Extended Reality, call it augmented reality/virtual reality/mixed reality technologies, has been the “next big thing” for almost a decade. The new normal in the aftermath of the pandemic has accelerated its journey, so could a retail e-commerce boom, the birth of the metaverse, and the continued interest in social and interactive gaming nudge it from this limbo state? There may be some light at the end of the tunnel, possibly marking the entry into a new reality, finally!

Large disruptors such as Magic Leap, Niantic, Matterport, and MindMaze have combined to raise more than USD 1.2 billion over July to November this year. The renewed interest is so sizable that Blippar, an AR creation and publishing platform, was resurrected from near bankruptcy as investors took a flier on it with a USD 5 million pre-seed round earlier this year. Moreover, incumbents such as Facebook and Microsoft have been active with a focus on the enterprise segment through the launch of VR platforms for remote work.

The regulatory environment for Extended Reality is relatively stable now as the federal and state laws on data privacy regulate data collection for development. Among the many reasons (such as expensive hardware and IP issues) holding back the industry, a strict stance and specific data laws posed onto this industry could impact its core functionalities (e.g. eye and motion tracking) negatively, and potentially curb its growth before it begins. In this introductory article to the Extended Reality industry, we take a closer look at the concept, components, use cases (beyond gaming), the current startup landscape, and different business models.