Interview: Lenovo on the development of enterprise AR/VR devices, the hype surrounding the Metaverse and more

Vishal Shah, who leads Lenovo’s XR and Metaverse businesses, has a job that requires him and his team to look beyond the smartphone revolution and lay the groundwork for the next big thing in technology: a headset that will connects the digital world with the real one.

Though Lenovo is still a big player in the smartphone market through its subsidiary Motorola, the PC giant has accelerated its efforts to move into augmented reality (AR) and virtual reality (VR) spaces to gain a competitive edge when the category is developing in the future. As Lenovo’s GM for XR and Metaverse, Shah leads the ThinkReality Solutions team and helps develop XR devices for the enterprise market.

For the world’s largest PC maker by volume and market share, Lenovo’s focus on the company to mainstream consumers with its AR and VR products and solutions may seem misplaced when its competitors, including Meta and Sony, are squarely focused on it focus mainstream users on its devices. For Shah, Lenovo’s targeting of enterprise customers with its XR (extended reality) devices and software solutions is a smart move.

Lenovo’s ThinkReality A3 is a pair of smart AR glasses. (Credit: Anuj Bhatia/Indian Express)

“If I have a machine that’s worth $200 million in output every day, spending $3,000 on a platform that will help me fix it right away is peanuts… the ROI is just there,” Shah explains why ROI, the Use cases and the return on investment are the things that make the XR reality work best in the company’s case for now.

Shah cites that the reason enterprise customers are investing in these AR/VR devices is because they see value in them, even if the headset costs over $1500. The headsets that companies like Lenovo are selling to corporate users not only offer more features, but are also complicated to manufacture. “I believe that XR is one of the few technologies where the company will lead first and actually push prices down for consumers, which was the opposite for smartphones,” he said in an interview with on the sidelines Indian edition of Lenovo Tech World in New Delhi last week.

Lenovo’s lack of interest in releasing consumer virtual or augmented reality devices could be due to the lack of a compelling use case. Companies like Magic Leap, Sony, and Meta promised game-changing headsets, but none succeeded in delivering the immersive experience they initially promised. According to IDC data, global shipments of VR headsets and sales of augmented reality devices fell 12 percent last year.

The reality is that consumer headsets are heavily subsidized by platform owners, with a primary focus on gaming, without consumers having a compelling reason to shell out $500 for one. Shah cites the lack of a “ChatGPT moment” as to why consumer adoption of AR/VR headsets has been low. According to Shah, until headset prices increase drastically and form factors improve, selling a product that mixes the physical and virtual worlds in the hands of many users will be a challenge.

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Based in California, Shah leads Lenovo’s XR and Metaverse businesses. (Credit: Anuj Bhatia/Indian Express)

Shah agrees that the consumer AR/VR market has been “tough,” but he’s hoping for a shift driven by use cases initially tailored for B2B that will later be customized for consumers. “We [Lenovo] don’t have the right ecosystem to work with the consumer market,” he said, adding that the company works with its partners who are strong in the enterprise market, and this is where the applicability of XR devices in healthcare and education begins to make more sense become rooms.

A year ago, Mark Zuckerberg, CEO of Meta, dropped Facebook as his company’s name and shifted the focus to building the Metaverse, a concept where the online, virtual, and real worlds merge into a new universe. He and many in the industry believe the metaverse could herald the beginning of the next frontier in the technology landscape.

“We’ve been victims and beneficiaries to some degree,” Shah said when asked about the hype that has developed around the metaverse, which he describes as the internet’s evolution from 2D to 3D.

“A lot of people have a very dystopian idea of ​​what the metaverse is. We will spend eight to ten hours a day in the metaverse. But I feel like in many ways the Metaverse, especially the Enterprise, is something you use for a 30-minute training session or an hour-long meeting,” Shah said. He added: “I don’t think a walk on the beach can ever be replaced, nor do I believe physical can replace digital or digital can replace physical, but you can always make digital processes more efficient.”

The ThinkReality A3 glasses are optimized for applications such as 3D visualization and augmented reality guided workflows. (Credit: Anuj Bhatia/Indian Express)

For Shah, the biggest impact of the metaverse will be how they train humans, and the jump from 2D to 3D will be huge. “The Metaverse will be heavily influenced by the company,” Shah predicted, adding that it will be more of a B2B oriented game.

While Shah is adamant that AR/VR is the “interface” of the future, smartphones aren’t going away overnight. “I would never write off the smartphone completely, but there will always be more ambient devices.”

Calling smartphones a “sticky” device, he said they will continue to evolve in the future and continue to be a key communication tool. He added that even if surrounding devices, be it smartwatches and smart glasses, got smaller, data processing would still take place on the smartphone. “In the end, if you want to get rid of the smartphone, it’s up to the user,” he said.

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Shah foresees that in the near future the form factor of smartphones will either change or take the form of surrounding devices.

Extended Reality (XR) technology, the term that encompasses augmented, virtual and mixed reality, is expected to transform many industries. As Shah puts it, each technology has a different use case, but he said that at some point in the future, both AR and VR will merge. AR is described as a technology that superimposes computer-generated imagery over real-world views, while virtual reality, or VR, completely immerses the viewer in a computer-generated world. Lenovo’s ThinkReality A3, for example, are smart AR glasses that, when connected to a computer or smartphone, can show up to five different virtual desktops thanks to their high-resolution displays built into the lenses. The glasses cost $1500 and are aimed at the corporate market.

Shah agrees that the current generation AR/VR devices need to get lighter and much easier to use to become mass market products. (Credit: Anuj Bhatia/Indian Express)

But the transition from smartphones to AR/VR headsets may not be easy given the challenges these devices bring, including the high selling price. Shah said AR/VR headsets will follow a path similar to how smartphones came at different price points and were divided into multiple product tiers that were evenly spread across consumer and enterprise categories.

As AR/VR headset hardware continues to improve and decrease in price, the cost of manufacturing the device will eventually decrease. “Technologically, we have matured a lot in the last five years. AR devices have dropped to 130 grams and become very light, while VR devices are becoming extremely compact, made possible by the pancake lenses themselves becoming much thinner.”

However, Shah agrees that the industry is still a long way from reaching the smartphone scale needed to make AR/VR headsets available to as many consumers as possible. “We’re getting there, but not yet,” he said. “To achieve that, optics, battery life, and chipsets that draw low power but deliver long battery life really need to come,” Shah replied when asked about the challenges AR/VR game development is facing. Headsets hamper and eventually slow down the adoption of these devices.

“Managing the supply chain for devices and finding the right optics vendors and vendors who can make those devices is a big challenge,” he added.

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But developing a smartphone and an XR headset requires a different mindset and together different skills and expertise. Not only the hardware, but also the software and services on it are equally important for the device to work as intended. Shah said that as has happened in the case of smartphones, the hardware will be standardized, with each using the same chipset that fits into the headset. For him, however, the biggest difference will be the user interface, which will be the big differentiator when buying a headset. “A lot of people are trying to use VR devices to watch Netflix movies. I think that’s a terrible use case, nobody wants to be stuck in that scenario for three hours,” he said.

Shah believes the interface alongside the ecosystem is where the battle is fought.

Lenovo is betting on Enterprise Metaverse as it will bring more users to AR/VR devices and help create use cases. (Credit: Anuj Bhatia/Indian Express)

Lenovo supports OpenXR, the standard intended to make cross-platform AR and VR apps more common. The idea is to give developers the ability to create a single app that runs on multiple devices, rather than having to create specific versions for each individual version. But where Shah thinks the AR/VR space might differ from the evolution of the smartphone generation is the control the brand, like Lenovo, has over their product. “The reason AR/VR hasn’t scaled is that if a company wants to buy hardware, they either buy software from someone else or do it themselves. They try to bundle everything together and fail,” he argued.

To gain more control over its XR products, Lenovo developed ThinkReality, the company’s AR/VR platform, which Shah describes as an end-to-end solution. It’s enterprise-grade, scalable, and secure. In addition, Lenovo also provides professional services to companies such as Tata Elxsi, Wipro, Accenture and Deloitte to help them with cloud infrastructure and 2D data to 3D data conversion workflow.

Almost 16 years after the release of the first iPhone, the ensuing smartphone revolution transformed the tech industry. But the war between Google and Apple has also stifled innovation and left power in the hands of a few companies.

“If you look at Web 2.0, I think one of the limiting factors is that it just falls into two or three camps and it either sucks out all the innovation or you pretty much rely on it for innovation,” he explained.

Regardless of how much the metaverse was hyped, Shah said the time was right to bring web 2.0 to 3.0. “For the metaverse to be successful, it should be decentralized, open, and interoperable.”