Understanding the Maturation of Human-machine Interface Technologies

The rise of gaming’s prominence within popular culture has coincided with the maturation of human-machine interface technologies that make entertainment, learning, and interaction more immersive. This broad immersive entertainment category reaches beyond gaming use cases and includes virtual and augmented reality hardware and experiences. Tech giants and consumer electronics/gaming ecosystem players see opportunity in a metaverse construct as the next generation of immersive experiences.

The metaverse represents a generational opportunity to create a dominant consumer interactivity platform on the scale of the web.

• Spanning devices, platforms, applications, content, and transactions, the metaverse—built on extended reality (XR) technologies—enables disruptors to challenge the dominance of mobile platforms. In a fully realized metaverse, consumers could do virtually anything possible in digital platforms such as smartphone apps while also gaining unprecedented benefits from contextual content in the physical world.
• While virtual reality (VR) and smartphone-based augmented reality (AR) have served as proof of concept for immersive interaction, realizing the full potential of the metaverse requires next-generation smart eyewear or advances in projection technology for seamless multiuser experiences.
• Despite a common technology foundation at opposing ends of the XR immersion spectrum, VR and AR will diverge in the near-term consumer market. VR applications will focus on premium gaming experiences while AR applications will transcend games to focus on broader lifestyle applications associated with smartphone apps. Smartphone incumbents, including Apple, Google, Samsung, and Qualcomm, are best positioned to capitalize on AR.

Conceptually, the metaverse is catching up to VR in terms of consumer familiarity. According to Parks Associates, 27% of US internet households report they are familiar with the metaverse despite the term entering broad use only in 2021.  Currently, almost 13 M US internet households own a VR headset.

Younger generations (Gen Z and Millennials) are more often familiar with the metaverse concept than even those in households with >$75K HH income, a segment often having early familiarity with new technology products. With their embrace of video chat filters, Gen Zers are nearly twice as likely to be familiar with AR-related experiences, but more future-looking concepts such as the metaverse and AR headsets register a smaller Gen Z advantage.

This is an excerpt from Parks Associates just published research, Immersive Entertainment – AR, VR, Metaverse. This consumer study of 10,000 internet households examines immersive entertainment adoption and perspectives today, with competitive insights on key players’ performance in the VR and AR markets. It also assesses consumer attitudes toward VR, barriers to adoption, and familiarity with metaverse concepts.

 Key Questions:

1. What established industry models are VR and AR moving toward?
2. What is consumer familiarity with the metaverse terms, and how appealing are early metaverse concepts?
3. What is the current level of consumer adoption of immersive entertainment technologies? How frequently do they engage in them?
4. What are consumers’ perceptions of the VR experience?
5. What experiences are consumers most likely to adopt?
6. What roadblocks or bottlenecks are inhibiting consumer adoption or usage of these technologies? How might disruptive entrants affect this?
7. What companies or ecosystem owners are best positioned to deliver metaverse technologies?

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