in the realm of game development. But as the years went on, more and more he saw the value of putting game engines to work training professionals instead of hunting zombies. He talks about how PIXO VR achieves this.
Alan: Hey, everyone, it’s Alan
Smithson here with the XR for Business podcast. Today we’re speaking
with Sean Hurwitz, founder and CEO of PIXO VR, a Detroit based
company focused on VR software for training on processes, safety, and
emergency response. Much like myself, Sean believes that extended
reality — or XR — technologies can unlock human potential, and
realize limitless possibilities. He’s assembled an all-star team of
game changing VR and AR engineers, and we’re going to talk about how
this translates directly into safety and training across all
different industries. All that and more on the XR for Business
podcast.
Sean, welcome to the show, my friend.
Sean: Hi, Alan. Thanks for
having me.
Alan: It’s my absolute pleasure.
I’m really, really excited. I’ve been kind of using your VR training
video that you did. It was in a basement, and you’re training gas
meter people on how to how to — I guess –use a gas meter. But I’ve
been using that video to show the diverse range of things that can be
done within VR. Tell us about that. Tell us about PIXO VR.
Sean: Yes, I am definitely
onboard with the way that XR and training will definitely change the
ecosystem, make people’s lives safer and more effective, and
hopefully make more money too, at the end. So yeah, the example that
you give is a replication of a basement, where technicians were in
the traditional way of training, driving around, mirroring or
shadowing older technicians as the evolving workforce and the younger
generation coming in. And they were training the new employees, the
new trainees, and they were looking for a way to do this training
that would be close to real life, rather than drive around for weeks
or months on end. And they couldn’t show– the problem was they
couldn’t really identify or show all the variances in the gas meters
in these basements. So we did a multi-user randomized scenario of
millions of different setups and scenarios of what these gas meters
would look like, and really expedited the training timeline. So PIXO,
that’s sort of the– using your video as an example. But we started
as a traditional console video game company, moving quickly into
mobile and enterprise, and then even quicker in 2016 into getting the
first Oculus DK and starting to build enterprise VR training, from
that point forward.
Going from making games, because I just
interviewed Arash Keshmirian from Extality, and he was doing the same
thing. They were making virtual or augmented reality games for
phones. And now they’re making enterprise solutions. How did you make
that shift from going to making games to enterprise? And was it
simply a way of making money or just– what is the precipitating
factor of going from making games to basements full of gas fitting
technology?
Sean: Well, money certainly
plays a role, but really the mission to make people’s lives better,
to help improve the planet that we live on, being able to utilize the
skill set that we’ve spent combined dozens of years, used the same
skill set, even the same game engine as to develop interactive games
— which is really what this training is — to be able to replicate
things that you either were too expensive to do otherwise or just too
risky to do. So, once we figured out that we were able to create the
scenarios in the field — or in a basement, like you said earlier —
and then actually make money doing it served the purpose and the
mission, and also getting paid for solving problems rather than
developing games and hoping someone will download it or purchase it.
Alan: It’s definitely one of
those things that you can do a lot more good with these things. Now,
what kind of elements have you taken from the game production side —
or days — and brought them in? Have you gamified these things? Is
there like, a hidden thing where I can pull out a sword and start
cutting things in half? Do you guys have any hidden Easter eggs in
there?
Sean: Maybe not Easter eggs, but
something along those lines would be the randomization engine that we
have. So every time you enter into an environment where applicable —
which for us is the vast majority — where we randomize different
hazards or defects or different things that you have to learn. As an
example, we developed the fall protection module for mostly the
construction industry where you have to pick– you’re up on an 80
storey building — again, utilizing all environments, 3D modelling
scenarios that you would build in a video game — and you put someone
80 storeys above the ground on scaffolding, and they have to pick the
right harness. So when the harnesses are randomized every time, you
really have that decision making utilized there. We use a lot of game
level design as well. And if you pick the wrong harness, obviously,
you fall to your death — really — on this 80 storey building. Good
news is it’s all virtual, so you learn your lesson, one way or the
other. So we utilize, really, all game development techniques for
that module and everything that we build, whether it be the design,
whether it be the game level, whether it be the data analytics and
reporting from the user management. And understanding not only how to
optimize these applications, but how did you do, it could be used at
a competitive basis where you can compete against your previous
training, the previous time that you went in, or against other
co-workers. So many, many different game aspects used.
Alan: Interesting. What are some
of the data points you’re collecting about users and learners, and
how are you measuring success with this type of technology, versus
just a standard classroom or on the job training? What’s the
measurement of success?
Sean: Well, like I said before,
the ability to really have someone do something and interact in an
environment through an active learning process. One of the best uses
that we found for VR currently is in assessment. So let’s just stick
with this fall protection. How would you assess if somebody really
understood what to do when they were up on this scaffold? This is a
way to really test their skill set, and if they fail, they’re able to
fail at a low cost and at a low risk scenario. So that’s not
something that you can do in a classroom. You can take a test, as you
know, PowerPoint. We’ve used in the past. You can you can take a
three ring binder and study it, go through it, do a test. But it’s
not like actually doing it. So we track all the points, what they
pick first, what they pick second, what they look at, where they go.
All the data points that make up the story about whether that trainee
actually knows what they’re doing. And as you know, with VR — and
XR, really — with biometrics coming on to the scene here, in the
near future, you’ll be able to track cognitive load and how their
body actually responds to those different training scenarios.
Alan: Are things like biometrics
becoming part of this, or is this kind of a future plan? Because I
would think that being 80 storeys up is kind of terrifying. People’s
heart rate must be going through the roof.
Sean: Oh, it sure is. Yeah, I
definitely think that biometrics is going to play a huge role in all
of XR, specifically in this VR training because you could use it then
as an assessment tool. Not only on the individual trainee and the
potential employee early on, it could be used at a interview process
early on in the cycle or later on. And did they get better? Are they
more comfortable in these different situations? As well as to
optimize the experience. So is it too much training? We recently
developed a emergency response natural gas leak scenario, where
you’re in the middle of a subdivision — and again — utilizing
multi-user, some AI components and a technician is faced with a
potentially very serious gas leak that they have to eventually turn
that gas off. Now, the training not only tells you about the
individual, but it could also tell you about is this just too much
for an individual? Does it require two people? It could influence the
real life training thereafter.
Alan: So how do you measure that
then? Like, how do you know whether somebody is ready?
Sean: Well, we’re currently not
using any biometrics right now, but once the new hardware comes onto
the scene with sensors in it, that will track that person’s cognitive
load and body temperature, those kind of things. The results of that
would tell you if this person’s suited for that kind of role or not.
Alan: The amount of data we can
collect from this and share is incredible. It’s not just about trying
to sell people more things, but if this data can be used to deliver
training in a more efficient, effective way, I think this is the
ultimate goal.
Sean: It sure is. And really the
still being in that early adopter, early majority phase and having
yet crossed that chasm to the later, mid later majority efficacy from
this training — I think — will mean everything, will be where it
becomes commonplace. So we found that we were over the years, got
good traction with the early adopters that we’re most likely going to
adopt and integrate early technology no matter what. I think we’re
moving into a little bit of that early majority, but I think for the
late majority to really catch on, you’re going to need real efficacy
where it’s– you can prove it’s saving lives, it’s improved training,
you’ve saved a lot of money. And I think 2020 is a big year for that.
I think we’re at that crossroad.
Alan: Yeah, I really, truly
agree with that. So you guys have been working diligently on building
out these scenarios and everything. What are some of the other ones
you’ve talked about? Fall protection, emergency response, gas
fitting. What are some of the other ones that you guys are working
on?
Well, in the very near future, where we
got some nice press coming out soon with some of the ones that we’re
going to release, we have a first responder operations for hazmat,
where we have a spilled over gas tanker for firefighters. Now, the
way that we developed these, Alan, is, for instance, our hazard
recognition. We have hazard recognition, which are like OSHA
standards that would be in a warehouse, but because we’ve productized
that application, we could put hazard recognition on a construction
site, or in a hospital, or in a steel factory, or an automotive
factory. So we’ve productized the actual learning objective behind it
and then can very easily flip the environments to be address most
industries. So when I say we have hazard recognition, it’s really
across multiple recognitions. We have the natural gas leak emergency
response that I spoke of already, fall protection, the inside meter
inspection that we spoke about already. Now, just to back up for one
second. The way that our platform works is our business model is we
go to market and distribute the content through VARs, or Value Added
Resellers. We’ve also developed on the front-end a content curation
side of the platform, that will allow other developers to monetize
their content through our reseller network. So through– if you can
imagine that all the amazing content that’s been developed and great
developers out there that don’t have the sales side of things, our
library — if you will — our content side is going to increase
rapidly, as we bring these other developers on.
Alan: Amazing. That seems like a
scalable way to do it.
Sean: It is. I mean, we–
earlier on — when I say earlier on, meaning the last couple of years
— we learned that we had a hard time selling to first responders or
the construction companies or oil and gas company, because we didn’t
know what the pain points were for that training. So partnering with
these resellers — who understand the pain points — are much better
at selling this training content into their industries. So that’s why
on the sales side. And then we’re obviously automating all that
through the platform.
Alan: Incredible. Where can
people find you? It’s pixovr.com?
Sean: Yep, pixovr.com. We tend
to have presence at most of these different trade shows that we go
to, but pixovr.com is definitely the place.
Alan: I think this is something
that people will be listening, and the goal of this podcast is really
to educate business owners and business communities to invest and
start using this technology. So what would be the path for a new
customer? So let’s say, for example, somebody is in — I don’t know
— trucking, and they want to develop a trucking training. What is
the path for them to go from reaching out on your website, to having
the full thing delivered? What does that look like?
Sean: We would start by having a
conversation. First of all, is do we have the content that they’re
looking for? Are there other developers that may have already the
content that they’re looking for? And then we would most likely pair
them up with one of our resellers, that would know– have much more
knowledge and education in in the trucking space — in this scenario
— to really help integrate. Because as you know, these business
owners are finding the value of VR and XR pretty quickly. It’s easy
to put on a headset and go up 80 storeys and look over the edge and
say, “Wow, this is very impactful. This is game changing.”
to actually integrating it into their business. So how does it fit
into their business model? Where do they put it? Who does the
training? Who trains? How many headsets? And through our resellers,
we answer a lot of those questions, because they’ve already done it,
they already know where to put it, they already know who maintains
it, what category it goes under. So we would be able to help not only
on the content side, but also on the integration side.
Alan: Integration side is
actually becoming one of those challenges that people– it used to be
a technology problem. “Can we make this technology work? OK, now
it works. Can we can we make it do something we want? Okay, that
works. How do we get it out and how do we scale it in a reasonable
way?” That’s the next step of it.
Sean: Over the years, we’ve been
faced with multiple problems, really just problem solving and
creating a product market fit, and integration sort of rose to the
top. The hardware is getting better. The people that [make] VR and
the knowledge of VR — and XR — is becoming more available. And then
without real strong efficacy, you can’t have integration before
efficacy. So you have to integrate it. You have to start using it.
And so I think those problems — like we said before — will be
addressed. Not fully, but I think 2020 is looking bright.
Alan: Interesting. I agree with
you. I think now people are beyond that kind of shiny object syndrome
of VR at the beginning, and they’re looking for real solutions. And
it’s funny, because I’ve got your webpage open here and it’s just a
video playing in the background. But you’ve got everything from a
warehouse fall, and fire trucks, and everything. It’s really
incredible, the work you guys have done. And I think in 2020
companies are starting to realize the power of It. What about
numbers? When somebody says to you — from a number standpoint —
this is going to cost X amount. What is my return? How do you deal
with those questions?
Sean: Well, I think it’s a good
question, because that means that they have a use case, or they’ve
identified a pain point or a reason to use it. One of our clients
works with a very large auto manufacturer — being here in Detroit,
obviously, that’s in our backyard — that we’re sending engines
around the world, to train on the engines, replace the timing belt or
filter or something like that. So you can already see where the value
of VR is. Because we took the CAD of the engine model, and replicated
that and made it fully interactive and multi-participant. So they can
train the trainees or the technicians all around the world, without
having to send the engine out. So you could back into an ROI pretty
quickly. Well, how much does an engine cost? How much does an engine
cost to ship? How many were we shipping out? And then how much does a
standalone headset cost, and how much did the application cost? And
so you can see right there in that example of immediate ROI.
Alan: Yeah, absolutely.
Something that we’ve seen is in VR, you’re creating these assets for
training. But those same assets can be also used for marketing or
different divisions. Are you seeing that? Because what we realized is
that usually one arm doesn’t talk to the other, and there’s very
little crossover there. But as you start suggesting these things
that, hey, you just spent X amount by making all these models of
these things for your training. Would this be something that they
could do into retail or marketing?
Sean: Well, you and I both know
that absolutely is possible.
Alan: The question isn’t “Can
you?” It is “Do they?”
Sean: For VR/XR, all things
under this umbrella, any adoption is great. So early on, anyone that
was interested in it, we would work with them and try to license them
some content. Yes, though. The answer is yes. At a high level, that
it can be used– and we are starting to promote it, because when they
look at costs for one department — or one division, depending on how
large the company is — then we try to promote them that you could
leverage this asset, get more out of it in different categories. Yes.
Alan: And it’s interesting. We
tried to do that as well. But it’s one of those things that– they’re
like, “Yeah, that’s great. But dealing with the marketing
department is a whole different ball of wax.” It’s crazy.
Sean: It definitely is, yeah.
And a lot of innovation departments are the ones reaching out first.
Alan: Yeah, absolutely. Though
the problems you get with the innovation departments, they’re
usually– they want cutting edge things. And it ends up getting stuck
in pilots. They get a small budget for a pilot, and then they– there
seems to be a disconnect between the innovation department of the
company, and actually deploying real solutions.
Sean: That’s true. But I think
as we understand integration better and as we solve those problems,
we can help the innovation department. Because what we found was, we
did some projects with innovation departments and we didn’t know
ourselves how they would integrate it and they certainly don’t. So
the more we’ve learned, the more we lean on our reseller subject
matter experts, the better we’re getting and the more traction we’re
getting.
Alan: I guess one thing to
consider when we’re doing this. You mentioned standalone headsets.
Clearly people want this. Clients are saying, “Hey, I want to
move to a standalone headset.” But the tradeoff of fidelity
versus that, what are you guys seeing with, let’s say the Oculus
Quest, for example?
Sean: Yeah. You know, it depends
also on the type of company. We work with insurance companies, where
they want to take 40 headsets and put them in the trunks of 40
different agents, and have them go on site on a construction site and
do this type of training. They’re just not going to take a PC tether
based unit and throw it in their trunk and go set it up. So in that
scenario, the standalone, the Quest or other would work very well.
Where you have training facilities and you have the staff or the
employees trainees coming into that facility to train, then, of
course, a unit that’s stationed and you could get that higher
quality. But we found that the quality on the standalone is
definitely suffice and outweighs the barrier. For instance, this
insurance company, they’re just not going to do the other. So the
quality is definitely, definitely good enough.
Alan: Interesting. Wow. There’s
so much to take in. We’ve got this this idea — both of us have
thought about this a lot — of how do we use this technology as
efficiently as possible. And one of the things that you mentioned —
which I think is similar to our business model as well, and we’re
gonna have to talk offline on how to work together on this — but
distributing the content through value added resellers, and also
reselling content. Because making quality VR content and AR content
is expensive, and being able to share those costs across multiple
companies seems like the only way to really grow the industry.
Sean: It is. That’s definitely
something that’s a little newer for us. We just are finishing some of
the tools within the platform that will be able to ingest other
content and then monetize it. We’ve created this ecosystem of taking
it from content development — that we’re not calling content
curation, because it could really come in a number of different ways
— all the way through an end user license. So we feel like we’ve put
this ecosystem and this process together, and now just continue to
automate it through the tools. So whether it’s other people’s content
or we’re developing our own content– we even have tools that would
expedite the content development for other developers — whether it
be randomization engine, multi-user engine, or art environment packs
— that we would work with other developers to help expedite the
development if they didn’t have existing content.
Alan: So what would that look
like from your standpoint, would there be a license fee or how would
that work?
Sean: We haven’t monetized those
tools yet like that. We would rather just work with the developer to
help develop, because we’re after the content. So we would work with
them on those licenses or even the use of those tools in order to get
these applications or the content. So we have resellers and their
clients that are currently looking for content. So if we would work
with other developers and provide these tools to help expedite
development. So in short, we don’t have a toolkit that we license out
currently, but we would definitely work with other developers to use
those tools.
Alan: That’s something that I
think is kind of one of those things in this XR industry. It seems
like everybody’s willing to help each other, and that’s an amazing
thing in an industry that we’re still at the beginning. But I keep
saying this over and over again. This is not a net sum game. Our
industry is going to go from $10-billion to $500-billion in 10 years,
creating — by PWC’s estimate — over $2-trillion in enterprise value
in the next 10 years. That’s a lot of money to split, and there’s not
a lot of companies working at the level of PIXO. And it’s really
interesting to see that you’re so open to working with everybody.
It’s great.
Sean: Yeah, thanks. I definitely
think that there’s room for everybody. I’ve yet to really– when you
drill down and you have more of a sophisticated XR person looking
into it, I’ve really yet to find two or three companies or more that
are doing exactly the same thing. I feel like we all have our little
niche, a little bit here, a little bit there, and can leverage each
other and those attributes. Because in my opinion, the market really
needs to grow in the next year or two. Now is the time. I’d hate for
all of us–
Alan: Yeah, I agree. And that is
one of the reasons I started this podcast. One to learn personally,
but also to inspire and educate business leaders to invest in this
technology as fast as possible, because the more knowledge we get out
there. And if you look at the podcast, the way it works, it’s done
and it’s tagged by industry. So if somebody is interested in retail,
that’s up in retail and there’s all the things for them, and for
interest in the airlines, or training, or whatever it is.
Unfortunately, training comes up in pretty much everyone, because
that’s the killer use case of VR. But what is one problem in the
world you want to see solved using XR technologies?
Sean: The one problem with 15
seconds to think about it, is I truly believe that exposing people,
trainees, people learning a different skill — especially if it’s
dangerous — exposing them to that environment, whether you’re a
doctor, or a construction worker, or firefighter before being in that
environment for real, whether it be crowd management, I think that
solving that problem or allowing someone to be exposed to a scenario,
before they actually have to go in it, will absolutely make the world
a better place.
Alan: Well, Sean, this has been
really, really a great interview and thank you. Is there any final
words you want to share with anybody?
Sean: So if there are developers
out there that have content — or want to develop content — are
interested in monetizing that, get a hold of us. Otherwise, I really
appreciate it, Alan. I look forward to following up and staying in
touch.
Alan: I will hit you up in
Detroit. Motor City, here we come!
Sean: Yes, sir.
28 min
March 24, 2020 Turning a Game Engine into a Training Experience, with PIXO VR’s Sean Hurwitz
Today’s guest Sean Hurwitz started his journey to the XR field in the realm of game development. But as the years went on, more and more he saw the value of putting game engines to work training professionals instead of hunting zombies. He talks about how PIXO VR achieves this.
Alan: Hey, everyone, it’s Alan
Smithson here with the XR for Business podcast. Today we’re speaking
with Sean Hurwitz, founder and CEO of PIXO VR, a Detroit based
company focused on VR software for training on processes, safety, and
emergency response. Much like myself, Sean believes that extended
reality — or XR — technologies can unlock human potential, and
realize limitless possibilities. He’s assembled an all-star team of
game changing VR and AR engineers, and we’re going to talk about how
this translates directly into safety and training across all
different industries. All that and more on the XR for Business
podcast.
Sean, welcome to the show, my friend.
Sean: Hi, Alan. Thanks for
having me.
Alan: It’s my absolute pleasure.
I’m really, really excited. I’ve been kind of using your VR training
video that you did. It was in a basement, and you’re training gas
meter people on how to how to — I guess –use a gas meter. But I’ve
been using that video to show the diverse range of things that can be
done within VR. Tell us about that. Tell us about PIXO VR.
Sean: Yes, I am definitely
onboard with the way that XR and training will definitely change the
ecosystem, make people’s lives safer and more effective, and
hopefully make more money too, at the end. So yeah, the example that
you give is a replication of a basement, where technicians were in
the traditional way of training, driving around, mirroring or
shadowing older technicians as the evolving workforce and the younger
generation coming in. And they were training the new employees, the
new trainees, and they were looking for a way to do this training
that would be close to real life, rather than drive around for weeks
or months on end. And they couldn’t show– the problem was they
couldn’t really identify or show all the variances in the gas meters
in these basements. So we did a multi-user randomized scenario of
millions of different setups and scenarios of what these gas meters
would look like, and really expedited the training timeline. So PIXO,
that’s sort of the– using your video as an example. But we started
as a traditional console video game company, moving quickly into
mobile and enterprise, and then even quicker in 2016 into getting the
first Oculus DK and starting to build enterprise VR training, from
that point forward.
Going from making games, because I just
interviewed Arash Keshmirian from Extality, and he was doing the same
thing. They were making virtual or augmented reality games for
phones. And now they’re making enterprise solutions. How did you make
that shift from going to making games to enterprise? And was it
simply a way of making money or just– what is the precipitating
factor of going from making games to basements full of gas fitting
technology?
Sean: Well, money certainly
plays a role, but really the mission to make people’s lives better,
to help improve the planet that we live on, being able to utilize the
skill set that we’ve spent combined dozens of years, used the same
skill set, even the same game engine as to develop interactive games
— which is really what this training is — to be able to replicate
things that you either were too expensive to do otherwise or just too
risky to do. So, once we figured out that we were able to create the
scenarios in the field — or in a basement, like you said earlier —
and then actually make money doing it served the purpose and the
mission, and also getting paid for solving problems rather than
developing games and hoping someone will download it or purchase it.
Alan: It’s definitely one of
those things that you can do a lot more good with these things. Now,
what kind of elements have you taken from the game production side —
or days — and brought them in? Have you gamified these things? Is
there like, a hidden thing where I can pull out a sword and start
cutting things in half? Do you guys have any hidden Easter eggs in
there?
Sean: Maybe not Easter eggs, but
something along those lines would be the randomization engine that we
have. So every time you enter into an environment where applicable —
which for us is the vast majority — where we randomize different
hazards or defects or different things that you have to learn. As an
example, we developed the fall protection module for mostly the
construction industry where you have to pick– you’re up on an 80
storey building — again, utilizing all environments, 3D modelling
scenarios that you would build in a video game — and you put someone
80 storeys above the ground on scaffolding, and they have to pick the
right harness. So when the harnesses are randomized every time, you
really have that decision making utilized there. We use a lot of game
level design as well. And if you pick the wrong harness, obviously,
you fall to your death — really — on this 80 storey building. Good
news is it’s all virtual, so you learn your lesson, one way or the
other. So we utilize, really, all game development techniques for
that module and everything that we build, whether it be the design,
whether it be the game level, whether it be the data analytics and
reporting from the user management. And understanding not only how to
optimize these applications, but how did you do, it could be used at
a competitive basis where you can compete against your previous
training, the previous time that you went in, or against other
co-workers. So many, many different game aspects used.
Alan: Interesting. What are some
of the data points you’re collecting about users and learners, and
how are you measuring success with this type of technology, versus
just a standard classroom or on the job training? What’s the
measurement of success?
Sean: Well, like I said before,
the ability to really have someone do something and interact in an
environment through an active learning process. One of the best uses
that we found for VR currently is in assessment. So let’s just stick
with this fall protection. How would you assess if somebody really
understood what to do when they were up on this scaffold? This is a
way to really test their skill set, and if they fail, they’re able to
fail at a low cost and at a low risk scenario. So that’s not
something that you can do in a classroom. You can take a test, as you
know, PowerPoint. We’ve used in the past. You can you can take a
three ring binder and study it, go through it, do a test. But it’s
not like actually doing it. So we track all the points, what they
pick first, what they pick second, what they look at, where they go.
All the data points that make up the story about whether that trainee
actually knows what they’re doing. And as you know, with VR — and
XR, really — with biometrics coming on to the scene here, in the
near future, you’ll be able to track cognitive load and how their
body actually responds to those different training scenarios.
Alan: Are things like biometrics
becoming part of this, or is this kind of a future plan? Because I
would think that being 80 storeys up is kind of terrifying. People’s
heart rate must be going through the roof.
Sean: Oh, it sure is. Yeah, I
definitely think that biometrics is going to play a huge role in all
of XR, specifically in this VR training because you could use it then
as an assessment tool. Not only on the individual trainee and the
potential employee early on, it could be used at a interview process
early on in the cycle or later on. And did they get better? Are they
more comfortable in these different situations? As well as to
optimize the experience. So is it too much training? We recently
developed a emergency response natural gas leak scenario, where
you’re in the middle of a subdivision — and again — utilizing
multi-user, some AI components and a technician is faced with a
potentially very serious gas leak that they have to eventually turn
that gas off. Now, the training not only tells you about the
individual, but it could also tell you about is this just too much
for an individual? Does it require two people? It could influence the
real life training thereafter.
Alan: So how do you measure that
then? Like, how do you know whether somebody is ready?
Sean: Well, we’re currently not
using any biometrics right now, but once the new hardware comes onto
the scene with sensors in it, that will track that person’s cognitive
load and body temperature, those kind of things. The results of that
would tell you if this person’s suited for that kind of role or not.
Alan: The amount of data we can
collect from this and share is incredible. It’s not just about trying
to sell people more things, but if this data can be used to deliver
training in a more efficient, effective way, I think this is the
ultimate goal.
Sean: It sure is. And really the
still being in that early adopter, early majority phase and having
yet crossed that chasm to the later, mid later majority efficacy from
this training — I think — will mean everything, will be where it
becomes commonplace. So we found that we were over the years, got
good traction with the early adopters that we’re most likely going to
adopt and integrate early technology no matter what. I think we’re
moving into a little bit of that early majority, but I think for the
late majority to really catch on, you’re going to need real efficacy
where it’s– you can prove it’s saving lives, it’s improved training,
you’ve saved a lot of money. And I think 2020 is a big year for that.
I think we’re at that crossroad.
Alan: Yeah, I really, truly
agree with that. So you guys have been working diligently on building
out these scenarios and everything. What are some of the other ones
you’ve talked about? Fall protection, emergency response, gas
fitting. What are some of the other ones that you guys are working
on?
Well, in the very near future, where we
got some nice press coming out soon with some of the ones that we’re
going to release, we have a first responder operations for hazmat,
where we have a spilled over gas tanker for firefighters. Now, the
way that we developed these, Alan, is, for instance, our hazard
recognition. We have hazard recognition, which are like OSHA
standards that would be in a warehouse, but because we’ve productized
that application, we could put hazard recognition on a construction
site, or in a hospital, or in a steel factory, or an automotive
factory. So we’ve productized the actual learning objective behind it
and then can very easily flip the environments to be address most
industries. So when I say we have hazard recognition, it’s really
across multiple recognitions. We have the natural gas leak emergency
response that I spoke of already, fall protection, the inside meter
inspection that we spoke about already. Now, just to back up for one
second. The way that our platform works is our business model is we
go to market and distribute the content through VARs, or Value Added
Resellers. We’ve also developed on the front-end a content curation
side of the platform, that will allow other developers to monetize
their content through our reseller network. So through– if you can
imagine that all the amazing content that’s been developed and great
developers out there that don’t have the sales side of things, our
library — if you will — our content side is going to increase
rapidly, as we bring these other developers on.
Alan: Amazing. That seems like a
scalable way to do it.
Sean: It is. I mean, we–
earlier on — when I say earlier on, meaning the last couple of years
— we learned that we had a hard time selling to first responders or
the construction companies or oil and gas company, because we didn’t
know what the pain points were for that training. So partnering with
these resellers — who understand the pain points — are much better
at selling this training content into their industries. So that’s why
on the sales side. And then we’re obviously automating all that
through the platform.
Alan: Incredible. Where can
people find you? It’s pixovr.com?
Sean: Yep, pixovr.com. We tend
to have presence at most of these different trade shows that we go
to, but pixovr.com is definitely the place.
Alan: I think this is something
that people will be listening, and the goal of this podcast is really
to educate business owners and business communities to invest and
start using this technology. So what would be the path for a new
customer? So let’s say, for example, somebody is in — I don’t know
— trucking, and they want to develop a trucking training. What is
the path for them to go from reaching out on your website, to having
the full thing delivered? What does that look like?
Sean: We would start by having a
conversation. First of all, is do we have the content that they’re
looking for? Are there other developers that may have already the
content that they’re looking for? And then we would most likely pair
them up with one of our resellers, that would know– have much more
knowledge and education in in the trucking space — in this scenario
— to really help integrate. Because as you know, these business
owners are finding the value of VR and XR pretty quickly. It’s easy
to put on a headset and go up 80 storeys and look over the edge and
say, “Wow, this is very impactful. This is game changing.”
to actually integrating it into their business. So how does it fit
into their business model? Where do they put it? Who does the
training? Who trains? How many headsets? And through our resellers,
we answer a lot of those questions, because they’ve already done it,
they already know where to put it, they already know who maintains
it, what category it goes under. So we would be able to help not only
on the content side, but also on the integration side.
Alan: Integration side is
actually becoming one of those challenges that people– it used to be
a technology problem. “Can we make this technology work? OK, now
it works. Can we can we make it do something we want? Okay, that
works. How do we get it out and how do we scale it in a reasonable
way?” That’s the next step of it.
Sean: Over the years, we’ve been
faced with multiple problems, really just problem solving and
creating a product market fit, and integration sort of rose to the
top. The hardware is getting better. The people that [make] VR and
the knowledge of VR — and XR — is becoming more available. And then
without real strong efficacy, you can’t have integration before
efficacy. So you have to integrate it. You have to start using it.
And so I think those problems — like we said before — will be
addressed. Not fully, but I think 2020 is looking bright.
Alan: Interesting. I agree with
you. I think now people are beyond that kind of shiny object syndrome
of VR at the beginning, and they’re looking for real solutions. And
it’s funny, because I’ve got your webpage open here and it’s just a
video playing in the background. But you’ve got everything from a
warehouse fall, and fire trucks, and everything. It’s really
incredible, the work you guys have done. And I think in 2020
companies are starting to realize the power of It. What about
numbers? When somebody says to you — from a number standpoint —
this is going to cost X amount. What is my return? How do you deal
with those questions?
Sean: Well, I think it’s a good
question, because that means that they have a use case, or they’ve
identified a pain point or a reason to use it. One of our clients
works with a very large auto manufacturer — being here in Detroit,
obviously, that’s in our backyard — that we’re sending engines
around the world, to train on the engines, replace the timing belt or
filter or something like that. So you can already see where the value
of VR is. Because we took the CAD of the engine model, and replicated
that and made it fully interactive and multi-participant. So they can
train the trainees or the technicians all around the world, without
having to send the engine out. So you could back into an ROI pretty
quickly. Well, how much does an engine cost? How much does an engine
cost to ship? How many were we shipping out? And then how much does a
standalone headset cost, and how much did the application cost? And
so you can see right there in that example of immediate ROI.
Alan: Yeah, absolutely.
Something that we’ve seen is in VR, you’re creating these assets for
training. But those same assets can be also used for marketing or
different divisions. Are you seeing that? Because what we realized is
that usually one arm doesn’t talk to the other, and there’s very
little crossover there. But as you start suggesting these things
that, hey, you just spent X amount by making all these models of
these things for your training. Would this be something that they
could do into retail or marketing?
Sean: Well, you and I both know
that absolutely is possible.
Alan: The question isn’t “Can
you?” It is “Do they?”
Sean: For VR/XR, all things
under this umbrella, any adoption is great. So early on, anyone that
was interested in it, we would work with them and try to license them
some content. Yes, though. The answer is yes. At a high level, that
it can be used– and we are starting to promote it, because when they
look at costs for one department — or one division, depending on how
large the company is — then we try to promote them that you could
leverage this asset, get more out of it in different categories. Yes.
Alan: And it’s interesting. We
tried to do that as well. But it’s one of those things that– they’re
like, “Yeah, that’s great. But dealing with the marketing
department is a whole different ball of wax.” It’s crazy.
Sean: It definitely is, yeah.
And a lot of innovation departments are the ones reaching out first.
Alan: Yeah, absolutely. Though
the problems you get with the innovation departments, they’re
usually– they want cutting edge things. And it ends up getting stuck
in pilots. They get a small budget for a pilot, and then they– there
seems to be a disconnect between the innovation department of the
company, and actually deploying real solutions.
Sean: That’s true. But I think
as we understand integration better and as we solve those problems,
we can help the innovation department. Because what we found was, we
did some projects with innovation departments and we didn’t know
ourselves how they would integrate it and they certainly don’t. So
the more we’ve learned, the more we lean on our reseller subject
matter experts, the better we’re getting and the more traction we’re
getting.
Alan: I guess one thing to
consider when we’re doing this. You mentioned standalone headsets.
Clearly people want this. Clients are saying, “Hey, I want to
move to a standalone headset.” But the tradeoff of fidelity
versus that, what are you guys seeing with, let’s say the Oculus
Quest, for example?
Sean: Yeah. You know, it depends
also on the type of company. We work with insurance companies, where
they want to take 40 headsets and put them in the trunks of 40
different agents, and have them go on site on a construction site and
do this type of training. They’re just not going to take a PC tether
based unit and throw it in their trunk and go set it up. So in that
scenario, the standalone, the Quest or other would work very well.
Where you have training facilities and you have the staff or the
employees trainees coming into that facility to train, then, of
course, a unit that’s stationed and you could get that higher
quality. But we found that the quality on the standalone is
definitely suffice and outweighs the barrier. For instance, this
insurance company, they’re just not going to do the other. So the
quality is definitely, definitely good enough.
Alan: Interesting. Wow. There’s
so much to take in. We’ve got this this idea — both of us have
thought about this a lot — of how do we use this technology as
efficiently as possible. And one of the things that you mentioned —
which I think is similar to our business model as well, and we’re
gonna have to talk offline on how to work together on this — but
distributing the content through value added resellers, and also
reselling content. Because making quality VR content and AR content
is expensive, and being able to share those costs across multiple
companies seems like the only way to really grow the industry.
Sean: It is. That’s definitely
something that’s a little newer for us. We just are finishing some of
the tools within the platform that will be able to ingest other
content and then monetize it. We’ve created this ecosystem of taking
it from content development — that we’re not calling content
curation, because it could really come in a number of different ways
— all the way through an end user license. So we feel like we’ve put
this ecosystem and this process together, and now just continue to
automate it through the tools. So whether it’s other people’s content
or we’re developing our own content– we even have tools that would
expedite the content development for other developers — whether it
be randomization engine, multi-user engine, or art environment packs
— that we would work with other developers to help expedite the
development if they didn’t have existing content.
Alan: So what would that look
like from your standpoint, would there be a license fee or how would
that work?
Sean: We haven’t monetized those
tools yet like that. We would rather just work with the developer to
help develop, because we’re after the content. So we would work with
them on those licenses or even the use of those tools in order to get
these applications or the content. So we have resellers and their
clients that are currently looking for content. So if we would work
with other developers and provide these tools to help expedite
development. So in short, we don’t have a toolkit that we license out
currently, but we would definitely work with other developers to use
those tools.
Alan: That’s something that I
think is kind of one of those things in this XR industry. It seems
like everybody’s willing to help each other, and that’s an amazing
thing in an industry that we’re still at the beginning. But I keep
saying this over and over again. This is not a net sum game. Our
industry is going to go from $10-billion to $500-billion in 10 years,
creating — by PWC’s estimate — over $2-trillion in enterprise value
in the next 10 years. That’s a lot of money to split, and there’s not
a lot of companies working at the level of PIXO. And it’s really
interesting to see that you’re so open to working with everybody.
It’s great.
Sean: Yeah, thanks. I definitely
think that there’s room for everybody. I’ve yet to really– when you
drill down and you have more of a sophisticated XR person looking
into it, I’ve really yet to find two or three companies or more that
are doing exactly the same thing. I feel like we all have our little
niche, a little bit here, a little bit there, and can leverage each
other and those attributes. Because in my opinion, the market really
needs to grow in the next year or two. Now is the time. I’d hate for
all of us–
Alan: Yeah, I agree. And that is
one of the reasons I started this podcast. One to learn personally,
but also to inspire and educate business leaders to invest in this
technology as fast as possible, because the more knowledge we get out
there. And if you look at the podcast, the way it works, it’s done
and it’s tagged by industry. So if somebody is interested in retail,
that’s up in retail and there’s all the things for them, and for
interest in the airlines, or training, or whatever it is.
Unfortunately, training comes up in pretty much everyone, because
that’s the killer use case of VR. But what is one problem in the
world you want to see solved using XR technologies?
Sean: The one problem with 15
seconds to think about it, is I truly believe that exposing people,
trainees, people learning a different skill — especially if it’s
dangerous — exposing them to that environment, whether you’re a
doctor, or a construction worker, or firefighter before being in that
environment for real, whether it be crowd management, I think that
solving that problem or allowing someone to be exposed to a scenario,
before they actually have to go in it, will absolutely make the world
a better place.
Alan: Well, Sean, this has been
really, really a great interview and thank you. Is there any final
words you want to share with anybody?
Sean: So if there are developers
out there that have content — or want to develop content — are
interested in monetizing that, get a hold of us. Otherwise, I really
appreciate it, Alan. I look forward to following up and staying in
touch.
Alan: I will hit you up in
Detroit. Motor City, here we come!
Sean: Yes, sir.
28 min
March 21, 2020 XR for Business News: COVID-19
Most of the world is stuck indoors as the Coronavirus situation looms. Alan has a few words of encouragement for our listeners, and talks briefly about the power XR has to help keep us productive while we flatten the curve.
For more information, check out our past episodes on virtual meeting spaces:
Jacob Loewenstein – Spatial
Jonny Cosgrove – meetingRoom
Gabe Paez – The Wild
Kalle Saarikannas – Glue
Michael C. Cohen – UgoVirtual
7 min
March 21, 2020 XR for Business News: COVID-19
Most of the world is stuck indoors as the Coronavirus situation looms. Alan has a few words of encouragement for our listeners, and talks briefly about the power XR has to help keep us productive while we flatten the curve.
For more information, check out our past episodes on virtual meeting spaces:
Jacob Loewenstein – Spatial
Jonny Cosgrove – meetingRoom
Gabe Paez – The Wild
Kalle Saarikannas – Glue
Michael C. Cohen – UgoVirtual
7 min
March 17, 2020 Building an XR Vocabulary for Businesses, with XR Bootcamp’s Ferhan Ozkan
Code is a big part of what makes XR work, of course. But for most businesses, knowing the DNA of the technology will be less important than knowing how to best use it. XR Bootcamp co-founder Ferhan Ozkan is enabling businesses interested in XR to enable themselves.
Alan: Welcome to the XR for
Business podcast with your host, Alan Smithson. Today, we’re speaking
with Ferhan Ozkan, the co-founder of XR Bootcamp, a platform to teach
professionals how to create VR and AR applications, and support
companies to bridge their skills gap in XR development through an
intensive onsite program, cutting edge curriculum, and industry
renowned lecturers with a focus on industry portfolio projects. I am
personally very, very honored to be on the advisory board of XR
Bootcamp and helping them really develop the future of how
organizations will train their staff on how to build XR technologies.
And so with that, I’d love to welcome Ferhan to the show. Ferhan,
welcome to the show, my friend.
Ferhan: Hi, Alan. Pleasure to be
here. Thanks for inviting.
Alan: It’s absolutely my
pleasure. I just want to give you a little bit of history about you.
XR Bootcamp started from VR First, which was an organization bringing
VR labs into universities and colleges around the world. Is that
correct?
Ferhan: Yes. Yes. Back then —
almost four years ago — we started as VR First. The main mission was
to democratize VR and AR around the world. And you also supported us
on these times, because it was hard to find headsets as a developer,
as a startup. And we actually tried to tackle this problem with the
help of major headset manufacturers – Oculus, HTC, Leap Motion, Intel
— and they supported us to create VR/AR labs around the world. And
we are quite happy with the impact being created now, these labs are
actually really become big and creating amazing projects. And we are
actually proud to have this network and enable this network. Yeah, we
are now actually around 800 university that we can reach and over 400
startup clusters. But as a lab that we have supported and seeded —
as in equipment and other support — we reach to almost 52 labs. And
now we see that these labs become actually quite impactful in their
own region to create a regional VR/AR development scene, and VR/AR
startup and clusters, and they are even creating VR/AR programs —
academic programs — and industrial based trainings.
Alan: Ferhan, when did you guys
realize that bringing this type of knowledge into the enterprise was
the next step?
Ferhan: It is quite interesting,
because we talk with institutions not only in educational, but
government institutions. They reach to us after hearing about VR/AR.
“Can we educate the people in our health institutions? Can we
train the people, the employees that is actually working in the–
airport workers, like on the aviation industry?” And we
understood that there is actually already an initiative happening on
different parts of the world, on different industries based on each
government’s or each region’s industry focus. And then we decided,
“OK, what we can do first of all to start the VR/AR innovation
in each key destination?” So as I mentioned, seeding the
equipment was the first one. I remember in the beginning of 2017, we
had some kind of survey, and unfortunately for every 51 developer,
there was only one headset in any institution or in a startup
cluster. So think of like you want to create something, but you
cannot even access the VR headset, which is a shame for this region.
So we first of all started this seed equipment program, and then
training programs come afterwards. And the biggest supporters or
beneficiaries were actually the top enterprises in this local area,
from manufacturing to automotive, from aviation to defense industry.
And we would like to utilize all of these ecosystems like a startup
cluster. So from the institutional perspective, they can even help
creating a regional economy, with the help of science, parks,
education institutions, and the agile startups.
Alan: You’ve seen a lot of
startups in the industry kind of come– some of them have come and
gone. But what are you seeing as the major trend as we enter into
kind of 2020? VR and AR are starting to pick up steam. Companies are
starting to ask for– what are you seeing from startups now, that you
weren’t seeing a few years ago, that is really trending?
Ferhan: Yeah. I mean, this is a
question that I can answer differently in every year, because of the
rapid, crazy, evolving shape of the industry. But when we look ahead
— 2020 and 2021 — what I see personally is the startups are usually
creating platforms as a service. They just try to create their own
businesses based on their maybe previous experiences, their previous
business strategies. But they also see that it is not working like
that, especially on B2C side. And what I have realized that there are
many agencies, solution providers and startups who have started as a
B2C product. Most of them are pivoted to enterprise application,
because they see that there is already a market there that they can
benefit from. At least to make a proof of concept for the enterprise
and prove themselves there, and then skip to the B2C site whenever
the mass adoption starts. But on the other side, from an enterprise
perspective, most of them already need solution providers and they
are not– maybe they were looking for some kind of normal
advertisement agency. They were approaching to their advertisement
agency, their usual film producer, production agency to create VR/AR
experiences. But they understand that if they want more than a
glorified POC, they have to actually reach the real VR/AR solution
provider or startup. So we are right now seeing the clear distinction
between the advertisement agency based VR/AR solution providers, and
the enterprise based VR/AR solution providers. Especially in Europe,
in Germany, what we have observed, the most successful startups — or
startup leaders, let’s say — is coming directly from the heart of
the enterprise, because they know how these big corporates work. They
know all the old-fashioned — maybe you can call it —
infrastructures work. And they are also aware that they have to find
a solution based on these IT infrastructures, without changing so
much on the IT infrastructures. Otherwise, it would create a lot of
decision making process longer or it will make a lot of commitment
from the corporate side, which is not easy from a startup
perspective. So I have realized that the startups with this kind of
enterprise knowledge, previous knowledge, they are the ones who
actually achieve to work directly with the corporates. And we also
see a lot of, of course, spinoffs from these corporates. They see one
niche enterprise XR application needs, and they actually spin off to
create the solution for the company that they have worked with.
Alan: What are some of the
solutions that you’re seeing that are driving the value now?
Ferhan: Yeah. Instead of maybe
the content related stuff, I think the navigation and also what I am
seeing right now is on the enterprise application side, there is a
lot of remote collaboration solutions right now, that is ramping up.
But still it is not easy to show this to the corporate or to a client
how it will work from their perspective. They can easily create a
prototype and make a very nice pilot program for maybe one seat, two
seats, five seats. But when you want to deploy this in the long run,
it always comes down to how to scale. And we have witnessed that most
of the startups who can tackle with this scaling challenge, are the
ones that is actually having much better success while working with
the clients.
Alan: So you also mentioned
something that’s really interesting to me, the fact that large
corporations are kind of spinning up teams, and this leads directly
into XR Bootcamp and the work you guys are doing. It almost seems
like enterprises have realized the value of virtual/augmented/mixed
reality technology — or XR — and they’re starting to spin up teams
in-house. What are some of the recommendations that you can give for
a company that wants to start an XR division or a team?
Ferhan: What we have seen is,
there is actually– this not only for VR/AR. This is usually in some
kind of a vicious cycle or a chicken-and-egg problem that we are
seeing right now. If I’m– let’s say I’m an evangelist in a large
corporation and I see that OK, for my learning development needs, I
would like to start the transformation towards VR/AR. Perfect. But
there is always a boss that I have to convince. So in order to
achieve that, I have to bring a demo to convince the decision makers,
the board, my boss, whatever, so that they will provide– allocate
some kind of budget for me. And then I’m going to an agency without
any budget telling them, “OK. Let’s create a demo. It should
look nice. It shouldn’t be maybe the whole experience. But I need to
have something to pitch to my boss, to my executive board,” and
then agency says “It is not possible, because you are not paying
it. And I don’t know if your boss will allocate money for the
upcoming potential project.” And since agency needs budget, I
cannot even create a demo showcase. From an internal capacity
perspective, this is actually a very unlucky situation and
disappointing situation for the people who would like to initiate
their first VR/AR deployment or pilot. And we believe that instead of
trying to find an agency, what if a company creates their own team of
VR/AR– we can call it maybe “VR/AR creation team” and then
they will be self-capable of creating at least demos or showcases for
convincing the bosses. OK? So in order to achieve that, you don’t
necessarily need to even hire new staff members, because hiring new
employees is always a problem, because it shows that you have to have
a long term commitment, etc. But you can easily tell to your own team
— or your own content creation team — to create a project for 2-3
hours per week, so that in the following weeks they can even create a
small prototype, or maybe you can create a Hecaton. But it all comes
down to how you will make your own engineers, your own designers,
your own developers become a creator of your XR learning demo, or
your XR app interface, or your XR club.
Alan: It’s interesting you say
that, Ferhan, because as you know, we spoke offline earlier about
what we’re working on. Part of what we’re working on behind the
scenes is enabling individuals web– just regular web developers the
ability to create spatial computing, and make that as easy as making
a website. And I think the tools are starting to come that will allow
anybody, in any organization to start making this content. And if you
look out even five years from now, the glasses will be super cheap.
They’ll be running on cloud and edge computing. So the processing
power will be distributed. And it really comes down to making
content, and making content fast and inexpensively, and democratizing
the content creation, in my opinion.
Ferhan: I totally agree.
Eventually– we already see a few examples, but it will become much
more seamless — or let’s say frictionless — from the developer
perspective or developer– we can call it a developer-friendly, and
we will see WordPress or Wix of VR/AR creation. So the most important
point here is, that is why we also concentrate on our upskilling
bootcamps, instead of trying to show tools — which it can change,
because if you have a WordPress or Wix or these kind of tools for VR,
you don’t necessarily need to know all the coding and knowledge or
all the details of the tools, because it would probably be intuitive
and developer-friendly — but understanding how to create an
immersive experience or how to even project the data to your AR
device on the right moment, to the right person, to the right eye is
more critical than explaining or teaching any tools on the market. Of
course Unity, Unreal, and these engines is already important to make
you enabled, which we strongly recommend if you already have a
commitment for VR/AR. But on the basic part, how to create a digital
reality and immersive strategy on your own company, how to create a
VR/AR demo for your company and so that you can convince your boss,
is much more important than other options, because now you become
self-capable of understanding how you can work with even the third
party providers.
Alan: Basically what you’re
doing is you’re enabling businesses to enable themselves.
Ferhan: Exactly. Self-capable,
self-capable.
Alan: Wonderful. [chuckles] OK,
so how can people find out more information? I know the website is
xrbootcamp.com. What do you have coming up in the next little bit
with XR Bootcamp?
Ferhan: So with the valuable
contribution of our advisory board, our board members include
important pioneers, like yourself. And in addition to that, we have
VR/AR managers from all the Accenture, BNP Paribas, KLM, Bosch, HTC
Vive. So all these people are coming together. We are actually
meeting quite often, every month. Even though all of out board
members are quite busy, they really give a lot of important. So I
would like to thank to all of our board members for their valuable
support. And we are actually designating the top skills requirement
of today and try to find the best matching modules, so that we can
add to XR Bootcamp program. Our bootcamp is starting on May and we
will have two paths. One is VR/AR full stack development. The other
is VR/AR full stack design. So you can select one of them. And the
first batch, it will be in Berlin. But in the upcoming batches, we
would like to actually use the opportunity of our network in both US,
Europe, and Asia with the help of our labs. We would like to deploy
the similar bootcamps with the similar industrial based curriculum on
different locations, based on the demand. So from a B2B perspective,
of course, when a company wants– a company may want to send one of
their employees, or a few of their employees to these bootcamps, or
if they would like to upskill all of their designers, developers,
engineers. We are also receiving applications for onsite bootcamp. So
deploying this similar industry based curriculum inside the company
for a few week long period.
Alan: So you have these things
coming up soon. You’ve got the ability to do this onsite for
companies that have larger teams that want to spin up. You’re going
to be running this in Berlin, but then in also North America as well.
I guess people can apply to be part of the XR Bootcamp at
xrbootcamp.com.
Ferhan: Yes.
Alan: And is there anything else
that you want to discuss about XR Bootcamp before we move on?
Ferhan: The most important part
that I would like to share: our normal bootcamp programs is– maybe I
can mention a little bit about the model here. The coding bootcamps
is quite popular around the world. As far as I know, there are over
300 coding bootcamp programs in US. Most of them are providing web
development, UI/UX design, product design, sometimes cybersecurity
bootcamps, which– some of them are quite good. What I’m seeing here
that the perception of upskilling is changing. Of course,
universities are still serving an important purpose to give you the
fundamentals of your own discipline. But from a bootcamp perspective,
there are still people who like access to this knowledge without
being part of a university. Since on a bootcamp you have– either you
have a full stack– sorry, a full day program, which is, you are
actually coming from morning till evening every day, it is three
months. But you can also have a after work program, which we call it
“part-time”, which you can actually finish the whole
program in six months. So what we have seen that people like to
access this kind of high-tech knowledge, even though they are not
coming from these disciplines, because as you can easily see, VR/AR
is something quite interesting for many people. And then you look at
from a professional perspective or from an employer perspective, if I
have a digital teaching project that I need maybe five people to
upskill, instead of finding VR/AR developers and giving them
engineering skills, I’m actually finding five engineers and
upskilling them on VR/AR development, which is easier than upskilling
on engineering background. So that is the exact thing that we are
right now focusing. And as I mentioned, for our onsite programs,
sometimes companies requires not the whole module itself, but some
specific parts. So we can actually shape it based on their needs,
since we have an modular program.
Alan: So Ferhan, what problem in
the world do you think we can solve or do you want to see solved
using XR technologies?
Ferhan: Yeah, so this is– this
is hard to answer. And if you are talking about today, my answers
will be different than if you are talking about in the long term,
because–
Alan: Let’s talk about today,
and let’s talk about 10 years out.
Ferhan: Okay. So today, I
believe VR is quite a meaningful tool to use, especially solving
today’s problems. Especially since we are talking about today, I
would expect from the enterprise side, I would like to see people
coming to their work or accessing to their– any kind of job
opportunity with the help of very nice training and onboarding
processes happening on VR/AR. So making the jobs — or even the jobs
that requires more skills — and making it accessible is quite
important. So making these jobs accessible through VR/AR development
is quite important from my perspective. Maybe you have heard as well.
The best onboarding is no onboarding, right? So in order to achieve
that, maybe you will just start your job today and then start already
contributing to your company, by just with the help of augmentation
or with the help of virtual/augmented reality tools. So this is the
world that I would like to see today and in the upcoming years, which
is already shaping up in some companies. And for the next ten years,
of course, we may think about a little bit like mass adoption on the
consumer level, and AR. We are part of Open AR Cloud. So I believe
that 10 years from now, we can see the implications and impact of AR
cloud. So VR/AR can also be part of our daily lives, and helping us
on any way possible. So I’m expecting that we don’t need to look at
screens anymore. So 10 years from now is screenless future that I’m
imagining.
Alan: That’s pretty cool.
Today’s focus is enterprise. Tomorrow is the mass market in a
screenless society. Well, Ferhan, thank you so much for taking the
time out of your busy schedule. How can people find you?
Ferhan: Yeah, xrbootcamp.com.
I’m happy to connect on LinkedIn, “Ferhan Ozkan”. If they
write, they will probably find me.
Alan: Awesome. Well, thanks
again, my friend. Have a wonderful day. And that has been the XR for
Business podcast.
Ferhan: Thank you.
27 min
March 17, 2020 Building an XR Vocabulary for Businesses, with XR Bootcamp’s Ferhan Ozkan
Code is a big part of what makes XR work, of course. But for most businesses, knowing the DNA of the technology will be less important than knowing how to best use it. XR Bootcamp co-founder Ferhan Ozkan is enabling businesses interested in XR to enable themselves.
Alan: Welcome to the XR for
Business podcast with your host, Alan Smithson. Today, we’re speaking
with Ferhan Ozkan, the co-founder of XR Bootcamp, a platform to teach
professionals how to create VR and AR applications, and support
companies to bridge their skills gap in XR development through an
intensive onsite program, cutting edge curriculum, and industry
renowned lecturers with a focus on industry portfolio projects. I am
personally very, very honored to be on the advisory board of XR
Bootcamp and helping them really develop the future of how
organizations will train their staff on how to build XR technologies.
And so with that, I’d love to welcome Ferhan to the show. Ferhan,
welcome to the show, my friend.
Ferhan: Hi, Alan. Pleasure to be
here. Thanks for inviting.
Alan: It’s absolutely my
pleasure. I just want to give you a little bit of history about you.
XR Bootcamp started from VR First, which was an organization bringing
VR labs into universities and colleges around the world. Is that
correct?
Ferhan: Yes. Yes. Back then —
almost four years ago — we started as VR First. The main mission was
to democratize VR and AR around the world. And you also supported us
on these times, because it was hard to find headsets as a developer,
as a startup. And we actually tried to tackle this problem with the
help of major headset manufacturers – Oculus, HTC, Leap Motion, Intel
— and they supported us to create VR/AR labs around the world. And
we are quite happy with the impact being created now, these labs are
actually really become big and creating amazing projects. And we are
actually proud to have this network and enable this network. Yeah, we
are now actually around 800 university that we can reach and over 400
startup clusters. But as a lab that we have supported and seeded —
as in equipment and other support — we reach to almost 52 labs. And
now we see that these labs become actually quite impactful in their
own region to create a regional VR/AR development scene, and VR/AR
startup and clusters, and they are even creating VR/AR programs —
academic programs — and industrial based trainings.
Alan: Ferhan, when did you guys
realize that bringing this type of knowledge into the enterprise was
the next step?
Ferhan: It is quite interesting,
because we talk with institutions not only in educational, but
government institutions. They reach to us after hearing about VR/AR.
“Can we educate the people in our health institutions? Can we
train the people, the employees that is actually working in the–
airport workers, like on the aviation industry?” And we
understood that there is actually already an initiative happening on
different parts of the world, on different industries based on each
government’s or each region’s industry focus. And then we decided,
“OK, what we can do first of all to start the VR/AR innovation
in each key destination?” So as I mentioned, seeding the
equipment was the first one. I remember in the beginning of 2017, we
had some kind of survey, and unfortunately for every 51 developer,
there was only one headset in any institution or in a startup
cluster. So think of like you want to create something, but you
cannot even access the VR headset, which is a shame for this region.
So we first of all started this seed equipment program, and then
training programs come afterwards. And the biggest supporters or
beneficiaries were actually the top enterprises in this local area,
from manufacturing to automotive, from aviation to defense industry.
And we would like to utilize all of these ecosystems like a startup
cluster. So from the institutional perspective, they can even help
creating a regional economy, with the help of science, parks,
education institutions, and the agile startups.
Alan: You’ve seen a lot of
startups in the industry kind of come– some of them have come and
gone. But what are you seeing as the major trend as we enter into
kind of 2020? VR and AR are starting to pick up steam. Companies are
starting to ask for– what are you seeing from startups now, that you
weren’t seeing a few years ago, that is really trending?
Ferhan: Yeah. I mean, this is a
question that I can answer differently in every year, because of the
rapid, crazy, evolving shape of the industry. But when we look ahead
— 2020 and 2021 — what I see personally is the startups are usually
creating platforms as a service. They just try to create their own
businesses based on their maybe previous experiences, their previous
business strategies. But they also see that it is not working like
that, especially on B2C side. And what I have realized that there are
many agencies, solution providers and startups who have started as a
B2C product. Most of them are pivoted to enterprise application,
because they see that there is already a market there that they can
benefit from. At least to make a proof of concept for the enterprise
and prove themselves there, and then skip to the B2C site whenever
the mass adoption starts. But on the other side, from an enterprise
perspective, most of them already need solution providers and they
are not– maybe they were looking for some kind of normal
advertisement agency. They were approaching to their advertisement
agency, their usual film producer, production agency to create VR/AR
experiences. But they understand that if they want more than a
glorified POC, they have to actually reach the real VR/AR solution
provider or startup. So we are right now seeing the clear distinction
between the advertisement agency based VR/AR solution providers, and
the enterprise based VR/AR solution providers. Especially in Europe,
in Germany, what we have observed, the most successful startups — or
startup leaders, let’s say — is coming directly from the heart of
the enterprise, because they know how these big corporates work. They
know all the old-fashioned — maybe you can call it —
infrastructures work. And they are also aware that they have to find
a solution based on these IT infrastructures, without changing so
much on the IT infrastructures. Otherwise, it would create a lot of
decision making process longer or it will make a lot of commitment
from the corporate side, which is not easy from a startup
perspective. So I have realized that the startups with this kind of
enterprise knowledge, previous knowledge, they are the ones who
actually achieve to work directly with the corporates. And we also
see a lot of, of course, spinoffs from these corporates. They see one
niche enterprise XR application needs, and they actually spin off to
create the solution for the company that they have worked with.
Alan: What are some of the
solutions that you’re seeing that are driving the value now?
Ferhan: Yeah. Instead of maybe
the content related stuff, I think the navigation and also what I am
seeing right now is on the enterprise application side, there is a
lot of remote collaboration solutions right now, that is ramping up.
But still it is not easy to show this to the corporate or to a client
how it will work from their perspective. They can easily create a
prototype and make a very nice pilot program for maybe one seat, two
seats, five seats. But when you want to deploy this in the long run,
it always comes down to how to scale. And we have witnessed that most
of the startups who can tackle with this scaling challenge, are the
ones that is actually having much better success while working with
the clients.
Alan: So you also mentioned
something that’s really interesting to me, the fact that large
corporations are kind of spinning up teams, and this leads directly
into XR Bootcamp and the work you guys are doing. It almost seems
like enterprises have realized the value of virtual/augmented/mixed
reality technology — or XR — and they’re starting to spin up teams
in-house. What are some of the recommendations that you can give for
a company that wants to start an XR division or a team?
Ferhan: What we have seen is,
there is actually– this not only for VR/AR. This is usually in some
kind of a vicious cycle or a chicken-and-egg problem that we are
seeing right now. If I’m– let’s say I’m an evangelist in a large
corporation and I see that OK, for my learning development needs, I
would like to start the transformation towards VR/AR. Perfect. But
there is always a boss that I have to convince. So in order to
achieve that, I have to bring a demo to convince the decision makers,
the board, my boss, whatever, so that they will provide– allocate
some kind of budget for me. And then I’m going to an agency without
any budget telling them, “OK. Let’s create a demo. It should
look nice. It shouldn’t be maybe the whole experience. But I need to
have something to pitch to my boss, to my executive board,” and
then agency says “It is not possible, because you are not paying
it. And I don’t know if your boss will allocate money for the
upcoming potential project.” And since agency needs budget, I
cannot even create a demo showcase. From an internal capacity
perspective, this is actually a very unlucky situation and
disappointing situation for the people who would like to initiate
their first VR/AR deployment or pilot. And we believe that instead of
trying to find an agency, what if a company creates their own team of
VR/AR– we can call it maybe “VR/AR creation team” and then
they will be self-capable of creating at least demos or showcases for
convincing the bosses. OK? So in order to achieve that, you don’t
necessarily need to even hire new staff members, because hiring new
employees is always a problem, because it shows that you have to have
a long term commitment, etc. But you can easily tell to your own team
— or your own content creation team — to create a project for 2-3
hours per week, so that in the following weeks they can even create a
small prototype, or maybe you can create a Hecaton. But it all comes
down to how you will make your own engineers, your own designers,
your own developers become a creator of your XR learning demo, or
your XR app interface, or your XR club.
Alan: It’s interesting you say
that, Ferhan, because as you know, we spoke offline earlier about
what we’re working on. Part of what we’re working on behind the
scenes is enabling individuals web– just regular web developers the
ability to create spatial computing, and make that as easy as making
a website. And I think the tools are starting to come that will allow
anybody, in any organization to start making this content. And if you
look out even five years from now, the glasses will be super cheap.
They’ll be running on cloud and edge computing. So the processing
power will be distributed. And it really comes down to making
content, and making content fast and inexpensively, and democratizing
the content creation, in my opinion.
Ferhan: I totally agree.
Eventually– we already see a few examples, but it will become much
more seamless — or let’s say frictionless — from the developer
perspective or developer– we can call it a developer-friendly, and
we will see WordPress or Wix of VR/AR creation. So the most important
point here is, that is why we also concentrate on our upskilling
bootcamps, instead of trying to show tools — which it can change,
because if you have a WordPress or Wix or these kind of tools for VR,
you don’t necessarily need to know all the coding and knowledge or
all the details of the tools, because it would probably be intuitive
and developer-friendly — but understanding how to create an
immersive experience or how to even project the data to your AR
device on the right moment, to the right person, to the right eye is
more critical than explaining or teaching any tools on the market. Of
course Unity, Unreal, and these engines is already important to make
you enabled, which we strongly recommend if you already have a
commitment for VR/AR. But on the basic part, how to create a digital
reality and immersive strategy on your own company, how to create a
VR/AR demo for your company and so that you can convince your boss,
is much more important than other options, because now you become
self-capable of understanding how you can work with even the third
party providers.
Alan: Basically what you’re
doing is you’re enabling businesses to enable themselves.
Ferhan: Exactly. Self-capable,
self-capable.
Alan: Wonderful. [chuckles] OK,
so how can people find out more information? I know the website is
xrbootcamp.com. What do you have coming up in the next little bit
with XR Bootcamp?
Ferhan: So with the valuable
contribution of our advisory board, our board members include
important pioneers, like yourself. And in addition to that, we have
VR/AR managers from all the Accenture, BNP Paribas, KLM, Bosch, HTC
Vive. So all these people are coming together. We are actually
meeting quite often, every month. Even though all of out board
members are quite busy, they really give a lot of important. So I
would like to thank to all of our board members for their valuable
support. And we are actually designating the top skills requirement
of today and try to find the best matching modules, so that we can
add to XR Bootcamp program. Our bootcamp is starting on May and we
will have two paths. One is VR/AR full stack development. The other
is VR/AR full stack design. So you can select one of them. And the
first batch, it will be in Berlin. But in the upcoming batches, we
would like to actually use the opportunity of our network in both US,
Europe, and Asia with the help of our labs. We would like to deploy
the similar bootcamps with the similar industrial based curriculum on
different locations, based on the demand. So from a B2B perspective,
of course, when a company wants– a company may want to send one of
their employees, or a few of their employees to these bootcamps, or
if they would like to upskill all of their designers, developers,
engineers. We are also receiving applications for onsite bootcamp. So
deploying this similar industry based curriculum inside the company
for a few week long period.
Alan: So you have these things
coming up soon. You’ve got the ability to do this onsite for
companies that have larger teams that want to spin up. You’re going
to be running this in Berlin, but then in also North America as well.
I guess people can apply to be part of the XR Bootcamp at
xrbootcamp.com.
Ferhan: Yes.
Alan: And is there anything else
that you want to discuss about XR Bootcamp before we move on?
Ferhan: The most important part
that I would like to share: our normal bootcamp programs is– maybe I
can mention a little bit about the model here. The coding bootcamps
is quite popular around the world. As far as I know, there are over
300 coding bootcamp programs in US. Most of them are providing web
development, UI/UX design, product design, sometimes cybersecurity
bootcamps, which– some of them are quite good. What I’m seeing here
that the perception of upskilling is changing. Of course,
universities are still serving an important purpose to give you the
fundamentals of your own discipline. But from a bootcamp perspective,
there are still people who like access to this knowledge without
being part of a university. Since on a bootcamp you have– either you
have a full stack– sorry, a full day program, which is, you are
actually coming from morning till evening every day, it is three
months. But you can also have a after work program, which we call it
“part-time”, which you can actually finish the whole
program in six months. So what we have seen that people like to
access this kind of high-tech knowledge, even though they are not
coming from these disciplines, because as you can easily see, VR/AR
is something quite interesting for many people. And then you look at
from a professional perspective or from an employer perspective, if I
have a digital teaching project that I need maybe five people to
upskill, instead of finding VR/AR developers and giving them
engineering skills, I’m actually finding five engineers and
upskilling them on VR/AR development, which is easier than upskilling
on engineering background. So that is the exact thing that we are
right now focusing. And as I mentioned, for our onsite programs,
sometimes companies requires not the whole module itself, but some
specific parts. So we can actually shape it based on their needs,
since we have an modular program.
Alan: So Ferhan, what problem in
the world do you think we can solve or do you want to see solved
using XR technologies?
Ferhan: Yeah, so this is– this
is hard to answer. And if you are talking about today, my answers
will be different than if you are talking about in the long term,
because–
Alan: Let’s talk about today,
and let’s talk about 10 years out.
Ferhan: Okay. So today, I
believe VR is quite a meaningful tool to use, especially solving
today’s problems. Especially since we are talking about today, I
would expect from the enterprise side, I would like to see people
coming to their work or accessing to their– any kind of job
opportunity with the help of very nice training and onboarding
processes happening on VR/AR. So making the jobs — or even the jobs
that requires more skills — and making it accessible is quite
important. So making these jobs accessible through VR/AR development
is quite important from my perspective. Maybe you have heard as well.
The best onboarding is no onboarding, right? So in order to achieve
that, maybe you will just start your job today and then start already
contributing to your company, by just with the help of augmentation
or with the help of virtual/augmented reality tools. So this is the
world that I would like to see today and in the upcoming years, which
is already shaping up in some companies. And for the next ten years,
of course, we may think about a little bit like mass adoption on the
consumer level, and AR. We are part of Open AR Cloud. So I believe
that 10 years from now, we can see the implications and impact of AR
cloud. So VR/AR can also be part of our daily lives, and helping us
on any way possible. So I’m expecting that we don’t need to look at
screens anymore. So 10 years from now is screenless future that I’m
imagining.
Alan: That’s pretty cool.
Today’s focus is enterprise. Tomorrow is the mass market in a
screenless society. Well, Ferhan, thank you so much for taking the
time out of your busy schedule. How can people find you?
Ferhan: Yeah, xrbootcamp.com.
I’m happy to connect on LinkedIn, “Ferhan Ozkan”. If they
write, they will probably find me.
Alan: Awesome. Well, thanks
again, my friend. Have a wonderful day. And that has been the XR for
Business podcast.
Ferhan: Thank you.
27 min
March 10, 2020 Enhancing the Hospitality Experience in XR, with UgoVirtual’s Michael C. Cohen
Today’s guest — UgoVirtual’s Michael Cohen — describes the hospitality industry like a snowflake – add a little heat and, well, you can imagine. Hotels and cruises rely on proven practices to keep guests happy. Luckily, XR doesn’t have to disrupt those practices; they can build on top of them.
Alan: Coming up next on the XR
for Business podcast, we have Michael Cohen from UgoVirtual. We’re
going to be talking about how virtual/augmented/mixed reality
solutions — or XR solutions — can be used for front-of-house for
customer facing activations, from AR to VR. Pre-experiences, what is
it like to book this hotel, looking all around you? And also the
back-of-house: how do we use this technology to give the best
possible training for the staff, so that the customer experience is
flawless across the board? All that and more coming up, on the XR for
Business podcast, coming up next. Michael, welcome to the show, my
friend.
Michael: Thank you very much.
Really appreciate it, Alan.
Alan: It’s my absolute pleasure.
It’s been a long time coming. We’ve been kind of doing the dance,
watching each other grow. And I’m really excited to learn about what
you guys are doing in the hospitality field. It feels like it’s a
greenfield opportunity in hospitality, from travel/tourism. A bunch
of companies started with, “We’re going to put a 360 camera and
let you have a virtual tour.” But explain to us, what are you
doing at UgoVirtual, and what is the response so far in the
hospitality industry?
Michael: Well, first of all,
timing is everything, as we know. [chuckles] And the global travel
and hospitality industry is absolutely a greenfield opportunity. It’s
primed for scale and expansion in regards to XR. The reason being is
that there have been investments and there have been initiatives,
both on the brand and enterprise level of hospitality and travel
companies, but also in startups and larger companies who have
enabled, let’s call it a slice of VR or a slice of AR. Or as you
mentioned, enabled OK 360 hotel tours that were maybe derivative out
of the real estate market and that sort of scenario. Now, the
opportunity is very, very serious for UgoVirtual, because we are the
travel and hospitality virtual solutions company, very myopically
focused to both consult to the major travel and hospitality brands to
help them navigate and make investments and strategic decisions for
the next three, four, five years on what XR will be for them.
And also from our perspective, we have
a portfolio of XR oriented solutions that are very focused and linear
to the travel and hospitality space. So we’re not taking generic
solutions and trying to overlay them on travel and hospitality. The
group that’s involved with UgoVirtual — who I’m a strategic advisor
to — we’re all 15-20 year veterans on hospitality technology
commercialization for the front-of the house, which is guest facing
solutions and the back-of-the-house, which is employees and staff. So
when you overlay that kind of multi-decade experience on how to get
technology efficiently deployed, efficiently commercialized, exceed
the demands or the needs of travel and hospitality brands, with these
now slowly maturing VR/AR/XR opportunities, it’s a wonderful fit for
UgoVirtual right now.
Alan: So give us an example. You
talked about front-of-house, customer facing solutions. Let’s start
with front-of-house and then we’ll go back-of-house. Because I don’t
know if you know this, but I actually met my wife working at Delta
Hotels in Toronto.
Michael: [chuckles] That’s
perfect.
Alan: Yeah.
Michael: Yeah.
Alan: I was a bartender, and she
was the night manager–
Michael: That sounds like a
great novella right there. But that’s for another day.
Alan: [chuckles] It sure is.
Let’s talk front-of-house. What’s going on there?
Michael: Here’s the reality
about hospitality specifically and hotels, let’s be more even
granular. There’s obviously a massive investments of travel and
hospitality startups that are geared towards mobility, they’re geared
towards guest engagement, the guest experience, the ability for
guests to use their own BYOD smartphones to interact and to
experience property or a destination, for example. So there’s been
millions and millions of dollars invested — both at the brand level
and also at the vendor level — to enable mobile, for example. So
things like — I don’t know — mobile key access to rooms, brand
apps, et cetera.
Where UgoVirtual has identified a
couple of years ago and has been investing into initiatives, is the
virtualization of those type of experiences, the enhancements, the
scalability of those types of engagement experiences such as
virtualized hotel tours, deep virtual tours. They don’t require
headsets. They don’t require Hololens 2 for the consumer, but the
consumer through their mobile device, their tablet or at home,
through our solutions, through our virtual hotel tours that we are
fully rolling out in January of 2020. And we have some beta sites
already deployed all across North America. UgoVirtual hotel tours
solutions are very deep. They’re very much about the flow through a
hotel, experiencing the hotel, versus simply a 360 camera and some
sort of images.
The reason being is that hoteliers have
consistently over decades invested so much in the experiential design
and the look and feel and the feature function of their properties.
It’s an incredibly competitive market, like many other vertical
markets. And their investments in new builds and renovations are
massive and substantial. But this is all about the pre, the present,
and the post. The pre-virtualization of a guest experience. The
pre-experience of what it will be like to book this hotel, or book
their convention in this convention hotel, or book their meeting in
the meeting space, etc. is a massive benefit of what we call
hospitality XR from the front-of-the-house. And those are things that
we feel have been — in a limited fashion — enabled in the travel
and hospitality vertical.
But now we’re bringing out these
solutions that are far deeper, far richer, based upon technology that
you and I and others in industry know very well. But it’s all about
execution. So one major area is definitely the pre-virtualization of
travel or accommodations, so that consumers and the guests —
passengers of a cruise ship, for example — they have the ability to
differentiate and to make decisions on where they’re going to build
their travel itineraries, who they’re going to make their
reservations with, who they’re going to purchase services from.
That’s a massive opportunity that we’re very focused on executing in
the travel and hospitality space. That’s one major area of the
front-of-the-house.
The other area of the
front-of-the-house that we’re rolling out in 2020 as well is the
augmented reality experience within the guest room and the public
spaces of hotels or convention centers, etc. And we have invested and
are rolling out particular technologies that replace a lot of the
traditional content, printed content, even some of the digital
content that has been invested in by brands or travel destinations
over the last five, six, seven years, to make it a far more seamless
augmented reality digital overlay on the skin of the hotel or the
destination. That’s another area that you know well what I’m talking
about, and I’m sure the listeners do as well. Taking this augmented
reality interaction, these activations and actually focusing them on
the guest room. So we’ll be making announcements in January, February
on our next range of augmented reality solutions for hotels.
And then the last scenario that we very
much have commercialized and we’re rolling out is the virtualization
of events within the travel and hospitality space. But the reality is
that like any other vertical market industry, there’s a wide array of
industry events, of vendor events, of organization events that you
and I travel to many times, in many ways, in different verticals.
Well, we have a technology that we’ve commercialized over the last 18
months and we’ve already landed and are deploying multiple
virtualized events of brick and mortar exhibitors. And these are
industry related events in our space. There are organizational events
and there are also the vendor conferences for — for example —
hospitality technology vendors, who may have a conference every two
years because it’s incredibly expensive, quite challenging in regards
to bandwidth and time for the attendees and the vendors or the
speakers. So they may have these events every two years. Well, with
UgoVirtual virtualized events, they can have those events every year.
One year virtual, one year brick and mortar. And that’s really been a
major push crush. And we’ve had a lot of positive feedback on that as
well.
Alan: Watching the video, you’ve
basically created a system where you can have a virtual trade show,
looks like. And virtual meetings.
Michael: That’s exactly what it
is. Exactly.
Alan: So that’s not necessarily
in VR. I mean, you’re doing that on 2D screens. And so how is that
working out? What’s some of the response with that?
Michael: Well, we’ve generated a
lot of revenue, and we have multiple events signed and we’re rolling
them out in 2020. So I guess that’s the ultimate feedback from the
industry, is that people like us, they really like us, as Oscar
winners have said in the past. [chuckles] So, I mean, you can have a
vision, you can have an idea. If you’re executing in a vacuum, it’s
one thing. But when you’re executing and getting positive
reinforcement, and actual industry players are signing contracts and
investing in virtualizing their events, that’s the ultimate feedback
you can expect. And we’re still in a bit of a soft launch, because we
want to make sure that we’re executing very, very strongly on these
events. But the opportunity to go wide is really there, because
here’s the reality.
There are three areas of the travel and
hospitality industry globally where virtualized events from
UgoVirtual make a ton of sense. One is, obviously, our vertical
market industry organizations. There’s organizations called HTNG, for
example, that’s Hospitality Technology Next Generation. There’s
organizations called HFTP, which is the Hospitality, Finance and
Travel Professionals. These are — like any vertical market — these
are major organizations where we’re all members, and it’s an
important part of our careers. It’s an important part of training and
networking. And they all have very large user groups and work groups
and so on. So we are looking to talk to those people and move their
events — which we are all members of — to a virtual scenario
because you have an ability to expand reach, expand awareness, drive
actual interactivity between members of an organization or a vertical
market.
Because not everybody can travel to New
Orleans or travel to LA or travel to Monte Carlo. Not everyone can do
that. And no-one has the level in their career as an executive or a
decision maker, or they don’t have the bandwidth, or they don’t have
the travel budget. And secondarily and very importantly, what we’re
doing is also — as many of the people you interview — it’s also
green. This is a sustainability play, too. The ability to have more
events append existing brick and mortar events with UgoVirtual
virtualized event as a sister to the existing event is really
impactful from a sustainability perspective as well. Carbon
footprint, all those good thing.
Alan: Let’s shift focuses now to
the back-of-house. What are some of the solutions that you guys are
providing for back-of-house?
Michael: So in the back-of-house
space, we’re also a consulting firm, as I mentioned earlier. So we’re
focusing on assisting hospitality and travel brands on their strategy
for their employees, for their training scenarios, for optimization
of their back-of-house, human infrastructure. The reality of travel
and hospitality– And you were– now that you mentioned it, you
worked in this space. You know that turnover is massive. And that’s a
big challenge for hospitality brands, and ownership groups of hotels,
and conventions, and other scenarios. The turnover is massive. And
therefore, when that happens, a lot of the intellectual IP of how to
do what you need to do and your job in a hotel or in a conference
center or another hospitality entity, it evaporates. So there’s this
constant requirement for new hiring and training.
So taking the massive growth and impact
that virtual reality training is enacting in major North American and
global enterprise — as well as other vertical markets — we’re
bringing that to hospitality. So the back-of-the-house for us is very
much focused on VR and augmented reality training. So we’re
consulting with firms and we have relationships with the Microsoft
team in regards to Hololens 2, the HP team and their scenario. We’re
talking to Lenovo and many, many others who have both the hardware
and the cloud based infrastructure, so that hospitality and travel
companies can utilize this infrastructure, these tools to create
their own content, to be able to have a far more efficient, higher
retention and tremendous ROI on their training and back-of-the-house
staff. So that’s one area.
Another area that we’re involved in —
from an augmented reality perspective, in a product and deployment
solution — is creating the augmented reality overlays to the
physical plant of hotels or convention centers or mixed development
properties. The engineering manager of Hotel X been there for 15
years. He knows that the only way to get the boiler in the boiler
room to really kick in on the coldest day of the winter is you’ve got
to kick it twice and you’ve got to turn the lever to the right. He
leaves, he retires. That is gone. That knowledge is gone. I’m using a
very simplistic example, as you can imagine. But when you have an
ability to deploy a PIN code protected augmented reality overlay next
to the boiler, that has all this data, all this intellectual property
— knowledge — that’s permanently affixed in an augmented reality
scenario next to the boiler, it’s now there for the future. All
future employees or anyone who needs to have this information
available on the fly. So we are working on the back-of-house, as
well.
Alan: Kick twice and go down to
the back. [laughs]
Michael: Yeah. I mean,
obviously, when I’m using– I’m being pejorative and using a
simplified– but you know exactly what I’m talking about. And you’ve
seen it. And– I mean, listen, this is not always about inventing
something. It’s about taking best of breed solutions that are in
industrial and other enterprise scenarios, and overlaying it on a
very competitive, a very lucrative business called travel and
hospitality.
Alan: Well, it’s interesting.
Oil and gas companies have been doing this for a few years now.
Microsoft has really focused on enterprise. But when you see
“enterprise”, you think oil and gas, mining, construction.
But travel and tourism is an enterprise. Any group of companies where
you have millions of employees is an enterprise. So what are some
specifics? Like, what companies are rolling this out? What are what
are you seeing results wise? Is there any specifics you can share?
Michael: Sure. I mean, let’s
talk about on the front-of-house side of things. So Best Western,
about two to three years ago — major brand, huge portfolio of owner
managed hotels — made a mandate in order to roll out virtual hotel
tours to each of their Best Western properties. And it was well
accepted. It was a very good first major move. They’re one of the
first movers in the industry. It’s more of a 360 real estate type
experience, but it’s absolutely adequate and it has been adequate for
that period of time. And there’s been other brands that are more in
the boutique and independent luxury space, who have definitely done
the same. Where there is a next gen or next level is in regards to
really making these virtualized tours — like we are doing at
UgoVirtual — far more — what’s the word? — impactful and engaging,
and integrating them into different systems.
When you have a UgoVirtual tour of a
hotel, and you can embed in the actual booking of a hotel room from
one you’re– while you’re in the tour, or booking of a meeting space
through the RFQ interface of another system right within the tour. As
you know, engagement and activity. So that’s really where the next
level of what we’re doing in regards to the hotel tours. But listen,
Marriott has made investments. Hilton’s made investments. All the
major brands have had different levels of interaction in regards to
the tours. And we’re looking to — what’s the word? — maybe
aggregate some of that demand and bring out a very consistent,
deeper, richer, virtualized experience there. In regards to augmented
reality in the guestroom, the big, big push and the big deployments
have been different types of app-based or appless content and
interactive solutions in hotels.
I will say that we are in the early
stages, and our timing is great in regards to the augmented reality
overlay within hospitality. That is — again — an evergreen
opportunity. There has not been a massive amount of guestroom related
implementations. That’s why we feel we have a tremendous first mover
advantage and during our announcements in early parts of 2020, we’re
going to make sure we make the most of that impact. But what I will
say in regards to augmented reality in hospitality, there’s been a
lot of very successful activations by people like Foxwoods, casinos
and hotels, and other forward thinking brands and travel companies,
who have used it as more promotional and a way to do gamification
around their property, to have the guests or the consumers move
through the property to — for example — have a digital hunt where
you’re looking for different symbols or you need to collect the
activations of 12 different photos of Big Papi — former Boston Red
Sox, a DH — who’s obviously an ambassador for Foxwoods, for example.
So you have to go through the hotel and
you have to find all of the photos of Big Papi, and then use your
phone and activate the augmented reality experience. And when you do,
you get a bonus offer or you get points or you get a gift. So that’s
been really successfully rolled out in hospitality. And there’s the
beginnings of what we’re also involved in, is the AR activations for
the exterior of the buildings. So you’ve seen this in major brands in
the consumer packaged goods and consumer product space for using
these major neural activations. Well, that is starting to trickle
into the hospitality as well. Because these are buildings, and these
are buildings and resorts and convention centers, which have a ton of
external real estate — if you know what I’m saying — that the
activations of AR experiences are starting to trickle into there, as
well. And we’re involved in that, too.
Alan: It sounds like you guys
get your fingers and everything to do with XR and hospitality.
Michael: We’re focused still,
I’ll be honest, because we’re not a custom development shop, per say.
Yes, we’re a hospitality XR consulting company, for sure. But we have
selected and have invested in specific lines of business and
solutions, that we feel have the most opportunity for travel and
hospitality. One thing that’s really important, Alan, I think for
this conversation is yes, were a startup and in growth mode, for
sure. And we have interest from various parties to help us with our
growth. But we’re not– I’m not looking to belittle the traditional
startup cycle, but we are overlaying hospitality XR both for the
product and service to space and as consultants on the realities of
commercializing technology in travel and hospitality industry. We
know the budget seasons, the line items, how the widgets have to be
positioned from a commercialization and business model space.
That’s incredibly important, because
what we’re doing is we’re doing our own proprietary and we have
exclusive licensing on a range of technologies that we’re
commercializing globally in travel and hospitality. But we are
overlaying our own technology or licensed technology on existing
business models, that have been proven and are required over the last
30 years. And that is a big differentiator here, because as you know,
it’s hard enough to get buy-in authorities or C level folks to engage
and get behind a new technology. But if the business model or the
commercialization plan doesn’t align with what they’re used to, it’s
even another challenge. We have absolutely met that and exceeded that
scenario, because we know how to put the square peg in the round
hole, and roll out the technology in a way commercially that is both
viable, scalable, but also understandable to travel and hospitality
executives.
Alan: So if you’re speaking–
let’s say– assume that somebody from the industry is listening to
this podcast, what’s step 1 for them?
Michael: Well, step one for them
is– first of all, if you’re listening to the podcast, we appreciate
it. [chuckles] And second of all is, they’re digesting a lot of
information. There is a firehose that’s being blown into the travel
and hospitality space — like many other vertical markets, enterprise
markets — that these executives know they have to get on board. They
have to start crystallizing their strategy and their visions on how
in our industry hospitality XR — hopefully through UgoVirtual — is
enabled within their brands and their properties and their
destinations. So they’re already investigating. They’re already
collecting information. They’re reading, they’re watching. The goal
is there needs to be an alignment of this technology with what’s the
successful principles of their business. From our perspective– and
that’s why we’ve opened the consulting side of the business, because
we’re there to help them align those two important areas.
And then obviously, they need to
investigate what is the appropriate next steps if they’re interested
in front-of-the-house hospitality XR. What sort of areas or what sort
of feature function or benefits they want to achieve? What sort of
enhancements do they want to append to their existing successful
guest engagement scenarios? And those are things that have to be laid
out. And then they would talk to people like us, to help them
organize that, but also just to see what’s available in regards to
technologies that they can license, technologies that are scalable.
One thing you have to remember is that
in the major travel and hospitality brands, either destinations or
resorts or hotels or Disneys of the world, everything’s a thousand
points of light. It’s usually not one property or one destination. In
the enterprise side of travel, hospitality, it’s hundreds. It’s
thousands. There’s 14, 15, 16,000 hotels in North America, for
example. There’s hundreds and hundreds and hundreds of thousands of
guest rooms all over the world. That’s a big consideration. That’s a
differentiator from other industries. Yes, of course they have 200
locations, or they may have 50 training centers. These are all really
major accommodations that require a lot of planning a ticket to an
exponential level with travel and hospitality. That’s a critical,
important part of the successful identification, research, rollout,
and execution on hospitality XR: the thousand points of light. It
could be 50 points of light, could be a 1,000 points of light. But
that’s really important.
Alan: Let’s talk about– I do
want to bring up one company in particular, because they kind of been
flying under the radar. What are your thoughts on a company called
Oyo, who — from what I’ve heard — now are the number two hotel
chain in the world?
Michael: So we can have this
conversation regardless of hospitality XR, because this is really
important. So Oyo has a business model and has a system in place and
they’ve come out of Southeast Asia and Ritesh [Agarwal], their owner,
is a very dynamic CEO and he has major funding from Softbank, so he
has taken the traditional hospitality business methodology and he’s
put it on its head into almost like a technologies solutions company.
So there are great opportunities, great growth, but there are also
great challenges that they are facing. Hotels are hard. Every hotel
is a snowflake. It’s very challenging to scale traditional
hospitality surfaces, traditional hospitality technology, a server,
access points, IOT sensors, hardware. It’s challenging to roll that
out, because there are different configurations, different designs,
and different systems in place in every hotel in the world.
Alan: Oh, I know. Wi-Fi. Listen,
the hotel people that are listening to this: please, if you’re going
to work on one thing, Wi-Fi that works universally.
Michael: No, Alan, I mean, the
point is — you know this, I’m going to bring this back to our
conversation — is the consistency and the quality of Wi-Fi. I was–
I have been involved in Wi-Fi commercialization in travel and
hospitality for 15 years. And I worked with AT&T and other
leading hospitality Wi-Fi companies for many, many years. So I’m a
bit of an expert, barely stayed up at this one, I could say. And
you’re absolutely right. It’s a critical juncture. It’s like oxygen
for a hotel, because if the Wi-Fi is not consistent and the quality
is not there and the coverage is not there, it’s a real impact to the
guest satisfaction scores of hotels. And this is a good segue back
into what we were talking about.
Two things: guest engagement, guest
experience. So it’s front-of-the-house again. That’s where
UgoVirtual– and that’s where the virtualized and augmented reality
solutions that we’re bringing out, and the hospitality XR consulting
that we’re we’re delivering is key. Because this tsunami of XR that’s
going global, which you are a world expert at– and you know I’m not
kissing your behind, because I know who you are, we’re friends. And I
know the impact that you’re making around the world, and all the
travel that you do, and all the events you go to. So the tsunami of
XR in all different types of business and enterprise, it has its
place in travel and hospitality vertical. But what’s mission
critical, it’s not only about revenue and the retail environment,
it’s about optimization. It’s about revenue per square foot. It’s
about making sure that each aisle is activated in a way that can
drive more products to sell.
In hospitality, if you mess with the
guest experience, you’re in deep trouble. So the ability to
efficiently and intelligent roll out hospitality XR in our vertical
is incredibly delicate and also incredibly important. Guest
satisfaction scores are the cornerstone of a lot of the metrics in
general about hospitality. So that’s really critically important. But
second to that is, let’s talk about connectivity and let’s talk about
wireless connectivity.
Back to the Wi-Fi scenario. Wi-Fi 6,
5G. You know this, we’ve talked about this in the general sense, but
in hospitality and travel, it’s even more paramount. Because you have
massive concentrations of guests, passengers, consumers who are on
present — so this is the present part of UgoVirtual’s strategy —
they’re on premise. They’re interacting with the property, the
destination or the cruise ship. Any solution that’s deployed by us at
UgoVirtual — or anybody else in hospitality XR space — needs to
have seamless connectivity to make sure that experience is 100
percent, because if it’s not a 100 percent because the connectivity
is off, there you have the guest satisfaction challenges again. So 5G
and Wi-Fi 6 is the massive enabler to this next generation of
front-of-the-house and back-of-the-house solutions for travel and
hospitality. It’s a critical part of the success methodology for it.
Alan: Well, Michael, I really
want to thank you so much for taking the time to explain how XR is
going to be used for hospitality. If you look at just from the lens
of training people, I mean, that alone is a massive opportunity for
hotels. When I was in hotels, the training was not that great then.
And it really hasn’t improved since then. So being able to give
people the opportunity to train at a higher level, before they even
step foot into a property, I think is a really great opportunity for
these organizations.
Michael: There’s two quick
things I want to add — if I could — to that from the
back-of-the-house perspective and I’ll be brief, is in our industry
— like many others — the SOPs, the Standard Operating Procedures
are mission critical. And like you know, we know, but maybe not
everyone knows who’s listening to this. People like Wal-Mart and
FedEx and other major companies have made reasonable corporate
investments in VR training, for example. And they have realized
exponential ROI. Is that fair to say, Alan?
Alan: Yes. At least 10x what
they’ve put in.
Michael: Correct. I wanted you
to say 10x, because I don’t want to be the hypester. You’re the
expert. So what I’m getting at is in hospitality, the ability to
pre-qualify, pre-identify through the actual HR process of potential
back-of-the-house staff to interact in the actual experience of
implementing standard operating procedures and certain tasks — at a
hotel or a conference center or a cruise ship, for example — is
amazing, because you actually have ability to cull down to the best
cohort of your applicants and then you can get them into the company
and then you can train them very efficiently. As we know, with VR
training, you have higher retention, shorter training cycles and
major ROI. I mean, those are– that’s a winning scenario. That’s
really important. So the combination of SOPs with VR training and
working with brands and working with travel companies from a
UgoVirtual perspective, so they understand how to implement that on
the back-of-the-house is definitely part of our mandate and our
mission.
Alan: I’m really excited for the
future of what you guys are working on. And I’ll end on a quick
story.
Michael: Sure.
Alan: You know how Marriott
introduced VR room service, like VRoom service? So we actually
pitched them on that, and they took the idea and built it, and then
sent us one. So we got this briefcase where it was like a Gear VR and
a phone. And it’s like, “Look, VR room service!” I’m like,
“Oh, great, thanks.”
Michael: [laughs]
Alan: I was like, “Oh well,
it was a good idea.” But yeah, the hotels are really
experimenting with these things and it’s exciting. And hotels,
restaurants, everybody will be impacted by it. So thank you again for
taking the time to share this vision. Where can people find
UgoVirtual?
Michael: Sure. It’s
ugovirtual.com, and in LinkedIn just search for “ugovirtual.com.”
And we are the travel and hospitality virtual solutions company.
Alan: Thanks so much, my friend.
Michael: Alan, a pleasure. And
look forward to seeing you in the future at the next major event.
Thank you for this time today. Appreciate it.
Alan: Sounds good.
34 min
March 10, 2020 Enhancing the Hospitality Experience in XR, with UgoVirtual’s Michael C. Cohen
Today’s guest — UgoVirtual’s Michael Cohen — describes the hospitality industry like a snowflake – add a little heat and, well, you can imagine. Hotels and cruises rely on proven practices to keep guests happy. Luckily, XR doesn’t have to disrupt those practices; they can build on top of them.
Alan: Coming up next on the XR
for Business podcast, we have Michael Cohen from UgoVirtual. We’re
going to be talking about how virtual/augmented/mixed reality
solutions — or XR solutions — can be used for front-of-house for
customer facing activations, from AR to VR. Pre-experiences, what is
it like to book this hotel, looking all around you? And also the
back-of-house: how do we use this technology to give the best
possible training for the staff, so that the customer experience is
flawless across the board? All that and more coming up, on the XR for
Business podcast, coming up next. Michael, welcome to the show, my
friend.
Michael: Thank you very much.
Really appreciate it, Alan.
Alan: It’s my absolute pleasure.
It’s been a long time coming. We’ve been kind of doing the dance,
watching each other grow. And I’m really excited to learn about what
you guys are doing in the hospitality field. It feels like it’s a
greenfield opportunity in hospitality, from travel/tourism. A bunch
of companies started with, “We’re going to put a 360 camera and
let you have a virtual tour.” But explain to us, what are you
doing at UgoVirtual, and what is the response so far in the
hospitality industry?
Michael: Well, first of all,
timing is everything, as we know. [chuckles] And the global travel
and hospitality industry is absolutely a greenfield opportunity. It’s
primed for scale and expansion in regards to XR. The reason being is
that there have been investments and there have been initiatives,
both on the brand and enterprise level of hospitality and travel
companies, but also in startups and larger companies who have
enabled, let’s call it a slice of VR or a slice of AR. Or as you
mentioned, enabled OK 360 hotel tours that were maybe derivative out
of the real estate market and that sort of scenario. Now, the
opportunity is very, very serious for UgoVirtual, because we are the
travel and hospitality virtual solutions company, very myopically
focused to both consult to the major travel and hospitality brands to
help them navigate and make investments and strategic decisions for
the next three, four, five years on what XR will be for them.
And also from our perspective, we have
a portfolio of XR oriented solutions that are very focused and linear
to the travel and hospitality space. So we’re not taking generic
solutions and trying to overlay them on travel and hospitality. The
group that’s involved with UgoVirtual — who I’m a strategic advisor
to — we’re all 15-20 year veterans on hospitality technology
commercialization for the front-of the house, which is guest facing
solutions and the back-of-the-house, which is employees and staff. So
when you overlay that kind of multi-decade experience on how to get
technology efficiently deployed, efficiently commercialized, exceed
the demands or the needs of travel and hospitality brands, with these
now slowly maturing VR/AR/XR opportunities, it’s a wonderful fit for
UgoVirtual right now.
Alan: So give us an example. You
talked about front-of-house, customer facing solutions. Let’s start
with front-of-house and then we’ll go back-of-house. Because I don’t
know if you know this, but I actually met my wife working at Delta
Hotels in Toronto.
Michael: [chuckles] That’s
perfect.
Alan: Yeah.
Michael: Yeah.
Alan: I was a bartender, and she
was the night manager–
Michael: That sounds like a
great novella right there. But that’s for another day.
Alan: [chuckles] It sure is.
Let’s talk front-of-house. What’s going on there?
Michael: Here’s the reality
about hospitality specifically and hotels, let’s be more even
granular. There’s obviously a massive investments of travel and
hospitality startups that are geared towards mobility, they’re geared
towards guest engagement, the guest experience, the ability for
guests to use their own BYOD smartphones to interact and to
experience property or a destination, for example. So there’s been
millions and millions of dollars invested — both at the brand level
and also at the vendor level — to enable mobile, for example. So
things like — I don’t know — mobile key access to rooms, brand
apps, et cetera.
Where UgoVirtual has identified a
couple of years ago and has been investing into initiatives, is the
virtualization of those type of experiences, the enhancements, the
scalability of those types of engagement experiences such as
virtualized hotel tours, deep virtual tours. They don’t require
headsets. They don’t require Hololens 2 for the consumer, but the
consumer through their mobile device, their tablet or at home,
through our solutions, through our virtual hotel tours that we are
fully rolling out in January of 2020. And we have some beta sites
already deployed all across North America. UgoVirtual hotel tours
solutions are very deep. They’re very much about the flow through a
hotel, experiencing the hotel, versus simply a 360 camera and some
sort of images.
The reason being is that hoteliers have
consistently over decades invested so much in the experiential design
and the look and feel and the feature function of their properties.
It’s an incredibly competitive market, like many other vertical
markets. And their investments in new builds and renovations are
massive and substantial. But this is all about the pre, the present,
and the post. The pre-virtualization of a guest experience. The
pre-experience of what it will be like to book this hotel, or book
their convention in this convention hotel, or book their meeting in
the meeting space, etc. is a massive benefit of what we call
hospitality XR from the front-of-the-house. And those are things that
we feel have been — in a limited fashion — enabled in the travel
and hospitality vertical.
But now we’re bringing out these
solutions that are far deeper, far richer, based upon technology that
you and I and others in industry know very well. But it’s all about
execution. So one major area is definitely the pre-virtualization of
travel or accommodations, so that consumers and the guests —
passengers of a cruise ship, for example — they have the ability to
differentiate and to make decisions on where they’re going to build
their travel itineraries, who they’re going to make their
reservations with, who they’re going to purchase services from.
That’s a massive opportunity that we’re very focused on executing in
the travel and hospitality space. That’s one major area of the
front-of-the-house.
The other area of the
front-of-the-house that we’re rolling out in 2020 as well is the
augmented reality experience within the guest room and the public
spaces of hotels or convention centers, etc. And we have invested and
are rolling out particular technologies that replace a lot of the
traditional content, printed content, even some of the digital
content that has been invested in by brands or travel destinations
over the last five, six, seven years, to make it a far more seamless
augmented reality digital overlay on the skin of the hotel or the
destination. That’s another area that you know well what I’m talking
about, and I’m sure the listeners do as well. Taking this augmented
reality interaction, these activations and actually focusing them on
the guest room. So we’ll be making announcements in January, February
on our next range of augmented reality solutions for hotels.
And then the last scenario that we very
much have commercialized and we’re rolling out is the virtualization
of events within the travel and hospitality space. But the reality is
that like any other vertical market industry, there’s a wide array of
industry events, of vendor events, of organization events that you
and I travel to many times, in many ways, in different verticals.
Well, we have a technology that we’ve commercialized over the last 18
months and we’ve already landed and are deploying multiple
virtualized events of brick and mortar exhibitors. And these are
industry related events in our space. There are organizational events
and there are also the vendor conferences for — for example —
hospitality technology vendors, who may have a conference every two
years because it’s incredibly expensive, quite challenging in regards
to bandwidth and time for the attendees and the vendors or the
speakers. So they may have these events every two years. Well, with
UgoVirtual virtualized events, they can have those events every year.
One year virtual, one year brick and mortar. And that’s really been a
major push crush. And we’ve had a lot of positive feedback on that as
well.
Alan: Watching the video, you’ve
basically created a system where you can have a virtual trade show,
looks like. And virtual meetings.
Michael: That’s exactly what it
is. Exactly.
Alan: So that’s not necessarily
in VR. I mean, you’re doing that on 2D screens. And so how is that
working out? What’s some of the response with that?
Michael: Well, we’ve generated a
lot of revenue, and we have multiple events signed and we’re rolling
them out in 2020. So I guess that’s the ultimate feedback from the
industry, is that people like us, they really like us, as Oscar
winners have said in the past. [chuckles] So, I mean, you can have a
vision, you can have an idea. If you’re executing in a vacuum, it’s
one thing. But when you’re executing and getting positive
reinforcement, and actual industry players are signing contracts and
investing in virtualizing their events, that’s the ultimate feedback
you can expect. And we’re still in a bit of a soft launch, because we
want to make sure that we’re executing very, very strongly on these
events. But the opportunity to go wide is really there, because
here’s the reality.
There are three areas of the travel and
hospitality industry globally where virtualized events from
UgoVirtual make a ton of sense. One is, obviously, our vertical
market industry organizations. There’s organizations called HTNG, for
example, that’s Hospitality Technology Next Generation. There’s
organizations called HFTP, which is the Hospitality, Finance and
Travel Professionals. These are — like any vertical market — these
are major organizations where we’re all members, and it’s an
important part of our careers. It’s an important part of training and
networking. And they all have very large user groups and work groups
and so on. So we are looking to talk to those people and move their
events — which we are all members of — to a virtual scenario
because you have an ability to expand reach, expand awareness, drive
actual interactivity between members of an organization or a vertical
market.
Because not everybody can travel to New
Orleans or travel to LA or travel to Monte Carlo. Not everyone can do
that. And no-one has the level in their career as an executive or a
decision maker, or they don’t have the bandwidth, or they don’t have
the travel budget. And secondarily and very importantly, what we’re
doing is also — as many of the people you interview — it’s also
green. This is a sustainability play, too. The ability to have more
events append existing brick and mortar events with UgoVirtual
virtualized event as a sister to the existing event is really
impactful from a sustainability perspective as well. Carbon
footprint, all those good thing.
Alan: Let’s shift focuses now to
the back-of-house. What are some of the solutions that you guys are
providing for back-of-house?
Michael: So in the back-of-house
space, we’re also a consulting firm, as I mentioned earlier. So we’re
focusing on assisting hospitality and travel brands on their strategy
for their employees, for their training scenarios, for optimization
of their back-of-house, human infrastructure. The reality of travel
and hospitality– And you were– now that you mentioned it, you
worked in this space. You know that turnover is massive. And that’s a
big challenge for hospitality brands, and ownership groups of hotels,
and conventions, and other scenarios. The turnover is massive. And
therefore, when that happens, a lot of the intellectual IP of how to
do what you need to do and your job in a hotel or in a conference
center or another hospitality entity, it evaporates. So there’s this
constant requirement for new hiring and training.
So taking the massive growth and impact
that virtual reality training is enacting in major North American and
global enterprise — as well as other vertical markets — we’re
bringing that to hospitality. So the back-of-the-house for us is very
much focused on VR and augmented reality training. So we’re
consulting with firms and we have relationships with the Microsoft
team in regards to Hololens 2, the HP team and their scenario. We’re
talking to Lenovo and many, many others who have both the hardware
and the cloud based infrastructure, so that hospitality and travel
companies can utilize this infrastructure, these tools to create
their own content, to be able to have a far more efficient, higher
retention and tremendous ROI on their training and back-of-the-house
staff. So that’s one area.
Another area that we’re involved in —
from an augmented reality perspective, in a product and deployment
solution — is creating the augmented reality overlays to the
physical plant of hotels or convention centers or mixed development
properties. The engineering manager of Hotel X been there for 15
years. He knows that the only way to get the boiler in the boiler
room to really kick in on the coldest day of the winter is you’ve got
to kick it twice and you’ve got to turn the lever to the right. He
leaves, he retires. That is gone. That knowledge is gone. I’m using a
very simplistic example, as you can imagine. But when you have an
ability to deploy a PIN code protected augmented reality overlay next
to the boiler, that has all this data, all this intellectual property
— knowledge — that’s permanently affixed in an augmented reality
scenario next to the boiler, it’s now there for the future. All
future employees or anyone who needs to have this information
available on the fly. So we are working on the back-of-house, as
well.
Alan: Kick twice and go down to
the back. [laughs]
Michael: Yeah. I mean,
obviously, when I’m using– I’m being pejorative and using a
simplified– but you know exactly what I’m talking about. And you’ve
seen it. And– I mean, listen, this is not always about inventing
something. It’s about taking best of breed solutions that are in
industrial and other enterprise scenarios, and overlaying it on a
very competitive, a very lucrative business called travel and
hospitality.
Alan: Well, it’s interesting.
Oil and gas companies have been doing this for a few years now.
Microsoft has really focused on enterprise. But when you see
“enterprise”, you think oil and gas, mining, construction.
But travel and tourism is an enterprise. Any group of companies where
you have millions of employees is an enterprise. So what are some
specifics? Like, what companies are rolling this out? What are what
are you seeing results wise? Is there any specifics you can share?
Michael: Sure. I mean, let’s
talk about on the front-of-house side of things. So Best Western,
about two to three years ago — major brand, huge portfolio of owner
managed hotels — made a mandate in order to roll out virtual hotel
tours to each of their Best Western properties. And it was well
accepted. It was a very good first major move. They’re one of the
first movers in the industry. It’s more of a 360 real estate type
experience, but it’s absolutely adequate and it has been adequate for
that period of time. And there’s been other brands that are more in
the boutique and independent luxury space, who have definitely done
the same. Where there is a next gen or next level is in regards to
really making these virtualized tours — like we are doing at
UgoVirtual — far more — what’s the word? — impactful and engaging,
and integrating them into different systems.
When you have a UgoVirtual tour of a
hotel, and you can embed in the actual booking of a hotel room from
one you’re– while you’re in the tour, or booking of a meeting space
through the RFQ interface of another system right within the tour. As
you know, engagement and activity. So that’s really where the next
level of what we’re doing in regards to the hotel tours. But listen,
Marriott has made investments. Hilton’s made investments. All the
major brands have had different levels of interaction in regards to
the tours. And we’re looking to — what’s the word? — maybe
aggregate some of that demand and bring out a very consistent,
deeper, richer, virtualized experience there. In regards to augmented
reality in the guestroom, the big, big push and the big deployments
have been different types of app-based or appless content and
interactive solutions in hotels.
I will say that we are in the early
stages, and our timing is great in regards to the augmented reality
overlay within hospitality. That is — again — an evergreen
opportunity. There has not been a massive amount of guestroom related
implementations. That’s why we feel we have a tremendous first mover
advantage and during our announcements in early parts of 2020, we’re
going to make sure we make the most of that impact. But what I will
say in regards to augmented reality in hospitality, there’s been a
lot of very successful activations by people like Foxwoods, casinos
and hotels, and other forward thinking brands and travel companies,
who have used it as more promotional and a way to do gamification
around their property, to have the guests or the consumers move
through the property to — for example — have a digital hunt where
you’re looking for different symbols or you need to collect the
activations of 12 different photos of Big Papi — former Boston Red
Sox, a DH — who’s obviously an ambassador for Foxwoods, for example.
So you have to go through the hotel and
you have to find all of the photos of Big Papi, and then use your
phone and activate the augmented reality experience. And when you do,
you get a bonus offer or you get points or you get a gift. So that’s
been really successfully rolled out in hospitality. And there’s the
beginnings of what we’re also involved in, is the AR activations for
the exterior of the buildings. So you’ve seen this in major brands in
the consumer packaged goods and consumer product space for using
these major neural activations. Well, that is starting to trickle
into the hospitality as well. Because these are buildings, and these
are buildings and resorts and convention centers, which have a ton of
external real estate — if you know what I’m saying — that the
activations of AR experiences are starting to trickle into there, as
well. And we’re involved in that, too.
Alan: It sounds like you guys
get your fingers and everything to do with XR and hospitality.
Michael: We’re focused still,
I’ll be honest, because we’re not a custom development shop, per say.
Yes, we’re a hospitality XR consulting company, for sure. But we have
selected and have invested in specific lines of business and
solutions, that we feel have the most opportunity for travel and
hospitality. One thing that’s really important, Alan, I think for
this conversation is yes, were a startup and in growth mode, for
sure. And we have interest from various parties to help us with our
growth. But we’re not– I’m not looking to belittle the traditional
startup cycle, but we are overlaying hospitality XR both for the
product and service to space and as consultants on the realities of
commercializing technology in travel and hospitality industry. We
know the budget seasons, the line items, how the widgets have to be
positioned from a commercialization and business model space.
That’s incredibly important, because
what we’re doing is we’re doing our own proprietary and we have
exclusive licensing on a range of technologies that we’re
commercializing globally in travel and hospitality. But we are
overlaying our own technology or licensed technology on existing
business models, that have been proven and are required over the last
30 years. And that is a big differentiator here, because as you know,
it’s hard enough to get buy-in authorities or C level folks to engage
and get behind a new technology. But if the business model or the
commercialization plan doesn’t align with what they’re used to, it’s
even another challenge. We have absolutely met that and exceeded that
scenario, because we know how to put the square peg in the round
hole, and roll out the technology in a way commercially that is both
viable, scalable, but also understandable to travel and hospitality
executives.
Alan: So if you’re speaking–
let’s say– assume that somebody from the industry is listening to
this podcast, what’s step 1 for them?
Michael: Well, step one for them
is– first of all, if you’re listening to the podcast, we appreciate
it. [chuckles] And second of all is, they’re digesting a lot of
information. There is a firehose that’s being blown into the travel
and hospitality space — like many other vertical markets, enterprise
markets — that these executives know they have to get on board. They
have to start crystallizing their strategy and their visions on how
in our industry hospitality XR — hopefully through UgoVirtual — is
enabled within their brands and their properties and their
destinations. So they’re already investigating. They’re already
collecting information. They’re reading, they’re watching. The goal
is there needs to be an alignment of this technology with what’s the
successful principles of their business. From our perspective– and
that’s why we’ve opened the consulting side of the business, because
we’re there to help them align those two important areas.
And then obviously, they need to
investigate what is the appropriate next steps if they’re interested
in front-of-the-house hospitality XR. What sort of areas or what sort
of feature function or benefits they want to achieve? What sort of
enhancements do they want to append to their existing successful
guest engagement scenarios? And those are things that have to be laid
out. And then they would talk to people like us, to help them
organize that, but also just to see what’s available in regards to
technologies that they can license, technologies that are scalable.
One thing you have to remember is that
in the major travel and hospitality brands, either destinations or
resorts or hotels or Disneys of the world, everything’s a thousand
points of light. It’s usually not one property or one destination. In
the enterprise side of travel, hospitality, it’s hundreds. It’s
thousands. There’s 14, 15, 16,000 hotels in North America, for
example. There’s hundreds and hundreds and hundreds of thousands of
guest rooms all over the world. That’s a big consideration. That’s a
differentiator from other industries. Yes, of course they have 200
locations, or they may have 50 training centers. These are all really
major accommodations that require a lot of planning a ticket to an
exponential level with travel and hospitality. That’s a critical,
important part of the successful identification, research, rollout,
and execution on hospitality XR: the thousand points of light. It
could be 50 points of light, could be a 1,000 points of light. But
that’s really important.
Alan: Let’s talk about– I do
want to bring up one company in particular, because they kind of been
flying under the radar. What are your thoughts on a company called
Oyo, who — from what I’ve heard — now are the number two hotel
chain in the world?
Michael: So we can have this
conversation regardless of hospitality XR, because this is really
important. So Oyo has a business model and has a system in place and
they’ve come out of Southeast Asia and Ritesh [Agarwal], their owner,
is a very dynamic CEO and he has major funding from Softbank, so he
has taken the traditional hospitality business methodology and he’s
put it on its head into almost like a technologies solutions company.
So there are great opportunities, great growth, but there are also
great challenges that they are facing. Hotels are hard. Every hotel
is a snowflake. It’s very challenging to scale traditional
hospitality surfaces, traditional hospitality technology, a server,
access points, IOT sensors, hardware. It’s challenging to roll that
out, because there are different configurations, different designs,
and different systems in place in every hotel in the world.
Alan: Oh, I know. Wi-Fi. Listen,
the hotel people that are listening to this: please, if you’re going
to work on one thing, Wi-Fi that works universally.
Michael: No, Alan, I mean, the
point is — you know this, I’m going to bring this back to our
conversation — is the consistency and the quality of Wi-Fi. I was–
I have been involved in Wi-Fi commercialization in travel and
hospitality for 15 years. And I worked with AT&T and other
leading hospitality Wi-Fi companies for many, many years. So I’m a
bit of an expert, barely stayed up at this one, I could say. And
you’re absolutely right. It’s a critical juncture. It’s like oxygen
for a hotel, because if the Wi-Fi is not consistent and the quality
is not there and the coverage is not there, it’s a real impact to the
guest satisfaction scores of hotels. And this is a good segue back
into what we were talking about.
Two things: guest engagement, guest
experience. So it’s front-of-the-house again. That’s where
UgoVirtual– and that’s where the virtualized and augmented reality
solutions that we’re bringing out, and the hospitality XR consulting
that we’re we’re delivering is key. Because this tsunami of XR that’s
going global, which you are a world expert at– and you know I’m not
kissing your behind, because I know who you are, we’re friends. And I
know the impact that you’re making around the world, and all the
travel that you do, and all the events you go to. So the tsunami of
XR in all different types of business and enterprise, it has its
place in travel and hospitality vertical. But what’s mission
critical, it’s not only about revenue and the retail environment,
it’s about optimization. It’s about revenue per square foot. It’s
about making sure that each aisle is activated in a way that can
drive more products to sell.
In hospitality, if you mess with the
guest experience, you’re in deep trouble. So the ability to
efficiently and intelligent roll out hospitality XR in our vertical
is incredibly delicate and also incredibly important. Guest
satisfaction scores are the cornerstone of a lot of the metrics in
general about hospitality. So that’s really critically important. But
second to that is, let’s talk about connectivity and let’s talk about
wireless connectivity.
Back to the Wi-Fi scenario. Wi-Fi 6,
5G. You know this, we’ve talked about this in the general sense, but
in hospitality and travel, it’s even more paramount. Because you have
massive concentrations of guests, passengers, consumers who are on
present — so this is the present part of UgoVirtual’s strategy —
they’re on premise. They’re interacting with the property, the
destination or the cruise ship. Any solution that’s deployed by us at
UgoVirtual — or anybody else in hospitality XR space — needs to
have seamless connectivity to make sure that experience is 100
percent, because if it’s not a 100 percent because the connectivity
is off, there you have the guest satisfaction challenges again. So 5G
and Wi-Fi 6 is the massive enabler to this next generation of
front-of-the-house and back-of-the-house solutions for travel and
hospitality. It’s a critical part of the success methodology for it.
Alan: Well, Michael, I really
want to thank you so much for taking the time to explain how XR is
going to be used for hospitality. If you look at just from the lens
of training people, I mean, that alone is a massive opportunity for
hotels. When I was in hotels, the training was not that great then.
And it really hasn’t improved since then. So being able to give
people the opportunity to train at a higher level, before they even
step foot into a property, I think is a really great opportunity for
these organizations.
Michael: There’s two quick
things I want to add — if I could — to that from the
back-of-the-house perspective and I’ll be brief, is in our industry
— like many others — the SOPs, the Standard Operating Procedures
are mission critical. And like you know, we know, but maybe not
everyone knows who’s listening to this. People like Wal-Mart and
FedEx and other major companies have made reasonable corporate
investments in VR training, for example. And they have realized
exponential ROI. Is that fair to say, Alan?
Alan: Yes. At least 10x what
they’ve put in.
Michael: Correct. I wanted you
to say 10x, because I don’t want to be the hypester. You’re the
expert. So what I’m getting at is in hospitality, the ability to
pre-qualify, pre-identify through the actual HR process of potential
back-of-the-house staff to interact in the actual experience of
implementing standard operating procedures and certain tasks — at a
hotel or a conference center or a cruise ship, for example — is
amazing, because you actually have ability to cull down to the best
cohort of your applicants and then you can get them into the company
and then you can train them very efficiently. As we know, with VR
training, you have higher retention, shorter training cycles and
major ROI. I mean, those are– that’s a winning scenario. That’s
really important. So the combination of SOPs with VR training and
working with brands and working with travel companies from a
UgoVirtual perspective, so they understand how to implement that on
the back-of-the-house is definitely part of our mandate and our
mission.
Alan: I’m really excited for the
future of what you guys are working on. And I’ll end on a quick
story.
Michael: Sure.
Alan: You know how Marriott
introduced VR room service, like VRoom service? So we actually
pitched them on that, and they took the idea and built it, and then
sent us one. So we got this briefcase where it was like a Gear VR and
a phone. And it’s like, “Look, VR room service!” I’m like,
“Oh, great, thanks.”
Michael: [laughs]
Alan: I was like, “Oh well,
it was a good idea.” But yeah, the hotels are really
experimenting with these things and it’s exciting. And hotels,
restaurants, everybody will be impacted by it. So thank you again for
taking the time to share this vision. Where can people find
UgoVirtual?
Michael: Sure. It’s
ugovirtual.com, and in LinkedIn just search for “ugovirtual.com.”
And we are the travel and hospitality virtual solutions company.
Alan: Thanks so much, my friend.
Michael: Alan, a pleasure. And
look forward to seeing you in the future at the next major event.
Thank you for this time today. Appreciate it.
Alan: Sounds good.
34 min
March 03, 2020 IAAPA Update from Location-Based VR Expert, Bob Cooney
Today’s guest, location-based VR expert Bob Cooney, has been in the XR space since the early 1990s. He drops by the show to give Alan an update on all the newest tech advances he saw at the International Association of Amusement Parks and Attractions Expo, and explains how today is the most exciting time to be working in this industry.
Alan: Welcome to the XR for
Business podcast with your host, Alan Smithson. Today’s guest is
always on the bleeding edge of technology. He’s able to predict both
tech and business trends. Bob Cooney is widely considered one of the
world’s foremost experts on location based virtual reality, and the
author of the book “Real Money from Virtual Reality.” I’m
really super excited to introduce my good friend and colleague, Bob
Cooney to the show. Welcome, Bob.
Bob: Oh, dude, I’m so happy to
be here. Thanks for having me, Alan.
Alan: It’s my absolute pleasure.
It’s been a long time coming, this interview. But we’re here. We’re
excited. And we just are coming off the heels of *the* major North
American show, IAAPA — which for those of you listening and you
haven’t been there — it’s basically Disney World for VR, AR, and
out-of-home experiences. You were there. Let’s talk about what you
saw, and what are the trends coming in out-of-home entertainment.
Bob: Yeah, it’s an amazing show.
I’ve been going this– I think this is my 27th IAAPA or something
like that. And my first one was 1991. And over the last four or five
years we’ve seen VR every year just grow in not only the number of
companies bringing VR/AR solutions into the market — mostly VR at
this point — but the quality is every year measurably increasing.
And that’s the thing I think that has me so excited is three or four
years ago there was just a literally handful of things that you would
even remotely consider as an operator. And last year there was
confusion now, because there was– you were starting to see a lot of
good stuff and this year it was just overwhelming. And so, yeah,
we’ve seen real quality come into the market.
Alan: You’ve seen pretty much
everything there is out there. What’s one thing that blew your mind
this year?
Bob: Good question. The rise of
unattended virtual reality systems. There was a company called LAI
Games, which has been around for decades. They’re based out of Asia.
They build arcade games. And a couple of years ago, they took a
license from Ubisoft: Raving Rabbids, which is a really popular IP.
They merged it with a D-Box motion base and they created a VR ride
for family entertainment centers, arcades, and theme parks. It’s a
two player ride. It was fairly cost effective, but they recommended
it be operated without an attendant, and it was the first VR
attraction that came out where you didn’t need to staff it. And the
profitability of that really made a big difference for operators. And
now this year there was another company called VRsenal, that had an
arcade game cabinet with– that was a VR based that was unattended,
and it was running Beat Saber, which is obviously one of the most
popular games out there. And so we’re starting to see companies
realize that maybe we don’t need attendants. Maybe people are smarter
than we give them credit for. Maybe they can figure out how to put a
headset on their face. Maybe they will clean it by themselves if they
care about that. And so I talk about a lot about the four-minute
mile, once it was broken. People thought was impossible, people
thought if you try to run a four-minute mile, you would die. And once
it was proven that it could be done, hundreds of people have done it
since. And I think this notion of unattended VR is similar to that.
And we’re going to start seeing more companies give more credit to
consumers, that they’re smarter than we think they are.
Alan: When I was in China, they
have VR kiosks in a lot of the malls and some are attended, some are
unattended. But I– I remember I was walking through the mall and I
was like, “Oh man, VR!” and pull out my phone to videotape
it — because this was two years ago — and I watched somebody fall
completely on their butt, because they were downhill skiing in an
unintended thing and they fell on their butt, and then they got back
up and did the thing. And then I was in another mall, videotaping a
kid in VR and he fell on his butt. So there are still some risks with
this. How are they mitigating that? Because I know the Rabbids one is
using a D-Box and you sit in it. So is that kind of what you’re
seeing? Because I know with Beat Saber, for example, you’re not–
there’s no real risk of falling over.
Bob: There’s risk of somebody
walking into your space and whacking them–
Alan: Oh, yeah.
Bob: –over, right? And so what
the arcades are doing is they’ll put rope stanchions around those. I
think the seated motion simulators are pretty safe. One of the
Facebook groups yesterday, somebody posted how their son was in the
hospital with a chipped tooth and a broken ankle from playing VR and
falling. I don’t know what game they were playing, but they fell and
hit their head on the table. And so there are some real risks around
VR, that could limit adoption. And that’s– certainly on the consumer
side, I think that’s a problem.
Alan: So, Bob, how are these
companies mitigating this risk, or what are you’re seeing that’s
mitigating this?
Alan: I think operators and
setup and safety is important. A lot of them are putting the
unattended stuff in view of like a redemption center, where there’s
always somebody behind the counter redeeming tickets for prizes. I
think the Beat Saber arcade game, they’re putting rope stanchions
around them or cordoning it off, so people don’t walk into the space
where somebody is actually playing the game. I think the seated stuff
is inherently safe. There’s always a chance to get toes can get
crushed, and things like that if people are careless. But I think
that’s something operators have been dealing with since the very
first driving games that had motion’s systems built into them. And I
do think it’s one of the things that could really slow consumer
adoption, though. If you remember the Wii when it first came out,
people were smashing televisions with controllers playing tennis.
Alan: It’s interesting you say
that, because we’ve been doing demos with the Quest, and the same
thing. You set it up, you set up stanchions. And it doesn’t matter.
People still– they get excited. They get in there. They don’t
realize they totally lose control. That’s the power of VR, they get
right in there. And we’ve had somebody get punched in the face with a
controller recently. And it was like, “Oh, jeez.” They
weren’t within the stanchions. They were outside of it. And they
just– the person lunged out of nowhere.
Bob: It’s the paradox of
presence, right? I mean, you’re–
Alan: Yeah.
Bob: –you’re really present in
the experience. You forget where you are. The fantasy-reality line
blurs. And then next thing you know. And that’s the inherent problem
with it, is that that’s– in order for it to be effective, it’s not
going to go away. And so I think safety systems– and you know, one
of the things I would expect is as inside-out tracking gets better
and the cameras get better, if you get too close to an object maybe
the pass-through video kicks on. They’re going to have to figure out
a way to make this stuff safer overall.
Alan: Yeah, the way the Quest
did it, where you can draw out your boundaries and then if you walk
through the boundaries, it goes from being in virtual reality to
being in the real world or pass-through camera. That actually a
really nice solution. What we’ve been doing now is putting people in
VR when they’re outside of the boundary, and then having them walk
into it. And it’s this kind of a-ha moment, where they go from the
real world of crappy pass-through camera to the completely virtual
world. And it’s that moment of delight that you see. Now, speaking of
moments of delight, because you get to see not only try these
experiences, but you’re really intuitive into the emotions that
people are feeling when they’re on the rides. What are some of the
rides or experiences that you’re seeing that really resonate with
people?
Bob: Yeah, look, I think that–
it’s funny. There’s a narrative in the industry that we have too many
zombie shooters, but the numbers show that that’s actually what
people want to play. And people love horror, horror’s had another
blockbuster year in Hollywood, and I think people like to be scared.
And that’s one of the easy emotions that you can trigger is fear. And
so whether it’s Richie’s Plank in fear of heights, or zombie outbreak
shooters and stuff like that, I think people love to be scared. And
the interesting thing is, statistically, women like horror more than
men. There’s all these great viral videos out there about women
screaming in these zombie shooters. But I think that’s the thing that
really triggers emotion, is that fear is the easy one. It’s the low
lying fruit. And I know companies that have put out multiple titles,
but their horror titles are always their number one earning and
number one ticket seller. And so I think you’re gonna continue to see
that, until we figure out how to really tell stories and drive other
types of emotion in VR. And I still haven’t seen a lot of that yet.
Alan: What about racing games? I
tried one the other day and it was absolutely mind-blowing. It was a
6DOF simulation machine. So the whole thing was riding on multiple
pivot angles. And when I hit a bump on the road, I felt the bump on
the road. It was just– and when I hit the wall — of course, going
too fast — I hit the wall and the whole thing just rattled me. It
was wild.
Bob: Yeah, look, I think that
there’s a lot of bad motion simulation out there in VR, which
triggers motion sickness. If it’s not done well, it can actually
exacerbate the simulator sickness that you get. There are a couple of
companies that seem to be doing good. Like I did Mario Kart VR from
Namco, which is a really fun game. And I think that that makes sense
to have in VR too, because you have to look over your shoulder to see
where your competition is, to see who’s going to throw things at you
or you can throw things. One of the surprise hits from the IAAPA show
— to go back to that — was a company called UNIS out of Taiwan, I
think they’re based, they had a two player motorcycle VR simulator
and it was a track racing motorcycle game. And when you’re leaning
into the turn or looking over your shoulder, that presence of VR and
to be able to look behind you and see your competition coming up to
you was really well executed. And so I think– and I got no motion
sickness at all out of it. So it was really well done. So I think
companies are getting better at it, and they’re using it in
appropriate ways. I think that my personal opinions in a drive racing
simulator in a car, you have mirrors, like you don’t look over your
shoulder. And so I don’t know what advantage VR really brings. The
resolution isn’t as good. The frame rate is not as good as you can
get in a big monitor. I almost feel like for driving simulators,
you’re better off with a really good 4K monitor at 200 frames per
second with good mirrors.
Alan: The one that blew my mind
was three panels kind of stuck together.
Bob: Exactly. I think that’s a
much better use of the technology. Totally agree.
Alan: It was wonderful. I did
drive– because I was at the I/ITSEC show, the Industry– Inter–
Bob: Big military simulation
show.
Alan: Big military simulation
training. So I got to drive a tank, that was cool. I got to fly a
helicopter, which was interesting. I crashed it, dramatically. The
guy’s like, “I don’t think I’ve ever seen anybody crash this
thing like this.” [chuckles] But here are multi, multi-million
dollar simulators, and they’re not as good as the ones that are at
IAAPA.
Bob: Yeah, that’s interesting.
And I think that– how much of that is just because the military is
used to overpaying for everything — we’ve all heard about the $9,000
hammer and the $40,000 toilet — and how much of that is just the
nature of the accuracy. Like one of the things I did some work with
zero latency and they did some work with the Australian Army in
building simulations. And one of the things that everything has to be
about muscle memory when you’re in the military. And so these
simulations have to be incredibly accurate down to button placement
and things like that. And because it’s generally lower volume, I
wonder if that has a lot to do with it.
Alan: It could be, actually. It
could be the rigorous demands from the client, but also the fact that
they’re not buying hundreds of them, they’re buying tens of them.
Bob: Yeah, totally.
Alan: Makes sense. And then, of
course, everything’s custom for them and you can’t share the content
out. So there’s that.
Bob: Yeah. And look, I think the
military has been doing this stuff for a long time. And we saw a
couple of military simulation companies kind of stick their toe in
the amusement water. And that happened a lot with companies like
Doron Simulation, they did military simulators and wound up going to
doing some big, large format, large capacity motion simulation in the
amusement industry. And I think there’s been some cross-pollinization
between the military, some companies and the amusement and
entertainment sector companies. I think on a smaller scale stuff,
that’s more in the game space. That’s just I just don’t think they
get that mark. There was a company called Raydon — who was probably
at I/ITSEC — who was a client of mine a couple of years ago. They
brought a 50 cow simulator, and they put it in kind of an arcade
cabinet and created a game that was kind of like space bugs — think
Starship Troopers — with this giant 50 cow simulator, and a
butt-kicker on it to create recoil. And it was called Total Recoil.
It was a great experience. But entering into the arcade game
business, they really [went] from being a military contractor, just
chalk and cheese. And I think they struggled to try to make something
that was inherently fun and replayable. I think that’s one of the big
challenges in the entertainment industry, is people are looking for
games they want to play over and over again. And training simulation,
you’re doing it for a different reason. It doesn’t have to really be
replayable from a fun standpoint. And I think that there are real
skills in creating games regarding core loops and dopamine rushes and
things like that, that get you don’t want to play it again, that the
military companies just don’t need to understand.
Alan: So let me ask you a
question, Bob, because this really intrigues me. You talk about these
things that make something replaceable, and how maybe military sim or
even training is not looking for that. But shouldn’t we — as people
creating training simulations — be thinking about that? Because if
we make it so that people want to do it over and over again, and have
that repeatability, and that want to play it again, wouldn’t that
kind of increase their ability to become proficient in whatever it is
they’re training?
Bob: Yeah, absolutely. But I
think it’s a different mindset. So when you’re training to become
better at something, that’s a mindset. And when that’s my profession,
I’m driven to do that. When I go to have fun, I’m not necessarily in
the mindset to improve. Now, there’s a narrow slice of the
psychographic market, that will say “I just want to get better
and better, and I want to prove, I want to play against myself, I
want to beat my high score.” That’s where the leaderboards and
stuff comes in. But it’s not actually the broad market for VR. We
find the broadest market for VR is casual impulsive entertainment.
People just looking to go out and have a good time with their
friends, and to have a story to tell. And so I think you have to
really know your market. If you’re building entertainment products,
know who your target consumer is and build for them. And there’s a
lot of people now building these kind of PVP — player versus player
— e-sports games, that are highly competitive and they’re not
earning very well so far. I mean, there’s a couple of them that are.
I know Virtuix, the Omni arena’s doing really well in its early test
locations. They got about–
Alan: Yeah, how’s that going? I
actually tried the Cyberith one at the I/ITSEC show. And it was
interesting– and for people listening, if you don’t know, it’s a
kind of redirected walking. What would you call it? Omni-directional
treadmill kind of thing. So the one I tried, you’re strapped in at
your waist, and you’ve got these slippery shoes on, and you just walk
in any direction you want to go. But what I found was I felt totally
hammered drunk, walking around in that thing.
Bob: [laughs]
Alan: Like, I had no control. I
kept falling over and like, because you’re strapped in anyway,
doesn’t matter, you can’t really fall. But I just felt like I
couldn’t walk in a straight line. I was like, if somebody gave you 20
shots of tequila and then said “Walk down the street,”
that’s what I felt like. I was all wobbly kneed and it was not the
most fun experience, but I guess with practice it might feel better.
Bob: And I think some of that is
in the interface in between the hardware and the software and the
control mechanism. I think if you try to use that as just a human
input device, it’s going to be difficult. And I think there are some
companies do that. I think Virtuix invented the device, they’ve been
doing it for six or seven years. I think they’ve kind of perfected
that. And even with that, it can be a little awkward. But once you
get into it, it’s the closest thing you can do to running in VR. And
there’s just something visceral about dual wielding shotguns in a
zombie apocalypse and running around. And the head is just– there’s
something magic about that, Alan, I can tell you.
Alan: It’s interesting. I got to
try another walking simulator — and I’ll look it up while we’re
talking — but it was walking on a treadmill. It was bi-directional
treadmill. So wasn’t omni-directional, it was just bi-directional.
But the way they had coded the experience, as long as you stayed
within a green circle, you could just keep walking. And my first
thought– because the first thought is I’m going to walk into
something, because I’m in this big kind of thing. And then when you
take a few steps, after about the tenth step, you’re like, “Wait
a second. This is really cool. I’m walking and yet I’m not any closer
to the wall.”
Bob: Yeah. And one of the things
we saw in the large scale free roam — like the big warehouse scale
free roam experiences — is the longer– the further you walk, the
deeper the immersion goes.
Alan: Yeah.
Bob: Because eventually that’s
what happens, your mind says, “OK. Actually, I am walking. I’m
in a bigger environment. I’m not going to walk into something.”
It lets go of that reality. And you enter that fantasy world where
you realize you’re in this environment. And if you can do that for a
few minutes– some of these experiences, I’ve traveled as much as a
half a kilometer. And the immersion gets really, really deep when
you’re in it for a half an hour and you’re just walking around
freely.
Alan: That’s crazy. So, you
know, in a business where square footage matters, one of the things
that the Void did really well is they employed redirected walking or
the ability to kind of use the same set for multiple pieces of
content in a very small footprint. What are you seeing around that
sort of location based entertainment where they take over the whole
space?
Bob: Yeah. And I think all of
the companies that started out with these big warehouse scale stuff
are looking at realizing the economics. A, there’s an economic piece
of it and B, there’s just finding locations with 2,000 square feet of
open space without pillars in an urban environment can be really
hard. I know a guy that was looking in London for a year trying to
find a location for Zero Latency location, and he couldn’t. So I
think there’s a couple of drivers there. One is just the cost and one
is availability of space. And so they’re all trying to figure out how
to go smaller and smaller and smaller. But those are tradeoffs,
right? I mean, the very first free roam space I played was 4,000
square feet or 400 square meters. It was a 15-minute game and it was
amazing. But how many places can you operate? Something like that.
And I think there’s one in Chicago, mass VR that’s on that scale,
too. But I don’t think they’ve ever opened a second location. So,
yeah, I think that there’s a lot of tradeoffs. And look, from an
operating model standpoint, everybody’s still trying to figure out
where the sweet spot is. You know, The Void is still struggling to
try to figure out these single unit economics. I think Dreamscape is
still trying to figure it out. Even Zero Latency, I think they just
opened like their 37th location in Barcelona now or something last
week. But I know I’ve spoken to all of their operators, and some of
them make money and some don’t. None of them are really getting their
money back as fast as they wanted to. And so I think that the
business models are still being fleshed out, and finding that– once
people figure out the sweet spot, everybody will rush into it. And
the fact that people are still experimenting tells me nobody’s really
figured it out yet.
Alan: It’s interesting you say
that, because I think that’s indicative of the whole industry. VR,
AR, from a corporate standpoint, we’re really just touching the
surface of what’s possible and the business models around this. You
know, it’s funny. We’re writing financial models for a company and
they’re like, “Okay, here’s the products, here’s the clients we
want to go after.” And I said, “Guys, you realize that
everything we’re doing here is just a complete guess, and it’s all
going to be wrong.” Like, literally no rhyme or reason for it,
because as we move, the industry is shifting. And I say to this to
people, “It’s not just a new technology, it’s a new industry,
it’s new business models. Everything’s unproven.” So how do you
then– I guess you just got to keep experimenting, which was what
everybody’s doing.
Bob: I tell people, this is the
most complex market you can imagine. And the solution for solving
complex problems is sitting in the problem space longer. Einstein
said, “I’m not smarter than everybody else. I just sit with my
problems longer.” And I think he was lying about that, he was
smarter than everybody else. But he did sit with the problems. And
there’s a really interesting thing for the listeners, if you Google
the “Snowden leadership framework”, it’s a Harvard Business
Review article, it was back in the 90s. And they talk about this
thing called the Cynefin model — and it’s a Gaelic word — and they
talk about how to deal with different levels of complexity. And they
say, in a complex market you have to stop trying to find the solution
right away. And I think VR is that, and you’re seeing a lot of
companies experiment and share the opening. And the thing I love
about this industry is everybody seems willing to share with most
people. Because they know it’s day one, they know we haven’t tapped
the beginning of the market, and it’s not a zero sum sum game.
Everybody can still win at this stage of the business. So there’s a
lot of sharing and a lot of experimentation happening. And I love
that.
Alan: Yeah. It’s really a
wonderful industry to be in. I came from the music industry and music
technology, and it was — I guess — a more mature industry. So there
was sharing, but not really kind of at the level where it’s like,
here’s all my information or I’m on a podcast telling everybody about
how VR and AR is working for our business. And even just on this
podcast — the XR for Business podcast — we’ve seen a really
incredible sharing of knowledge. And I think this is one of the best
things about this industry, is people are willing to help. And like
you mentioned, it’s not a net sum game at all. The industry — as an
entire industry — is about $10-billion in 2019, will close off the
year between 10 and 11 billion. And that’s going to increase to
500-billion by 2030.
Bob: There’s plenty of room for
everybody. If new entrants stopped coming into the market, everybody
in the business today that survive would be a billionaire. So that’s
not going to happen, because people are continuing to rush into the
market. But yeah, there’s plenty of room for everybody right now. And
it’s really exciting to have been watching the industry grow, like I
did my first VR product in 1992. I’ve been watching this thing bubble
up for 25 years and and it’s nice to have some–
Alan: Is now the time or what?
Bob: Oh, absolutely. Zero doubt
in that. I think the technology just wasn’t there before. And the
mobile phone revolution with really inexpensive accessible small high
resolution LED screens or LCD screens, and IMUs, and tiny processors,
and all of the components that Palmer Luckey needed to build his
first Oculus headset came out of the cell phone industry. And so we
can thank the cell phone guys for making all this possible.
Alan: Well, speaking of cell
phone guys, you’ve got HTC as a major player. They actually sold
their cell phone division to Google to focus on VR.
Bob: Man, that was crazy. Like–
Alan: I agree.
Bob: Talk about a bold move. And
I hope they’re successful, because I love to see bold business moves
rewarded. But that was a pretty risky move, but talk about belief.
That’s the manifestation of belief.
Alan: Yeah, it’s focused, too.
If they’re all in on spatial computing in the future of this, and
they seem to be doing well. Out-of-home entertainment locations, I
would say HTC is probably the leader.
Bob: Oh, by far. Like, not
even– nobody’s even a close number two right now. And some of that
has been attitude. I mean, Rickard Streiber early on realized that
they had an awareness problem. He said, “All right, let’s
support the arcade business, because that’s where people can at least
get an idea of what VR is like.” And I criticized him publicly a
little bit, because the arcade owners back in the 80s, that whole
business got basically disintermediated by the consumer gaming
market. So once console systems got really good and really
affordable, people stopped going to arcades. And so in a way, he was
trying to get arcade people to build VR arcades, so people would be
able to buy VR at home, and it would put the arcades out of business.
And now that we’re starting to see more free roam and less consumer
adoption than anybody expected, I think that those models are
starting to solidify a little bit. But HTC saw early on that they had
an awareness problem and they are trying to fix the awareness
problem, whereas Oculus thinks they have a pricing problem. And so,
you know, they come out with a Quest and they come out with the Rift
S, and they give really hard technical limitations to both of them to
hit a $399 price point, thinking that’s going to move the market. And
so two different companies with two entirely different beliefs of
what the problem is. It’ll be interesting to see how that plays out
this Christmas.
Alan: Have you tried the Quest?
Bob: I have, yeah. In fact, I
just ordered one. I tried it early on, before it was released.
Obviously, I get to demo a lot of cool shit that’s in development.
One of the nice things about my job. But I finally broke down and
ordered one, and I’m going to see if I can’t travel with it, because
I get so many people that I meet that haven’t tried VR, and I want to
be able to just put a headset on them and say, “Check this shit
out.” Am I allowed to say that on your podcast?
Alan: You’re allowed to say
whatever you want, my friend. Now, this is a family show, but I
believe that if you’re passionate about something, these things come.
Bob: Yeah, so. And funny, what
got me over the line — because I’m a consumer — was they bundled
Vader Immortal with it for Christmas. And so they’re starting to
learn about the whole notion of bundling, and what’s going to drive
adoption. And then they just then– obviously they announced they
acquired Beat Games last week.
Alan: Yeah, that was cool.
Bob: I wrote a blog post about
that. And by the way, if anybody’s interested, I write a weekly blog
on location based VR at bobcooney.com called Dropping In. So if
you’re interested, check that out. But my blog post last week was
about the Facebook acquisition of Beat Games and how– try to figure
out why they did it. If you think back to the music games of Guitar
Hero and Rock Band, those peripheral kits were really expensive.
Couple of hundred bucks for the whole band set. 300 bucks, 350 for
the Beatles one. And so I think music games have the ability to sell
hardware. And I think Facebook realizes that. And they decided to buy
Beat Games. They’re going to push that hard. And then you’re going to
see a lot of new music coming in. It’s really exciting time. How
happy am I for those guys, the guys that started Beat Games and
cashing out, hopefully they made a bajillion dollars.
Alan: [chuckles] We’ll never
know how much they’re going to make. I think it was–
Bob: But hopefully those guys
cleaned up. I love seeing entrepreneurs make money.
Alan: Hopefully they also keep
Beat Saber available on other platforms.
Bob: Yeah, absolutely. And they
have to. Well, they don’t have to, actually. And I think that there
would be a massive community backlash if they didn’t, at this point.
And you know, Oculus and Facebook, they’re undergoing all kinds of
scrutiny from all kinds of people. And they’re going to have–
they’ve got to be careful with everything that they do right now, and
how it affects their brand and people’s perception of them.
Alan: Agreed. So let’s go back
to IAAPA for a second. If you were to say that these are the five
highlights of IAAPA this year, what would they be?
Bob: Yeah, for me, I actually
gave out– I have created my own award called the VR Bauble Award.
And for recognition of companies that are really doing not only good
stuff, but innovative stuff in the space. And Rabbids: The Big Ride
was one of them. The VRsenal unattended Beat Saber cabinet was one of
them. And there was one that really caught me by surprise, was a
company called Ballast– DIVR, they had a product called Ballast, and
I had to actually throw on board shorts and get in a pool to try it.
And they have a waterproof headset basically built into a scuba mask
with a snorkel. And you hold on to one of those underwater propulsion
devices — like a little torpedo thing that you hold on to — and
it’s hooked up to an air compressor, so it cavitates and there’s a
fan that blows jet– a jet that blows the water on you. So you feel
like you’re moving underwater. And it was mind blowing, it was
fantastic. I was like screaming through my snorkel. And I think that
from a business model standpoint, you’ve got all of these resorts
around the world that have pools that are underutilized and
unmonetized. And now all of a sudden, you can drop 100 grand worth of
equipment in there, and charge 20 bucks for a seven minute underwater
VR experience and start monetizing pools. And I think you’re gonna
see resorts do that. And so that product blew me away. It was really
surprising.
Alan: That is super cool. Think
about this, for all the people going on vacation over the holidays,
how much can you really drink by the pool?
Bob: Yeah.
Alan: Don’t answer that
question.
Bob: And the ability– one of
the experiences was like free floating in space. So when you get in a
weightless pool environment, there’s all kinds of things you can do.
So I was jetting through the lost city of Atlantis, but then all of a
sudden I was free floating in space in the International Space
Station. And that was really cool. And being in the water removes any
notion of motion sickness as well. So super accessible. So that was–
yeah, that was a great– that was just a mind-blowing experience for
me. It really changes the game when you can start doing VR in water,
that was amazing.
Alan: Super cool.
Bob: Yeah.
Alan: What else?
Bob: Yeah, there was– the VR
bumper car was another one that–
Alan: What?
Bob: Yeah, I know! So you take a
50 year old hard ride, you put a tracking system on it. You put on a
headset. And now all of a sudden they’ve gamified bumper cars, and
you’re in this cyberpunk environment. It was a joint venture between
a bumper car manufacturer called IE Park, a software company called
SPREE Interactive — which was formerly Holodeck VR — and a company
called VR Coaster, which did the first VR roller coasters. And the VR
roller coaster thing was a bit of a fad and it’s kind of dropped down
now, because there’s all kinds of throughput issues and roller
coasters are high throughput rides. But bumper cars are not, and
bumper cars are kind of boring and simple, and you’d never do it more
than once, right? And so they’ve taken bumper cars, they’ve made them
fun and engaging and replayable, and you’re going up a ramp and the
floor collapses and you feel like you’re free-falling. And yeah,
really amazing use of VR. And so that was– and that won a Brass Ring
award, which is one of the award ceremonies from IAAPA this year. So
I expect to see that in a lot of theme parks going forward.
Alan: That’s super cool. I want
to try that.
Bob: Yeah, it was good.
Alan: And rounding out the top
five?
Bob: Yeah, umm… Oh wow, top
five, so… boy, that’s a tough one.
Alan: What other Bauble Awards
were given?
Bob: Yeah, well I gave one to
Zero Latency, but that was like long overdue for their free room
stuff. And I will give, I still think it’s the best of the best in
the free roam space, but one of the things that they did — which is
speaking of brave moves — was they had developed– because they were
first, they developed their own tracking system, right? They had to
develop their own headset, their own gun, their own camera system
that used machine vision cameras, a stack of servers a mile high. It
was a very expensive installation. And when the Windows Mixed Reality
system came out — or before it came out from Microsoft — they were
the earliest adopter of that. And what they did was they made their
own stuff obsolete before their competition did. And it dropped the
price of their system in half, made it more accessible, made it more
flexible. And I think it’s really hard for companies that invent
solutions to let go of their own invention and adopt someone else’s
solution because it actually is better, cheaper, faster. And they did
that really early. And I rarely see entrepreneurs do that. There’s
that whole not-invented-here syndrome. And they’re so married to the
technology. And these guys — as technically proficient as they were
— just let go of that. And I think that was a really bold, brave
move by the founders of the company. And I think it’s paying off in
spades for them.
Alan: This is kind of the
approach we’ve taken at MetaVRse in building a new platform
marketplace. And we realize that, yes, we can make all sorts of great
tech. We’ve built all sorts of things; motion tracking, volumetric
capture. We’ve built all these things. But the technology’s moving so
fast and so rapidly that Microsoft, for example, they have their
Metastage is a million bucks plus. But there’s other people coming up
that can do that for $100,000.
Bob: Yeah, there was a company
at SIGGRAPH called IMVERSE. And they are doing it with the new Azure
Kinect cameras.
Alan: Exactly, exactly. And
that’s not difficult to do. So if you look at the technology in the
way it’s moving, my question is constantly, how do we disrupt an
industry constantly and consistently disrupting itself?
Bob: Yeah.
Alan: Our answer to that is to
build a marketplace that taps into all the newest technology for the
needs of our customers we’re corporate training and enterprise
training, that sort of thing. But being able to use all of the
latest, greatest technologies and apply it to that, because they will
change dramatically over the next five years, ten years.
Bob: Yeah, absolutely. And I
think — to get back to location based entertainment space — the
innovation that has to happen there is around the business models.
Because ultimately you’re selling tickets, and you’ve got to sell
enough tickets to pay for the hardware, before the hardware becomes
obsolete and you have to buy new hardware. And so I think that’s been
the challenge in that space is how do you buy something and know that
you’re gonna get a sufficient return on that invested capital, before
you have to either replace it or upgrade it. And I think that we’re
still sorting that out.
Alan: Well, I think the problem
is the headset turnaround times. So I think your maximum you’re going
to get out of any headset at this point is two years.
Bob: Yeah, but the headset’s the
least component of it. Like, the headset’s 500 bucks now, and the
prices are going to continue to come down. And so, for example, the
VRsenal cabinets sold for $40,000. If you have to upgrade the headset
every six months and it cost you 500 bucks, that’s almost an
insignificant amount of money. I think it’s– and that’s what I tell
operators, too, don’t get too caught up in the display technology
getting better and better, and faster and faster. I think that when
you look at the whole stack of what you have to do technology wise,
especially in the free roam space, like if you’d invested a half a
million dollars or three quarters of a million dollars into a Zero
Latency system with machine vision cameras, and now all of sudden you
can do it with inside-out tracking in the headset, you’ve literally
thrown away $200,000 with the hardware in twelve months. That’s hard
to recoup. And so with that, it’s the bigger systems, they have a
little more technical heft to it, a lot more infrastructure and
especially on tracking systems, which are essentially now going to be
free, which is awesome.
Alan: It is pretty awesome. And
you know–
Bob: If you didn’t buy one
yesterday.
Alan: [laughs] Yeah, it’s true.
And the inside-out tracking was kind of this unicorn myth that maybe
will come, and it came, and it came fast and it’s here. And it’s
just– that’s the new standard.
Bob: And it comes with some
limitations. But I’ve got to believe that those limitations are going
to go away, as like the peripheral vision, and if you move your hands
out from in front of your face, because they’re using the cameras now
for hand tracking as well. And so how do you track an object that
isn’t in your direct line of sight, whether it’s for hand tracking or
controller tracking or whatever. But I’m sure they’re going to figure
that out in the next 12 months.
Alan: I think honestly– and I
had Alvin [Wang Graylin] from HTC on, and they’ve kind of figured
this out a little bit with their Focus, they use inside-out tracking,
plus they use the base stations.
Bob: Yeah.
Alan: So you kind of have this
triangulated– I think he said with four base stations and the
inside-out tracking, you can go up to something like 20,000 square
feet. I didn’t understand how that was possible.
Bob: Yeah. And I think hybrid
tracking really is the future for the large free roam VR stuff. And a
combination of inside-out and outside-in is going to be where we are,
and that’s gonna be where we settle. But you won’t need $200,000 with
optical tracking cameras. You’ll be able to do it with a handful of
infrared laser cameras or whatever. But the prices of that stuff is
going to come down to the point where you can mix and match the
technologies into a solution that eliminate all the weak spots. And I
think that’s the next twelve months, that’s going to be where all the
evolution is in the technology of the out-of-home free roam space, is
those hybrid tracking systems.
Alan: Amazing. So we’ve gone
through a lot today, but what problem in the world do you want to see
solved using XR technologies?
Bob: That’s a great question.
Thank you. And this has nothing to do with location based VR or
entertainment. I want to see it being used for greater interpersonal
connection, and to create safe spaces for people to be more
vulnerable in their communications. And I think that that’s one of
the greatest challenges that we have in society today, is kind of a
loneliness problem, this leading to an epidemic of suicide and
depression. And I think that it’s a really powerful tool. And as we
get better virtual telepresence and more avatars that are more
communicative. I don’t think they have to be photorealistic, but I
think using– I want to see people using the technology to bring
people closer together. Think about the combination of language
translation and virtual telepresence, and how that breaks down the
boundaries, the geopolitical boundaries that keep us separated as
humans around the world. That’s what I want to see.
Alan: That’s an amazing vision.
And I think we’re only a few years away from that being ubiquitous.
Bob: I think within five years
we’ll be able to have face-to-face meaningful communication across
borders and across languages. And that’s going to put a lot of
pressure on governments, and the people who want to keep us separated
for all kinds of reasons. And so it’ll be interesting to see how that
ripples through the geopolitical society of the world in the next
five years. It’s going to be– it’s a fascinating time to be alive.
Alan: It really is. Thank you so
much, Bob. This has been amazing.
Bob: My pleasure. Thanks for
having me.
39 min
March 03, 2020 IAAPA Update from Location-Based VR Expert, Bob Cooney
Today’s guest, location-based VR expert Bob Cooney, has been in the XR space since the early 1990s. He drops by the show to give Alan an update on all the newest tech advances he saw at the International Association of Amusement Parks and Attractions Expo, and explains how today is the most exciting time to be working in this industry.
Alan: Welcome to the XR for
Business podcast with your host, Alan Smithson. Today’s guest is
always on the bleeding edge of technology. He’s able to predict both
tech and business trends. Bob Cooney is widely considered one of the
world’s foremost experts on location based virtual reality, and the
author of the book “Real Money from Virtual Reality.” I’m
really super excited to introduce my good friend and colleague, Bob
Cooney to the show. Welcome, Bob.
Bob: Oh, dude, I’m so happy to
be here. Thanks for having me, Alan.
Alan: It’s my absolute pleasure.
It’s been a long time coming, this interview. But we’re here. We’re
excited. And we just are coming off the heels of *the* major North
American show, IAAPA — which for those of you listening and you
haven’t been there — it’s basically Disney World for VR, AR, and
out-of-home experiences. You were there. Let’s talk about what you
saw, and what are the trends coming in out-of-home entertainment.
Bob: Yeah, it’s an amazing show.
I’ve been going this– I think this is my 27th IAAPA or something
like that. And my first one was 1991. And over the last four or five
years we’ve seen VR every year just grow in not only the number of
companies bringing VR/AR solutions into the market — mostly VR at
this point — but the quality is every year measurably increasing.
And that’s the thing I think that has me so excited is three or four
years ago there was just a literally handful of things that you would
even remotely consider as an operator. And last year there was
confusion now, because there was– you were starting to see a lot of
good stuff and this year it was just overwhelming. And so, yeah,
we’ve seen real quality come into the market.
Alan: You’ve seen pretty much
everything there is out there. What’s one thing that blew your mind
this year?
Bob: Good question. The rise of
unattended virtual reality systems. There was a company called LAI
Games, which has been around for decades. They’re based out of Asia.
They build arcade games. And a couple of years ago, they took a
license from Ubisoft: Raving Rabbids, which is a really popular IP.
They merged it with a D-Box motion base and they created a VR ride
for family entertainment centers, arcades, and theme parks. It’s a
two player ride. It was fairly cost effective, but they recommended
it be operated without an attendant, and it was the first VR
attraction that came out where you didn’t need to staff it. And the
profitability of that really made a big difference for operators. And
now this year there was another company called VRsenal, that had an
arcade game cabinet with– that was a VR based that was unattended,
and it was running Beat Saber, which is obviously one of the most
popular games out there. And so we’re starting to see companies
realize that maybe we don’t need attendants. Maybe people are smarter
than we give them credit for. Maybe they can figure out how to put a
headset on their face. Maybe they will clean it by themselves if they
care about that. And so I talk about a lot about the four-minute
mile, once it was broken. People thought was impossible, people
thought if you try to run a four-minute mile, you would die. And once
it was proven that it could be done, hundreds of people have done it
since. And I think this notion of unattended VR is similar to that.
And we’re going to start seeing more companies give more credit to
consumers, that they’re smarter than we think they are.
Alan: When I was in China, they
have VR kiosks in a lot of the malls and some are attended, some are
unattended. But I– I remember I was walking through the mall and I
was like, “Oh man, VR!” and pull out my phone to videotape
it — because this was two years ago — and I watched somebody fall
completely on their butt, because they were downhill skiing in an
unintended thing and they fell on their butt, and then they got back
up and did the thing. And then I was in another mall, videotaping a
kid in VR and he fell on his butt. So there are still some risks with
this. How are they mitigating that? Because I know the Rabbids one is
using a D-Box and you sit in it. So is that kind of what you’re
seeing? Because I know with Beat Saber, for example, you’re not–
there’s no real risk of falling over.
Bob: There’s risk of somebody
walking into your space and whacking them–
Alan: Oh, yeah.
Bob: –over, right? And so what
the arcades are doing is they’ll put rope stanchions around those. I
think the seated motion simulators are pretty safe. One of the
Facebook groups yesterday, somebody posted how their son was in the
hospital with a chipped tooth and a broken ankle from playing VR and
falling. I don’t know what game they were playing, but they fell and
hit their head on the table. And so there are some real risks around
VR, that could limit adoption. And that’s– certainly on the consumer
side, I think that’s a problem.
Alan: So, Bob, how are these
companies mitigating this risk, or what are you’re seeing that’s
mitigating this?
Alan: I think operators and
setup and safety is important. A lot of them are putting the
unattended stuff in view of like a redemption center, where there’s
always somebody behind the counter redeeming tickets for prizes. I
think the Beat Saber arcade game, they’re putting rope stanchions
around them or cordoning it off, so people don’t walk into the space
where somebody is actually playing the game. I think the seated stuff
is inherently safe. There’s always a chance to get toes can get
crushed, and things like that if people are careless. But I think
that’s something operators have been dealing with since the very
first driving games that had motion’s systems built into them. And I
do think it’s one of the things that could really slow consumer
adoption, though. If you remember the Wii when it first came out,
people were smashing televisions with controllers playing tennis.
Alan: It’s interesting you say
that, because we’ve been doing demos with the Quest, and the same
thing. You set it up, you set up stanchions. And it doesn’t matter.
People still– they get excited. They get in there. They don’t
realize they totally lose control. That’s the power of VR, they get
right in there. And we’ve had somebody get punched in the face with a
controller recently. And it was like, “Oh, jeez.” They
weren’t within the stanchions. They were outside of it. And they
just– the person lunged out of nowhere.
Bob: It’s the paradox of
presence, right? I mean, you’re–
Alan: Yeah.
Bob: –you’re really present in
the experience. You forget where you are. The fantasy-reality line
blurs. And then next thing you know. And that’s the inherent problem
with it, is that that’s– in order for it to be effective, it’s not
going to go away. And so I think safety systems– and you know, one
of the things I would expect is as inside-out tracking gets better
and the cameras get better, if you get too close to an object maybe
the pass-through video kicks on. They’re going to have to figure out
a way to make this stuff safer overall.
Alan: Yeah, the way the Quest
did it, where you can draw out your boundaries and then if you walk
through the boundaries, it goes from being in virtual reality to
being in the real world or pass-through camera. That actually a
really nice solution. What we’ve been doing now is putting people in
VR when they’re outside of the boundary, and then having them walk
into it. And it’s this kind of a-ha moment, where they go from the
real world of crappy pass-through camera to the completely virtual
world. And it’s that moment of delight that you see. Now, speaking of
moments of delight, because you get to see not only try these
experiences, but you’re really intuitive into the emotions that
people are feeling when they’re on the rides. What are some of the
rides or experiences that you’re seeing that really resonate with
people?
Bob: Yeah, look, I think that–
it’s funny. There’s a narrative in the industry that we have too many
zombie shooters, but the numbers show that that’s actually what
people want to play. And people love horror, horror’s had another
blockbuster year in Hollywood, and I think people like to be scared.
And that’s one of the easy emotions that you can trigger is fear. And
so whether it’s Richie’s Plank in fear of heights, or zombie outbreak
shooters and stuff like that, I think people love to be scared. And
the interesting thing is, statistically, women like horror more than
men. There’s all these great viral videos out there about women
screaming in these zombie shooters. But I think that’s the thing that
really triggers emotion, is that fear is the easy one. It’s the low
lying fruit. And I know companies that have put out multiple titles,
but their horror titles are always their number one earning and
number one ticket seller. And so I think you’re gonna continue to see
that, until we figure out how to really tell stories and drive other
types of emotion in VR. And I still haven’t seen a lot of that yet.
Alan: What about racing games? I
tried one the other day and it was absolutely mind-blowing. It was a
6DOF simulation machine. So the whole thing was riding on multiple
pivot angles. And when I hit a bump on the road, I felt the bump on
the road. It was just– and when I hit the wall — of course, going
too fast — I hit the wall and the whole thing just rattled me. It
was wild.
Bob: Yeah, look, I think that
there’s a lot of bad motion simulation out there in VR, which
triggers motion sickness. If it’s not done well, it can actually
exacerbate the simulator sickness that you get. There are a couple of
companies that seem to be doing good. Like I did Mario Kart VR from
Namco, which is a really fun game. And I think that that makes sense
to have in VR too, because you have to look over your shoulder to see
where your competition is, to see who’s going to throw things at you
or you can throw things. One of the surprise hits from the IAAPA show
— to go back to that — was a company called UNIS out of Taiwan, I
think they’re based, they had a two player motorcycle VR simulator
and it was a track racing motorcycle game. And when you’re leaning
into the turn or looking over your shoulder, that presence of VR and
to be able to look behind you and see your competition coming up to
you was really well executed. And so I think– and I got no motion
sickness at all out of it. So it was really well done. So I think
companies are getting better at it, and they’re using it in
appropriate ways. I think that my personal opinions in a drive racing
simulator in a car, you have mirrors, like you don’t look over your
shoulder. And so I don’t know what advantage VR really brings. The
resolution isn’t as good. The frame rate is not as good as you can
get in a big monitor. I almost feel like for driving simulators,
you’re better off with a really good 4K monitor at 200 frames per
second with good mirrors.
Alan: The one that blew my mind
was three panels kind of stuck together.
Bob: Exactly. I think that’s a
much better use of the technology. Totally agree.
Alan: It was wonderful. I did
drive– because I was at the I/ITSEC show, the Industry– Inter–
Bob: Big military simulation
show.
Alan: Big military simulation
training. So I got to drive a tank, that was cool. I got to fly a
helicopter, which was interesting. I crashed it, dramatically. The
guy’s like, “I don’t think I’ve ever seen anybody crash this
thing like this.” [chuckles] But here are multi, multi-million
dollar simulators, and they’re not as good as the ones that are at
IAAPA.
Bob: Yeah, that’s interesting.
And I think that– how much of that is just because the military is
used to overpaying for everything — we’ve all heard about the $9,000
hammer and the $40,000 toilet — and how much of that is just the
nature of the accuracy. Like one of the things I did some work with
zero latency and they did some work with the Australian Army in
building simulations. And one of the things that everything has to be
about muscle memory when you’re in the military. And so these
simulations have to be incredibly accurate down to button placement
and things like that. And because it’s generally lower volume, I
wonder if that has a lot to do with it.
Alan: It could be, actually. It
could be the rigorous demands from the client, but also the fact that
they’re not buying hundreds of them, they’re buying tens of them.
Bob: Yeah, totally.
Alan: Makes sense. And then, of
course, everything’s custom for them and you can’t share the content
out. So there’s that.
Bob: Yeah. And look, I think the
military has been doing this stuff for a long time. And we saw a
couple of military simulation companies kind of stick their toe in
the amusement water. And that happened a lot with companies like
Doron Simulation, they did military simulators and wound up going to
doing some big, large format, large capacity motion simulation in the
amusement industry. And I think there’s been some cross-pollinization
between the military, some companies and the amusement and
entertainment sector companies. I think on a smaller scale stuff,
that’s more in the game space. That’s just I just don’t think they
get that mark. There was a company called Raydon — who was probably
at I/ITSEC — who was a client of mine a couple of years ago. They
brought a 50 cow simulator, and they put it in kind of an arcade
cabinet and created a game that was kind of like space bugs — think
Starship Troopers — with this giant 50 cow simulator, and a
butt-kicker on it to create recoil. And it was called Total Recoil.
It was a great experience. But entering into the arcade game
business, they really [went] from being a military contractor, just
chalk and cheese. And I think they struggled to try to make something
that was inherently fun and replayable. I think that’s one of the big
challenges in the entertainment industry, is people are looking for
games they want to play over and over again. And training simulation,
you’re doing it for a different reason. It doesn’t have to really be
replayable from a fun standpoint. And I think that there are real
skills in creating games regarding core loops and dopamine rushes and
things like that, that get you don’t want to play it again, that the
military companies just don’t need to understand.
Alan: So let me ask you a
question, Bob, because this really intrigues me. You talk about these
things that make something replaceable, and how maybe military sim or
even training is not looking for that. But shouldn’t we — as people
creating training simulations — be thinking about that? Because if
we make it so that people want to do it over and over again, and have
that repeatability, and that want to play it again, wouldn’t that
kind of increase their ability to become proficient in whatever it is
they’re training?
Bob: Yeah, absolutely. But I
think it’s a different mindset. So when you’re training to become
better at something, that’s a mindset. And when that’s my profession,
I’m driven to do that. When I go to have fun, I’m not necessarily in
the mindset to improve. Now, there’s a narrow slice of the
psychographic market, that will say “I just want to get better
and better, and I want to prove, I want to play against myself, I
want to beat my high score.” That’s where the leaderboards and
stuff comes in. But it’s not actually the broad market for VR. We
find the broadest market for VR is casual impulsive entertainment.
People just looking to go out and have a good time with their
friends, and to have a story to tell. And so I think you have to
really know your market. If you’re building entertainment products,
know who your target consumer is and build for them. And there’s a
lot of people now building these kind of PVP — player versus player
— e-sports games, that are highly competitive and they’re not
earning very well so far. I mean, there’s a couple of them that are.
I know Virtuix, the Omni arena’s doing really well in its early test
locations. They got about–
Alan: Yeah, how’s that going? I
actually tried the Cyberith one at the I/ITSEC show. And it was
interesting– and for people listening, if you don’t know, it’s a
kind of redirected walking. What would you call it? Omni-directional
treadmill kind of thing. So the one I tried, you’re strapped in at
your waist, and you’ve got these slippery shoes on, and you just walk
in any direction you want to go. But what I found was I felt totally
hammered drunk, walking around in that thing.
Bob: [laughs]
Alan: Like, I had no control. I
kept falling over and like, because you’re strapped in anyway,
doesn’t matter, you can’t really fall. But I just felt like I
couldn’t walk in a straight line. I was like, if somebody gave you 20
shots of tequila and then said “Walk down the street,”
that’s what I felt like. I was all wobbly kneed and it was not the
most fun experience, but I guess with practice it might feel better.
Bob: And I think some of that is
in the interface in between the hardware and the software and the
control mechanism. I think if you try to use that as just a human
input device, it’s going to be difficult. And I think there are some
companies do that. I think Virtuix invented the device, they’ve been
doing it for six or seven years. I think they’ve kind of perfected
that. And even with that, it can be a little awkward. But once you
get into it, it’s the closest thing you can do to running in VR. And
there’s just something visceral about dual wielding shotguns in a
zombie apocalypse and running around. And the head is just– there’s
something magic about that, Alan, I can tell you.
Alan: It’s interesting. I got to
try another walking simulator — and I’ll look it up while we’re
talking — but it was walking on a treadmill. It was bi-directional
treadmill. So wasn’t omni-directional, it was just bi-directional.
But the way they had coded the experience, as long as you stayed
within a green circle, you could just keep walking. And my first
thought– because the first thought is I’m going to walk into
something, because I’m in this big kind of thing. And then when you
take a few steps, after about the tenth step, you’re like, “Wait
a second. This is really cool. I’m walking and yet I’m not any closer
to the wall.”
Bob: Yeah. And one of the things
we saw in the large scale free roam — like the big warehouse scale
free roam experiences — is the longer– the further you walk, the
deeper the immersion goes.
Alan: Yeah.
Bob: Because eventually that’s
what happens, your mind says, “OK. Actually, I am walking. I’m
in a bigger environment. I’m not going to walk into something.”
It lets go of that reality. And you enter that fantasy world where
you realize you’re in this environment. And if you can do that for a
few minutes– some of these experiences, I’ve traveled as much as a
half a kilometer. And the immersion gets really, really deep when
you’re in it for a half an hour and you’re just walking around
freely.
Alan: That’s crazy. So, you
know, in a business where square footage matters, one of the things
that the Void did really well is they employed redirected walking or
the ability to kind of use the same set for multiple pieces of
content in a very small footprint. What are you seeing around that
sort of location based entertainment where they take over the whole
space?
Bob: Yeah. And I think all of
the companies that started out with these big warehouse scale stuff
are looking at realizing the economics. A, there’s an economic piece
of it and B, there’s just finding locations with 2,000 square feet of
open space without pillars in an urban environment can be really
hard. I know a guy that was looking in London for a year trying to
find a location for Zero Latency location, and he couldn’t. So I
think there’s a couple of drivers there. One is just the cost and one
is availability of space. And so they’re all trying to figure out how
to go smaller and smaller and smaller. But those are tradeoffs,
right? I mean, the very first free roam space I played was 4,000
square feet or 400 square meters. It was a 15-minute game and it was
amazing. But how many places can you operate? Something like that.
And I think there’s one in Chicago, mass VR that’s on that scale,
too. But I don’t think they’ve ever opened a second location. So,
yeah, I think that there’s a lot of tradeoffs. And look, from an
operating model standpoint, everybody’s still trying to figure out
where the sweet spot is. You know, The Void is still struggling to
try to figure out these single unit economics. I think Dreamscape is
still trying to figure it out. Even Zero Latency, I think they just
opened like their 37th location in Barcelona now or something last
week. But I know I’ve spoken to all of their operators, and some of
them make money and some don’t. None of them are really getting their
money back as fast as they wanted to. And so I think that the
business models are still being fleshed out, and finding that– once
people figure out the sweet spot, everybody will rush into it. And
the fact that people are still experimenting tells me nobody’s really
figured it out yet.
Alan: It’s interesting you say
that, because I think that’s indicative of the whole industry. VR,
AR, from a corporate standpoint, we’re really just touching the
surface of what’s possible and the business models around this. You
know, it’s funny. We’re writing financial models for a company and
they’re like, “Okay, here’s the products, here’s the clients we
want to go after.” And I said, “Guys, you realize that
everything we’re doing here is just a complete guess, and it’s all
going to be wrong.” Like, literally no rhyme or reason for it,
because as we move, the industry is shifting. And I say to this to
people, “It’s not just a new technology, it’s a new industry,
it’s new business models. Everything’s unproven.” So how do you
then– I guess you just got to keep experimenting, which was what
everybody’s doing.
Bob: I tell people, this is the
most complex market you can imagine. And the solution for solving
complex problems is sitting in the problem space longer. Einstein
said, “I’m not smarter than everybody else. I just sit with my
problems longer.” And I think he was lying about that, he was
smarter than everybody else. But he did sit with the problems. And
there’s a really interesting thing for the listeners, if you Google
the “Snowden leadership framework”, it’s a Harvard Business
Review article, it was back in the 90s. And they talk about this
thing called the Cynefin model — and it’s a Gaelic word — and they
talk about how to deal with different levels of complexity. And they
say, in a complex market you have to stop trying to find the solution
right away. And I think VR is that, and you’re seeing a lot of
companies experiment and share the opening. And the thing I love
about this industry is everybody seems willing to share with most
people. Because they know it’s day one, they know we haven’t tapped
the beginning of the market, and it’s not a zero sum sum game.
Everybody can still win at this stage of the business. So there’s a
lot of sharing and a lot of experimentation happening. And I love
that.
Alan: Yeah. It’s really a
wonderful industry to be in. I came from the music industry and music
technology, and it was — I guess — a more mature industry. So there
was sharing, but not really kind of at the level where it’s like,
here’s all my information or I’m on a podcast telling everybody about
how VR and AR is working for our business. And even just on this
podcast — the XR for Business podcast — we’ve seen a really
incredible sharing of knowledge. And I think this is one of the best
things about this industry, is people are willing to help. And like
you mentioned, it’s not a net sum game at all. The industry — as an
entire industry — is about $10-billion in 2019, will close off the
year between 10 and 11 billion. And that’s going to increase to
500-billion by 2030.
Bob: There’s plenty of room for
everybody. If new entrants stopped coming into the market, everybody
in the business today that survive would be a billionaire. So that’s
not going to happen, because people are continuing to rush into the
market. But yeah, there’s plenty of room for everybody right now. And
it’s really exciting to have been watching the industry grow, like I
did my first VR product in 1992. I’ve been watching this thing bubble
up for 25 years and and it’s nice to have some–
Alan: Is now the time or what?
Bob: Oh, absolutely. Zero doubt
in that. I think the technology just wasn’t there before. And the
mobile phone revolution with really inexpensive accessible small high
resolution LED screens or LCD screens, and IMUs, and tiny processors,
and all of the components that Palmer Luckey needed to build his
first Oculus headset came out of the cell phone industry. And so we
can thank the cell phone guys for making all this possible.
Alan: Well, speaking of cell
phone guys, you’ve got HTC as a major player. They actually sold
their cell phone division to Google to focus on VR.
Bob: Man, that was crazy. Like–
Alan: I agree.
Bob: Talk about a bold move. And
I hope they’re successful, because I love to see bold business moves
rewarded. But that was a pretty risky move, but talk about belief.
That’s the manifestation of belief.
Alan: Yeah, it’s focused, too.
If they’re all in on spatial computing in the future of this, and
they seem to be doing well. Out-of-home entertainment locations, I
would say HTC is probably the leader.
Bob: Oh, by far. Like, not
even– nobody’s even a close number two right now. And some of that
has been attitude. I mean, Rickard Streiber early on realized that
they had an awareness problem. He said, “All right, let’s
support the arcade business, because that’s where people can at least
get an idea of what VR is like.” And I criticized him publicly a
little bit, because the arcade owners back in the 80s, that whole
business got basically disintermediated by the consumer gaming
market. So once console systems got really good and really
affordable, people stopped going to arcades. And so in a way, he was
trying to get arcade people to build VR arcades, so people would be
able to buy VR at home, and it would put the arcades out of business.
And now that we’re starting to see more free roam and less consumer
adoption than anybody expected, I think that those models are
starting to solidify a little bit. But HTC saw early on that they had
an awareness problem and they are trying to fix the awareness
problem, whereas Oculus thinks they have a pricing problem. And so,
you know, they come out with a Quest and they come out with the Rift
S, and they give really hard technical limitations to both of them to
hit a $399 price point, thinking that’s going to move the market. And
so two different companies with two entirely different beliefs of
what the problem is. It’ll be interesting to see how that plays out
this Christmas.
Alan: Have you tried the Quest?
Bob: I have, yeah. In fact, I
just ordered one. I tried it early on, before it was released.
Obviously, I get to demo a lot of cool shit that’s in development.
One of the nice things about my job. But I finally broke down and
ordered one, and I’m going to see if I can’t travel with it, because
I get so many people that I meet that haven’t tried VR, and I want to
be able to just put a headset on them and say, “Check this shit
out.” Am I allowed to say that on your podcast?
Alan: You’re allowed to say
whatever you want, my friend. Now, this is a family show, but I
believe that if you’re passionate about something, these things come.
Bob: Yeah, so. And funny, what
got me over the line — because I’m a consumer — was they bundled
Vader Immortal with it for Christmas. And so they’re starting to
learn about the whole notion of bundling, and what’s going to drive
adoption. And then they just then– obviously they announced they
acquired Beat Games last week.
Alan: Yeah, that was cool.
Bob: I wrote a blog post about
that. And by the way, if anybody’s interested, I write a weekly blog
on location based VR at bobcooney.com called Dropping In. So if
you’re interested, check that out. But my blog post last week was
about the Facebook acquisition of Beat Games and how– try to figure
out why they did it. If you think back to the music games of Guitar
Hero and Rock Band, those peripheral kits were really expensive.
Couple of hundred bucks for the whole band set. 300 bucks, 350 for
the Beatles one. And so I think music games have the ability to sell
hardware. And I think Facebook realizes that. And they decided to buy
Beat Games. They’re going to push that hard. And then you’re going to
see a lot of new music coming in. It’s really exciting time. How
happy am I for those guys, the guys that started Beat Games and
cashing out, hopefully they made a bajillion dollars.
Alan: [chuckles] We’ll never
know how much they’re going to make. I think it was–
Bob: But hopefully those guys
cleaned up. I love seeing entrepreneurs make money.
Alan: Hopefully they also keep
Beat Saber available on other platforms.
Bob: Yeah, absolutely. And they
have to. Well, they don’t have to, actually. And I think that there
would be a massive community backlash if they didn’t, at this point.
And you know, Oculus and Facebook, they’re undergoing all kinds of
scrutiny from all kinds of people. And they’re going to have–
they’ve got to be careful with everything that they do right now, and
how it affects their brand and people’s perception of them.
Alan: Agreed. So let’s go back
to IAAPA for a second. If you were to say that these are the five
highlights of IAAPA this year, what would they be?
Bob: Yeah, for me, I actually
gave out– I have created my own award called the VR Bauble Award.
And for recognition of companies that are really doing not only good
stuff, but innovative stuff in the space. And Rabbids: The Big Ride
was one of them. The VRsenal unattended Beat Saber cabinet was one of
them. And there was one that really caught me by surprise, was a
company called Ballast– DIVR, they had a product called Ballast, and
I had to actually throw on board shorts and get in a pool to try it.
And they have a waterproof headset basically built into a scuba mask
with a snorkel. And you hold on to one of those underwater propulsion
devices — like a little torpedo thing that you hold on to — and
it’s hooked up to an air compressor, so it cavitates and there’s a
fan that blows jet– a jet that blows the water on you. So you feel
like you’re moving underwater. And it was mind blowing, it was
fantastic. I was like screaming through my snorkel. And I think that
from a business model standpoint, you’ve got all of these resorts
around the world that have pools that are underutilized and
unmonetized. And now all of a sudden, you can drop 100 grand worth of
equipment in there, and charge 20 bucks for a seven minute underwater
VR experience and start monetizing pools. And I think you’re gonna
see resorts do that. And so that product blew me away. It was really
surprising.
Alan: That is super cool. Think
about this, for all the people going on vacation over the holidays,
how much can you really drink by the pool?
Bob: Yeah.
Alan: Don’t answer that
question.
Bob: And the ability– one of
the experiences was like free floating in space. So when you get in a
weightless pool environment, there’s all kinds of things you can do.
So I was jetting through the lost city of Atlantis, but then all of a
sudden I was free floating in space in the International Space
Station. And that was really cool. And being in the water removes any
notion of motion sickness as well. So super accessible. So that was–
yeah, that was a great– that was just a mind-blowing experience for
me. It really changes the game when you can start doing VR in water,
that was amazing.
Alan: Super cool.
Bob: Yeah.
Alan: What else?
Bob: Yeah, there was– the VR
bumper car was another one that–
Alan: What?
Bob: Yeah, I know! So you take a
50 year old hard ride, you put a tracking system on it. You put on a
headset. And now all of a sudden they’ve gamified bumper cars, and
you’re in this cyberpunk environment. It was a joint venture between
a bumper car manufacturer called IE Park, a software company called
SPREE Interactive — which was formerly Holodeck VR — and a company
called VR Coaster, which did the first VR roller coasters. And the VR
roller coaster thing was a bit of a fad and it’s kind of dropped down
now, because there’s all kinds of throughput issues and roller
coasters are high throughput rides. But bumper cars are not, and
bumper cars are kind of boring and simple, and you’d never do it more
than once, right? And so they’ve taken bumper cars, they’ve made them
fun and engaging and replayable, and you’re going up a ramp and the
floor collapses and you feel like you’re free-falling. And yeah,
really amazing use of VR. And so that was– and that won a Brass Ring
award, which is one of the award ceremonies from IAAPA this year. So
I expect to see that in a lot of theme parks going forward.
Alan: That’s super cool. I want
to try that.
Bob: Yeah, it was good.
Alan: And rounding out the top
five?
Bob: Yeah, umm… Oh wow, top
five, so… boy, that’s a tough one.
Alan: What other Bauble Awards
were given?
Bob: Yeah, well I gave one to
Zero Latency, but that was like long overdue for their free room
stuff. And I will give, I still think it’s the best of the best in
the free roam space, but one of the things that they did — which is
speaking of brave moves — was they had developed– because they were
first, they developed their own tracking system, right? They had to
develop their own headset, their own gun, their own camera system
that used machine vision cameras, a stack of servers a mile high. It
was a very expensive installation. And when the Windows Mixed Reality
system came out — or before it came out from Microsoft — they were
the earliest adopter of that. And what they did was they made their
own stuff obsolete before their competition did. And it dropped the
price of their system in half, made it more accessible, made it more
flexible. And I think it’s really hard for companies that invent
solutions to let go of their own invention and adopt someone else’s
solution because it actually is better, cheaper, faster. And they did
that really early. And I rarely see entrepreneurs do that. There’s
that whole not-invented-here syndrome. And they’re so married to the
technology. And these guys — as technically proficient as they were
— just let go of that. And I think that was a really bold, brave
move by the founders of the company. And I think it’s paying off in
spades for them.
Alan: This is kind of the
approach we’ve taken at MetaVRse in building a new platform
marketplace. And we realize that, yes, we can make all sorts of great
tech. We’ve built all sorts of things; motion tracking, volumetric
capture. We’ve built all these things. But the technology’s moving so
fast and so rapidly that Microsoft, for example, they have their
Metastage is a million bucks plus. But there’s other people coming up
that can do that for $100,000.
Bob: Yeah, there was a company
at SIGGRAPH called IMVERSE. And they are doing it with the new Azure
Kinect cameras.
Alan: Exactly, exactly. And
that’s not difficult to do. So if you look at the technology in the
way it’s moving, my question is constantly, how do we disrupt an
industry constantly and consistently disrupting itself?
Bob: Yeah.
Alan: Our answer to that is to
build a marketplace that taps into all the newest technology for the
needs of our customers we’re corporate training and enterprise
training, that sort of thing. But being able to use all of the
latest, greatest technologies and apply it to that, because they will
change dramatically over the next five years, ten years.
Bob: Yeah, absolutely. And I
think — to get back to location based entertainment space — the
innovation that has to happen there is around the business models.
Because ultimately you’re selling tickets, and you’ve got to sell
enough tickets to pay for the hardware, before the hardware becomes
obsolete and you have to buy new hardware. And so I think that’s been
the challenge in that space is how do you buy something and know that
you’re gonna get a sufficient return on that invested capital, before
you have to either replace it or upgrade it. And I think that we’re
still sorting that out.
Alan: Well, I think the problem
is the headset turnaround times. So I think your maximum you’re going
to get out of any headset at this point is two years.
Bob: Yeah, but the headset’s the
least component of it. Like, the headset’s 500 bucks now, and the
prices are going to continue to come down. And so, for example, the
VRsenal cabinets sold for $40,000. If you have to upgrade the headset
every six months and it cost you 500 bucks, that’s almost an
insignificant amount of money. I think it’s– and that’s what I tell
operators, too, don’t get too caught up in the display technology
getting better and better, and faster and faster. I think that when
you look at the whole stack of what you have to do technology wise,
especially in the free roam space, like if you’d invested a half a
million dollars or three quarters of a million dollars into a Zero
Latency system with machine vision cameras, and now all of sudden you
can do it with inside-out tracking in the headset, you’ve literally
thrown away $200,000 with the hardware in twelve months. That’s hard
to recoup. And so with that, it’s the bigger systems, they have a
little more technical heft to it, a lot more infrastructure and
especially on tracking systems, which are essentially now going to be
free, which is awesome.
Alan: It is pretty awesome. And
you know–
Bob: If you didn’t buy one
yesterday.
Alan: [laughs] Yeah, it’s true.
And the inside-out tracking was kind of this unicorn myth that maybe
will come, and it came, and it came fast and it’s here. And it’s
just– that’s the new standard.
Bob: And it comes with some
limitations. But I’ve got to believe that those limitations are going
to go away, as like the peripheral vision, and if you move your hands
out from in front of your face, because they’re using the cameras now
for hand tracking as well. And so how do you track an object that
isn’t in your direct line of sight, whether it’s for hand tracking or
controller tracking or whatever. But I’m sure they’re going to figure
that out in the next 12 months.
Alan: I think honestly– and I
had Alvin [Wang Graylin] from HTC on, and they’ve kind of figured
this out a little bit with their Focus, they use inside-out tracking,
plus they use the base stations.
Bob: Yeah.
Alan: So you kind of have this
triangulated– I think he said with four base stations and the
inside-out tracking, you can go up to something like 20,000 square
feet. I didn’t understand how that was possible.
Bob: Yeah. And I think hybrid
tracking really is the future for the large free roam VR stuff. And a
combination of inside-out and outside-in is going to be where we are,
and that’s gonna be where we settle. But you won’t need $200,000 with
optical tracking cameras. You’ll be able to do it with a handful of
infrared laser cameras or whatever. But the prices of that stuff is
going to come down to the point where you can mix and match the
technologies into a solution that eliminate all the weak spots. And I
think that’s the next twelve months, that’s going to be where all the
evolution is in the technology of the out-of-home free roam space, is
those hybrid tracking systems.
Alan: Amazing. So we’ve gone
through a lot today, but what problem in the world do you want to see
solved using XR technologies?
Bob: That’s a great question.
Thank you. And this has nothing to do with location based VR or
entertainment. I want to see it being used for greater interpersonal
connection, and to create safe spaces for people to be more
vulnerable in their communications. And I think that that’s one of
the greatest challenges that we have in society today, is kind of a
loneliness problem, this leading to an epidemic of suicide and
depression. And I think that it’s a really powerful tool. And as we
get better virtual telepresence and more avatars that are more
communicative. I don’t think they have to be photorealistic, but I
think using– I want to see people using the technology to bring
people closer together. Think about the combination of language
translation and virtual telepresence, and how that breaks down the
boundaries, the geopolitical boundaries that keep us separated as
humans around the world. That’s what I want to see.
Alan: That’s an amazing vision.
And I think we’re only a few years away from that being ubiquitous.
Bob: I think within five years
we’ll be able to have face-to-face meaningful communication across
borders and across languages. And that’s going to put a lot of
pressure on governments, and the people who want to keep us separated
for all kinds of reasons. And so it’ll be interesting to see how that
ripples through the geopolitical society of the world in the next
five years. It’s going to be– it’s a fascinating time to be alive.
Alan: It really is. Thank you so
much, Bob. This has been amazing.
Bob: My pleasure. Thanks for
having me.
39 min

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