During 2018, I posted many Linkedin articles about VR/AR, AI, IoT and blockchain for smart sustainable cities and STEAM (STEM+Arts) education. https://www.linkedin.com/in/statsuno/detail/recent-activity/posts/
Sheridan Tatsuno, co-founder, OneReality.se, San Francisco
In “Blade Runner” and the upcoming movie “Ready Player One,” Hollywood shows us one of their favorite genres — dark, violent dystopias not unlike many cities today. Dystopias have become so pervasive in movies, books and TV programs that many people are tiring of them and seeking relief in more positive stories and news. Instead of another round of virtual shoot-em-up hells, many VR developers are asking: How can virtual reality (VR) and augmented reality (AR) be used for social good to create virtual utopias? How can we imagine, visualize and design just, fair, carbon-neutral cities? This is not idle speculation since the global population is forecast to reach 9 billion people over the coming century. Real lives are at stake, not just fantasy movies.
Fortunately, the virtual future is quickly coming into focus since many people are working to realize this dream:
- VR Sci Group: This non-profit international collaboration of universities, research centers, game studios and companies recently organized conferences for VR in STEM topics in Stockholm, Cologne, Copenhagen and MIT, where members explored a wide variety of non-gaming use cases and business models. Join in and invite your local colleges and universities to reinvent their cities with locals! http://vrdays.co/people/elena-malakhatka/
- Non-gaming fields: Many Unity and Unreal VR developers are graduating from shoot-em-up games to more serious non-gaming fields, such as healthcare, sustainable cities, logistics, education/training and other mission-critical areas, especially since consumer VR growth is off several years. Unreal is already being used by many non-gaming designers. Unity is reportedly working on IoT for autonomous cars.
- AR First: VR/AR companies are shifting to AR for smartphones to leverage existing 4G networks since fully-immersive consumer VR will require 5G, which won’t arrive until 2020 at earliest. Apple’s AR Kit and Google’s AR Core now make it easier for professionals and amateurs alike to create their own AR worlds and content. Non-gaming teams are hiring domain experts trained as doctors, urban planners and logistics experts who understand the needs, requirements and complexities of their fields.
- Enterprise VR: Most enterprises have access to fast connectivity and can afford $600 VR headsets, so they are already adopting VR and AR. As the co-founder of One Reality, which creates VR models of Smart Sustainable Cities and human cells in the Nordics, I’m often asked how we see the future of virtual cities. Here are my preliminary observations based on our initial projects:
Smart Sustainable Cities: The biggest market for enterprise VR will be developing carbon-neutral cities under the Paris Accord since NASA and international scientists are urging all nations to move quickly to avoid 3C+ global warming. Cities consume 80% of energy and emit 60%-70% of carbon and most of the $8.5 trillion global market in architecture, engineering and construction (AEC) is spent in cities. Today, we have practical, hands-on tools. Planning and designing Smart Sustainable Cities using VR/AR+AI is the new “Holy Grail” since infrastructure decisions will embed energy use for 50 to 100 years. The Nordics are leading the charge, especially Copenhagen, which has a C40 office to train other cities. VR can be used for the entire planning process from visualization, ideation, design, simulations and IoT/AI monitoring. Unreal and Unity has open APIs so VR, AR, IoT, AI and smart cities apps can be integrated into virtual environments. I’ve written several articles about VR/AR+AI+blockchain for urban planning: https://www.linkedin.com/in/statsuno/detail/recent-activity/posts/
Logistics: Managing harbors, airports, transit hubs, warehousing, delivery centers and other logistics centers are major opportunities since VR/AR can dramatically reduce costs and time for planning, designing, visualizing and marketing infrastructure decisions. AR is already being used for warehousing and retailing. Copenhagen Malmo Port (cmp.com) uses VR for marketing its facilities to shipping lines since it is much easier for them to visualize operations; VR will also be used for planning new port facilities, multi-modal transit hubs, housing, retail, parks and other waterfront infrastructure. Integrating IoT, AI and predictive analytics is a hot field among investors since the returns can be lucrative in terms of cost savings and new revenues.
Tourism: Virtual travel promotion using simple 360 videos for smartphones over 4G networks is growing fast. AR is the next coming boom for sharing and marketing. When 5G appears from 2020, immersive VR travel tours will become popular as promotional teasers to attract real-world visitors. VR websites will monetize destinations by adding music and cultural venues, historical tours and events, and shopping by local businesses as well as major retailers.
Corporate Training: Most enterprises don’t fully understand the potential of VR/AR so everyone is learning about the technologies and experimenting. VR/AR development can be outsourced to the growing market of service providers, but the biggest challenges are identifying Use Cases and Business Models, which tend to be very user-specific. For example, public utilities interested in VR/AR for managing their generators and smart grids must choose between a wide variety of potential use cases: system design, building maintenance, staff and contractor training, equipment tracking, disaster planning and recovery, investor relations, corporate meetings, etc.
Retail: Besides travel promotions, the obvious way to monetize VR/AR will be shopping. IKEA and other major retailers are testing a variety of VR/AR services, which will be a major growth field during the coming decades. 2D online shopping is already popular; VR will enable all cities, towns, builders and small businesses to create their own virtual shopping malls since they will not require costly brick-and-mortar investments. Virtual mall templates will become as common as website templates today.
Healthcare: My company, One Reality, is building VR models for human cells for medical education and research, but the real impact of VR will be tele-health and personalized healthcare where doctors and nurses will be able to talk directly with patients in “smart homes” and clinics while viewing VR models of their physical status and ailments. VR is already being developed for mental health issues, such as phobias, PTSD, and depression.
This is a just preliminary list of opportunities in virtual cities, which will blossom as VR and AR gain momentum among cities and builders. Virtual cities will combine all of these VR/AR activities in a wide variety of ways as the technologies mature and developers create useful apps. I welcome your comments and suggestions for my updates.
VR/AR is still in its infancy, as the commercial Internet was in the mid-1990s, so the best way to create our future communities and cities is to imagine them. I’ve written a novel about San Francisco, where the mayor challenges international VR developers to reinvent the City in order to imagine the future. Surprisingly, I recently met two people just like my characters. Often, reality is stranger than fiction…. https://www.amazon.com/Virtually-San-Francisco-Sheridan-Tatsuno/dp/1545488908
Join my VR groups on sustainable cities (https://www.facebook.com/groups/1586659734911313/), medicine (https://www.facebook.com/groups/108287489739653/), and social innovation https://www.facebook.com/groups/socialvrai/
by Sheridan Tatsuno, co-founder, One Reality AB.
Check out my new comedic fantasy VR novel “Virtually San Francisco” on Amazon: https://www.amazon.com/dp/1545488908/ref=cm_sw_r_tw_dp_x_WysBzb200YWR2
How can virtual reality (VR), augmented reality (AR) and mixed reality (MR) be used for education, enterprise, healthcare, government, nonprofits and other mission-critical applications? Recently, there has been a Cambrian explosion of new VR/AR products and applications, but they are mostly entertaining games and movies that feel remotely distant and irrelevant to our everyday lives. How can we make VR useful for the average person?
As a screenwriter and urban planner, I’ve always imagined the future when writing for TV/film and planning cities. Today, my company is working with cities in the Nordics and the SF Bay Area to use VR for planning their transit stops and sustainable communities. Unlike 2D, director-controlled film/TV, VR is a mix of urban planning and theater. Virtual cities are real world, immersive and interactive. They are the “stage” where millions of “plays” happen simultaneously. City officials want us to provide VR/AR mobile solutions to promote citizen engagement. With VR, you can create anything you can imagine, so why limit yourself to typical games or mundane activities that you can see today? Why not imagine something relevant and visionary?
To test my ideas, I wrote a comedic fantasy VR novel, “Virtually San Francisco,” where the mayor challenges VR developers to reinvent the City. Today, real cities are asking my company to do it for real. Fiction becomes reality! My novel explores a variety of themes that can be applied to real cities:
- Biomimetic urban design that incorporates ideas from traditional Ohlone architecture, solar panels, NASA composites and closed-loop recycling, Buckminster Fuller, Zen, hydroponics, and Gaia theories to build a 3D-printed homeless shelter. It focuses a variety of ideas on a serious need.
- Pet therapy by Swedish psychologist studying how dogs can help refugees, the homeless and senior citizens deal with society integration and urban stress, a big issue since one third of Americans have pets.
- Time travel to recreate the 1940s jazz era in the historic Fillmore District where African Americans pioneered the West Coast sound. This is a big issue since tourism is San Francisco’s #1 industry, employing over 70,000. VR tourism and shopping will become major industries over time so it’s worth investigating.
- Virtual fashion design fittings and fashion shows as a way to showcase international fashions, create local jobs, and generate taxes for homeless shelters and city services. The European and New York City fashion industries are already adopting 360 video for their fashion shows; VR fittings and shows are coming.
- An earthquake simulator by an Iranian visiting scientist at UC Berkeley who lost his family in a Teheran quake and wants to stress-test buildings to prevent future disasters. For people living in earthquake-prone regions, this is a life-or-death issue far surpassing Hollywood disaster movies.
- A virtual shopping mall that features virtually unlimited (pun intended) shops, entertainment arcades and venues that do not exist in real life. As with Amazon on the Internet, we will see an explosion of virtual shops in the near future.
The writing was a joy and reminded me of how we brainstorm new buildings, communities and venues in urban planning. Currently, my company is helping Copenhagen Malmo Port (cmp.com), Malmo, Visby, Lund and Stockholm use our VR solution to plan smart sustainable cities of the future — 2070 and beyond — to “future proof” cities under the Paris Accord. The scenes look right out of novels — William Gibson’s “Neuromancer” and Neil Stephenson’s “Snowcrash” — but for real. See: “How Can Cities Implement Climate Change Policies? A Nordic Vision ” https://www.linkedin.com/pulse/how-can-cities-implement-climate-change-policies-nordic-tatsuno
I’m bringing our VR/AR+AI solution to Silicon Valley now so fiction will soon become VR, then mixed reality (MR) as we blend the city with VR.
For my articles on VR for Smart Sustainable Cities: https://www.linkedin.com/in/statsuno/detail/recent-activity/posts/
Sheridan Tatsuno is an urban planner, tech business strategist, and writer who is co-launching his 10th tech startup, One Reality AB (www.onereality.se), which provides VR/AR solutions to design smart sustainable cities as well as medical VR solutions — “Healthy Cities for Healthy People”.
My VR startup, One Reality (www.onereality.se), will staff the booth of Copenhagen Malmo Port (CMP), our first client which is using our VR system to visualize, plan and design its new port in the south, at the upcoming #Malmo #Sustainable #Cities 2016 conference in #Sweden. http://malmo.se/Nice-to-know-about-Malmo/Sustainable-Malmo-/Sustainable-City-Development-2016/Programme.html
Despite newly-elect president Donald Trump’s denial of climate change, Sweden and other countries are moving ahead quickly to dominate the emerging clean tech market, which is being driven by sustainable cities initiatives and investments. Cities consume 80% of energy and emit 60%+ of carbons so we will win or lose the carbon battle in the cities during the next few decades, Trump notwithstanding.
Here are some background articles about the role of cities in the Paris Climate Change Agreement, which was recently signed:
“Cities: The New Battleground of Climate Change” https://www.linkedin.com/pulse/cities-new-battleground-climate-change-sheridan-tatsuno by @statsuno on @LinkedIn
“Mayors Accelerate Sustainable City Plans” https://www.linkedin.com/pulse/mayors-accelerate-sustainable-city-plans-sheridan-tatsuno by @statsuno on @LinkedIn
“Virtual Cities: The Era of 2D/3D Design ” https://www.linkedin.com/pulse/virtual-cities-era-2d3d-design-sheridan-tatsuno by @statsuno on @LinkedIn
“Connected Sustainable Cities & VR UI/UX Design” https://www.linkedin.com/pulse/connected-sustainable-cities-vr-uiux-design-sheridan-tatsuno by @statsuno on @LinkedIn
“Live or Die by Your 3D On-Demand UI/UX” https://www.linkedin.com/pulse/live-die-your-3d-on-demand-uiux-sheridan-tatsuno by @statsuno on @LinkedIn
I realize this is a lot of reading, but I thought it would be useful for the coming debates over climate change, which will be do-or-die decisions that will affect our future on earth. It’s not something to be taken lightly. Indeed, the Native Americans always taught their youth to “think of the seventh generation hence.” What type of world do you want for yourselves and your descendents? What role do you want to play in this grand drama? The choice is yours; I just wanted to provide you with some insights and tools for positive change.
Sheridan Tatsuno, San Francisco
My Virtual Oresund startup, located in the Oresund region (Copenhagen, Malmo, Lund, Helsingborg) will soft launch our VR platform for Sustainable Cities design and planning next month using the Unreal VR engine. People ask me: What are virtual cities? What is a sustainable city? Why use VR to design sustainable cities? What are the opportunities for me as a designer, developer, consultant or marketing person? Where do you see VR headed in the enterprise? How will VR change the way cities are designed? This article is an initial effort to distill my thoughts and organize our VR Sustainable Cities community, which we have launched at: https://www.facebook.com/VR-Sustainable-Cities-1430285733935881/?ref=bookmarks
What is a virtual city? My Swedish team views it as a mixed reality of 2D, VR and AR (augmented reality) worlds where people can build, explore, learn, shop, and interact with others using smartphones, tablets, PCs and the latest VR/AR tools. Our VR platform will enable people to fly through Copenhagen and Malmo virtually, see existing buildings, shops, harbors and parks, and build their businesses, communities and schools, both real-world and virtual. Over time, VR/AR tools will merge so people can create mixed 2D/3D realities. The virtual cities will be extensions of real cities, just as e-commerce extends brick-and-mortar stores, but they will be immersive.
What are Sustainable Cities? A working definition is a city that minimizes energy consumption and carbon emissions by optimizing urban infrastructure systems to reduce reliance on gas-powered systems and increase the use of recycling and electric-powered vehicles and systems. The key metrics would be energy use, carbon emissions, recycling, and electrical use. Overall metrics would include Quality of Life (QoL) indicators, such as educational levels, health, employment, housing affordability, school quality, parks, sense of community, etc. My startup is launching our VR Sustainable Cities platform in the Oresund region because Copenhagen, Malmo and Lund are world leaders in building sustainable cities, so they will be models for other cities. Last fall, India partnered with Sweden to integrate Nordic sustainability into its 100 planned smart cities. http://www.thehindu.com/opinion/columns/indiasweden-tieup-for-smart-urbanisation/article7758010.ece
To measure their effectiveness, sustainable cities will be monitored using Smart Cities technologies, such as sensors, IoT (Internet of Things) devices, smart grids, Big Data and predictive analytics, and other data technologies. Key metrics will be developed for hard infrastructure and QoL. Fortunately, Sustainable Cities and Smart Cities are converging since data analytics will be required to quantify and predict the impacts of Sustainable Cities policies and programs.
Why use VR to design sustainable cities? How will it change how cities are viewed and developed?
Urban Design: Major architecture, engineering and construction (AEC) companies, a $8.5 trillion industry, are already using VR to plan, design, and globally market their projects because it accelerates design and client feedback. Today, it is possible for AEC companies to invite their clients and other stakeholders for VR tours of projects, reducing the need for costly travel. Companies like Sweco (http://www.sweco.se/en/) already provide walk-throughs to clients around the world, saving on travel costs, with VR conferencing. My Swedish team is exploring ways our VR platform can be used for visualizing and planning the new science city near Copenhagen in Lund, where the European Spallation Source (https://europeanspallationsource.se/) and Max IV x-ray accelerator (https://www.maxiv.se/maxiv) will be built. Another project would be visualizing the proposed bullet train, which would create an “8 Million City” stretching from Oslo to Malmo, to educate the public. (http://www.fastcoexist.com/3033176/a-futuristic-megacity-grows-in-scandinavia)
In Silicon Valley, an architecture firm gave me a VR tour of the upcoming Kaiser hospital using my Google Cardboard, which was very impressive since it featured moving avatars. The big opportunity will be involving citizen groups who want to visualize and design their own neighborhoods. Urban design competitions with local schools, universities and community groups would be the best way to give people ownership of the design process. All groups, volunteer or professional, could showcase their designs online so people around the world could view them and add comments, which would revolutionize urban design by making it more open, grassroots and people friendly. It would avoid the pitfall of governments wasting money on “ghost cities”.
Virtual Communications: Like phone calls today, VR phone calls and conferencing will become a major growth industry as 5G bandwidth becomes available because of their convenience and appeal. Think 3D phone calls, mediated by AI, Big Data, predictive analytics and deep learning tools — or VR meets “Minority Report” — which will be gradually adopted by businesses and consumers in all areas of life, creating truly virtual cities. As 4G triggered an explosion of mobile apps, 5G will stimulate a booming economy in VR, AR, and MR (mixed reality) apps for every conceivable business, government, educational, healthcare and consumer use. The apps proliferation will require image and sound search engines, bookmarks, directories, and sharing tools to make it convenient for the average person.
Virtual Travel: 360 videos are proliferating on YouTube and other social media sites, such as the White House 2015 Christmas tour. https://www.youtube.com/watch?v=98U2jdk8OGI Although not true immersive VR, they are building audiences for VR headset makers, which are adding a variety of accessories to make it easier to capture and show travel videos. Education will be a major component of virtual travel because of the need for more in-depth information about places being visited. Remote wilderness locations, historic and cultural sites, artistic venues (like Burning Man, street fairs, and Shakespeare in the park), music and dance performances, and sports competitions mixing real-world and VR/AR imagery will become popular.
Virtual Shopping: Virtual travel and education will be monetized by shopping, as it is now on the Internet. In the Oresund region, we want to enable 1,000 shopkeepers to sell their products virtually by allowing customers to walk into their virtual shops and see items. The difference is that shoppers will be able to walk through virtual malls to see and manipulate products, try fashions on their digital avatars, and see simulations. Besides VR videos of real shops, imaginary shopping malls will become an even bigger business. Think a walk-through 3D Amazon or Alibaba. VirtualEShopping.com is the world’s first such virtual 3D shopping mall: https://www.youtube.com/watch?v=pGRF5QuRG2Y
Virtual Governance: A big advantage of virtual cities is the opportunity to develop truly open governments where all city projects can be displayed, reviewed and commented upon by everyone, not just city officials and insiders who can attend daytime council meetings. In real estate, where corruption is rampant, all development projects could be made transparent using VR to ensure accountability. For many poor developing nations suffering from corruption, the proper VR open governance systems monitored by the public and third-party auditors could dramatically reduce waste and improve the overall quality of life. In the long run, open virtual governance could save nations trillions of dollars a year in money wasted and lost to corruption.
So the potential for VR/AR in designing our cities is enormous. It is still early in the industry growth cycle so we will see rapid technological innovations that could dramatically reinvent the way we design Smart Sustainable Cities, the goal in this post-Paris Climate Change world. These are my opening thoughts so I welcome your comments and suggestions.
Sheridan Tatsuno was trained in urban planning at Harvard’s Graduate School of Design and worked with Bechtel and architecture firms on major energy, transit and housing projects before working in Silicon Valley, where he has advised over 800 tech companies around the world since 1983. He is currently co-launching Virtual Oresund with a team in Malmo, Sweden.
See his related articles on cities:
“Cities: The New Battleground of Climate Change” by @statsuno on @LinkedInhttps://www.linkedin.com/pulse/cities-new-battleground-climate-change-sheridan-tatsuno
“Connected Sustainable Cities & VR UI/UX Design” by @statsuno on @LinkedInhttps://www.linkedin.com/pulse/connected-sustainable-cities-vr-uiux-design-sheridan-tatsuno
“Crowdsourcing Sustainable Cities” by @statsuno on @LinkedInhttps://www.linkedin.com/pulse/crowdsourcing-sustainable-cities-sheridan-tatsuno
“Live or Die by Your 3D On-Demand UI/UX” by @statsuno on @LinkedInhttps://www.linkedin.com/pulse/live-die-your-3d-on-demand-uiux-sheridan-tatsuno
“India 3.0: Sustainable Cities Possible?” by @statsuno on @LinkedInhttps://www.linkedin.com/pulse/india-30-sustainable-cities-possible-sheridan-tatsuno
Can India ever clean up its cities? Recently, I met an Indian woman who recently moved to San Francisco after working in London for a decade and made a disturbing remark: “Many Indian expats don’t want to return home because of the terrible air pollution, which is just getting worse, and I don’t see an end to the problem.”
As a Silicon Valley native who introduced semiconductor companies in the mid-1980s to Bangalore, which had the ambitious goal of becoming “the Silicon Valley of Software”, I am worried that “pollution flight” will deprive India of talented people with international educations and working experience who will be needed to revitalize its massive economy. Like China, the exodus of wealth and brains will hinder India’s transition to the new consumer economy. What can India do to clean up its environment in order to bring back its expats, reduce healthcare costs, and improve its living standards?
Sweden, an environmental pioneer that coined the term “sustainability” in the 1970s, is taking the lead. Recently, India and Sweden signed a Memorandum of Understanding on sustainable urban development, where Sweden will bring its sustainable technologies to India’s 100 smart cities being planned. Mehmet Kaplan, Minister for Housing, Urban Development and Information Technology of Sweden, notes: “We need a holistic approach based on economic, ecological and social sustainability.” In the private sector, Ericsson signed an agreement with Sterlite Technologies to accelerate its focus on smart, sustainable cities in the country. bit.ly/1PflJ2f
Other nations are jumping into India’s sustainable cities market. In October, Ramboll and the Indian-Danish Forum explored how Denmark can bring its sustainable technologies to India’s smart cities. bit.ly/1XPgDLr
In January, the Indian Institute of Technology-Kharagpur signed a deal with Nikken Sekkei Research Institute to plan, design and implement smart technologies to develop sustainable habitats for India’s smart cities. http://toi.in/0MFYoa, http://dnai.in/daXb
In February, India announced the first 20 cities for the smart cities program. As India’s growth accelerates, cities are projected to create an INR 73 trillion ($1.1 trillion) investment opportunity over the next 15 years. Over a dozen Indian states and key cities are incorporating energy conservation into by-laws and mandating the Energy Conservation Building Code (ECBC) in their jurisdictions, which could save enough energy to power to over 350 million Indian homes. on.nrdc.org/1LgGHNG
At the grassroots level, Barefoot College is training “barefoot solar engineers” in the northwestern state of Rajasthan to install solar panels, charging stations, and small LED lights in houses, which would be an invaluable where 240 million people lack electricity. bit.ly/1SVqekA, http://www.barefootcollege.org/
So, to my delight, India is moving faster than I expected to reduce energy waste and carbon emissions. But what about government corruption and foot-dragging?
As I learned from Bangalore, which achieved its goal of building a software industry in the mid-1990s when Internet went commercial, “Where there’s a will, there’s a way.” When I asked the Bangalore tech park manager what challenges he faced in the 1980s, he replied: “Poverty, bureaucracy, corruption, poor infrastructure, nepotism, xenophobia, and no venture funding. Do you think we can still succeed in building a tech hub?” I replied that Bangalore could succeed if all parties worked together and partnered with Silicon Valley. As they say, the rest is history. Bangalore totally surprised us in record time.
This time, India is moving in real time on the cloud, not slowly using faxes as we did in the 1980s. Its 100 smart cities can retain their best and brightest by adopting sustainable technologies and partnering with foreign companies who can help India clean up its cities and develop sustainable technologies for export around the world, just as it has done with software.
My Virtual Oresund startup in Sweden is offering a VR platform that will enable Open Governance and APIs so developers and citizens can integrate Big Data, predictive analytics, Internet of Things (IoT), and other monitoring systems into their VR ecosystems. We look forward to partnering with Indian smart cities developers.
Moreover, young Indians are already “voting with their feet” by moving to cleaner nations and cities. If Indian cities want to keep these talented people, they will have to clean up. My bet is that cities will compete to become cleaner and more pleasant places to live, with the “Dirty Dozen” becoming targets of much media and public derision. In my experience, Indians are too proud to be laughed at, especially by foreigners; they want to become respected leaders in the world. And, like Bangalore, they will clean up their cities and create new industries and companies in the process. I look forward to seeing India 3.0.
Sheridan Tatsuno is co-founder of Virtual Oresund, a virtual reality (VR) platform for Sustainable Cities design and planning, which will be released in late April, initially in Copenhagen and Malmo. For details, join VR Sustainalbe Cities: https://www.facebook.com/VR-Sustainable-Cities-1430285733935881/
Virtual reality (VR) and augmented reality (AR) combined are one of the hottest Next New Things in Silicon Valley — the latest California technology Gold Rush. As Boost VC partner Adam Draper said in June: “We’re in a VR excitement bubble.”
Nearly $500 billion has been invested in VR startups so far in 2015, according to Greenlight VR:http://blog.ingreenlight.com/2015/09/15/the-remarkable-growth-virtual-reality/
Entertainment is driving the market. The biggest launch is Jaunt VR, which has raised over $100 million, including a recent $65 million Series C by Disney and 7 other funds. Jaunt’s new 64-lens VR camera is initially being sold only to big studios and TV networks, which have bigger budgets and can move much faster than game developers, but smaller game studios are jumping in and will probably use GoPro’s upcoming 16-lens VR cameras. http://www.jauntvr.com/65m-funding-announcement
San Francisco is ground zero for the VR/AR startup boom. Rothenburg Ventures, which runs a VR incubator and a new $10 million fund, hosts a bi-weekly VR Art Design Workshop to attract new startups and identify useful consumer apps. http://www.meetup.com/VR-Art-Design-Workshop-SF/?a=wr1_2
The VR landscape is getting crowded as startups scramble to grab market share: https://www.cbinsights.com/blog/virtual-reality-sapphire-vc/
However, investors may have to wait for mainstream adoption in order to recoup their investments. Meanwhile, many VR films and startups will go bust, as during all startup booms. http://www.forbes.com/sites/roberthof/2015/06/11/vc-investments-pour-into-virtual-reality-startups-but-payoff-looks-distant/
How long will this investment bubble last? At least a few more years since the VR/AR market is forecast to reach $150 billion by 2020, which is twice as fast as the Internet e-commerce grew over 5 years in the 1990s. http://www.digi-capital.com/news/2015/04/augmentedvirtual-reality-to-hit-150-billion-disrupting-mobile-by-2020/#.ViKAvxCrSqk
Why? Unlike VR during the 1990s, which was dominated by big, expensive, clunky headsets, this generation features affordable headsets, including $10 Google Cardboard holders for smartphones and $99 Samsung Gear headsets for consumers. Google has given away 1 million Cardboards, with another 4 million sold. For enterprise and high-end gamers, Oculus Rift headset will reportedly sell for $1,500 early next year. The VR market will be primed with plenty of users, but little content, so the battle for VR apps has begun.
When will VR/AR come of age? It’s still early, but there’s a lot of corporate and VC activity buzzing around this fledgling industry. At Augmented World 2015 in June, most of the VR exhibits looked fresh out of the lab and in search of useful applications. Google Cardboard looks amateurish, while higher-end VR headsets are heavy, clunky, expensive and very technical. Applications are mostly automotive, industrial and high-end gaming, not something for the average business person or consumer, at least not yet. The Oculus headset has attracted lots of attention, but it’s still for high-end gamers.
On the other hand, I recently met a wearable display developer who has created small attachable LC projectors for any pair of eyeglasses. You just attach them to a magnet clip-on. The screen displays a 2D LC screen, but he said it could be improved for panoramic video and eventually AR and VR. Battery life is a problem, but easily solved by swapping out for another set from a charging box. Simple and elegant, with lots of potential, just like GoPro in the early years.
So what will drive VR and AR adoption in volume? Here are my bets:
Architecture, Construction & Engineering (ACE) companies are already using VR to visualize, design, and market their capabilities to clients around the world. I’ve seen several demos, but they’re usually private showings reserved for prospects, partners and clients. ACE is a $7.8 trillion global market and VR/AR would reduce design and travel costs immensely so it’s a natural early market.
Body visualization that allow students, nurses and doctors learn about human organs, limbs and diseases would be a boon to public health education and medical training. When combined with wearable tech, it would reinvent the way we learn and care for our bodies. Telemedicine would enable people in remote towns and developing nations to access quality medical services. One of my Swedish startups offers VR surgery to reduce miscommunications, which cause 70% of mistakes in the operating rooms.
Simple AR games using cheap glasses with clip-on projectors and Bluetooth to smartphones. They would allow gamers to view and even download AR apps. Building block and sim games, treasure hunts, visual quizzes, and other leisure games would be easy to create.
Sports viewing will be a big business since advertisers would be able to offer games, stats, contests, prizes, discounts and other goodies to support local sports clubs and school teams.
Home visualization that would allow homeowners, architects and interior designers to add rooms, textures, extensions, and other features would make it easy to redesign homes and neighborhoods. It would tap into the natural curiosity and desire to visualize and build things without spending any money. Some realtors are already using 360 video to sell properties.
Role-Playing to teach social etiquette, business practices, intercultural relations, professional roles, and other important social skills will become increasingly important in a service economy where people are becoming isolated by smartphones.
These are just some of the VR/AR applications that appear to have some traction among early users. Once Oculus and other VR headsets decline in price, we’ll see an explosion of mobile apps that tap the power of VR/AR processing. Here’s a BBC video about the future of VR to get your creative juices flowing: http://www.bbc.com/news/technology-33155037
In Sweden, my startup team is promoting VR Sustainable Cities among policymakers, design companies, and sports clubs. Join us and share your ideas! https://www.facebook.com/VR-Sustainable-Cities-1430285733935881/
by Sheridan Tatsuno, Dreamscape Global, San Francisco, CA
How do you launch a successful global media company? Where are the opportunities, challenges and pitfalls?
As a screenwriter and a Silicon Valley tech strategist and serial entrepreneur co-launching my 8th and 9th startups, I believe we’re at the cusp of a revolution in digital media and entertainment – Hollywood 2.0 – which will overturn existing industries as digital news and music have done in the past.
With the explosion of mobile media, crowdfunding and digital currencies, “blue ocean” opportunities are limitless around the world. Like Internet 1.0, entrepreneurs are likely to be the leaders in creating new business models and industries. But the mobile cloud boom will be much, much bigger. There were only 100 million PC users when the Internet went commercial in 1994; now there are 6+ billion mobile users worldwide.
HOT MARKET OPPORTUNITIES
Where are these opportunities and how can you capitalize on them? The fastest-growing media opportunities today lie in mobile video and gaming, community clouds, personalized e-commerce, and Asia. Mobile video is forecast to reach $2.5 billion in 2016, up sharply from $1 billion in 2013, with Asia becoming the largest market. (http://bit.ly/1vZAR8T).
Facebook and Pinterest are expanding their mobile video capabilities so look for ways to integrate mobile advertising with them, especially Pinterest, which is product-driven. Flash sales and auctions on Instagram, Snapchat and other mobile platforms are potential new markets.
The entertainment gaming market is saturated so some gamers are shifting to business, education, nonprofits, and government since these organizations need to attract and retain Millennials who prefer enjoyable ways to collaborate real time via mobile devices. Bunchball and Badgeville are leaders in gamifying marketing and sales. In Sweden, my friend developed a mobile game where hospital employees reduced energy costs by 30%.
Corporate training is ripe for reinvention since it is a $50 billion market that is broken and ineffective. My startup, TruNorth Global, is focused on this space. Within a few years, most companies will recruit, train, motivate and collaborate using a variety of real-time mobile training and Big Data tools and systems. The early applications will be sales and marketing, legal and financial compliance, financial trading, HR training, and other areas where competition, regulations and costs are critical factors.
Public education is being reinvented by Khan Academy, Coursera and other e-learning startups, but they still use traditional video lecture approaches. New startups are creating interactive training that involves challenges, contests, and other gaming approaches.
English language training is popular, but multilingual platforms will be key for selling to Asia, Europe and cities with diverse populations.
Cisco has found that community clouds among universities are becoming popular ways to reduce costs and share resources.
EMERGING BUSINESS MODELS
The era of “build it and they will come” is over. Today, discovery is the biggest challenge facing all gaming, video and fashion companies since app stores and the Internet are saturated with competitors. How does one build a strong fan base and community?
Creating compelling videos on YouTube and Tumblr to a loyal fan base has moved beyond periodic ads to news channels. Crowdfunding using social media is a way to test the viability of new products, but tends to favor hardware products and media celebrities. If you don’t have a celebrity, how do you attract attention and build traffic?
Today, you need to build an interactive and iterative process where you are constantly in touch with your customers and fans, from sample content and MVPs (Minimum Viable Products), through crowdfunding, full production, marketing and distribution. Ask customers what they want and how they want it and offer contests and challenges.
For early startups, building on AWS, IBM, and other cloud services is cheaper and faster. There are dozens of CRM (customer relationship management) and social marketing services that you can use to engage and track your fan base. See these vendor sites for Use Cases on how their media customers are using their services and study their success stories. Many platforms offer startup services and incubators so shop around for the best deal.
Once you build a core audience, post your startup on AngelList.org and local angel groups. Look for accelerators in your area that can connect you with investors.
Silicon Valley investors and media giants are currently seeking to invest in and acquire media platforms with market traction, so think through your value proposition to them and your “exit strategy” since investors seek a return within 5 to 7 years.
In San Francisco, my partners have launched RFS 9 Hollywood 2.0, an informal group to invite developers who can build media startups, which can be pitched to our network of a few thousand Silicon Valley angel investors, so tell your developer friends: https://www.facebook.com/groups/296515880538125/
STEPS YOU CAN TAKE NOW
Most media creators I meet are “starving artists” because they only focus on creative production and forget the business side. It’s called “showbiz” for a reason, so focus on finding a savvy business partner. George Lucas was able to build Star Wars into a sustainable global franchise because he mastered the business aspects of the film industry.
Here are some immediate steps to take:
- Learn as much as possible about business (finance, accounting, marketing, sales, distribution, partnering, negotiations, etc.) through online sources, e-learning, books, classes, workshops, events, business clubs, and friends. Your business experience should be a lifelong process since markets are constantly changing.
- Study and interview successful gamers and filmmakers to learn how they succeeded, especially in the critical first years. Post your learning and discuss them with your team, fans and partners to find ideas that are applicable to your business.
- Establish your own media club on Facebook, Linkedin, Twitter and/or other social media services in order to build your community of partners, fans and volunteers and share games and videos online, not just promote your company site. Media is a collaborative effort so you need to build a loyal fan base like Star Wars or Minecraft by starting small and building over time. In 2010, I launched Silicon Valley Global Network to connect entrepreneurs around the world; it now has 28,000 members and is growing organically. SVGN has opened many doors to new business ideas, partners, and opportunities. Building it has only taken a few minutes a day; it could be monetized as an entrepreneurship channel. https://www.facebook.com/groups/109971182359978/
- Find a seasoned business partner who can manage these issues full time, so you can spend most of your time creating. The best referrals will come from friends and people in media companies, business clubs, incubators, and alumni groups
- Work with local business groups, chambers of commerce, universities, tech hubs to build a critical mass. In the mid-1980s, I volunteered with SIPA.org to introduce Silicon Valley chipmakers to Bangalore, which had the ambitious goal of becoming “the Silicon Valley of Software.” I thought it would take 20 years, but they shocked us all by taking off in 10 years. So aim high, start small, collaborate and work hard!
In Silicon Valley, we’ve learned that nobody can predict the future, so we focus on building software and hardware products, moving fast, learning from mistakes and failures, and constantly iterating. There’s no easy way to the top, but as former Apple and Disney designer Alan Kay said: “The best way to predict the future is to invent it.” So invent your own future with your business partners and fans! Then you’ll have something valuable to share with the world.
Silicon Valley Global Network: https://www.facebook.com/groups/109971182359978/
“Silicon Valley is a state of mind, not just a place.” This idea has often been quoted, but it only touches the tip of the iceberg. Silicon Valley is not just a state of mind; it is a spirit of sharing and “paying forward” to new entrepreneurs and society. It’s about giving and celebrating together, not just taking from others.
In their rush to copy Silicon Valley, many regions around the world try to clone the valley’s institutions and best practices — our state of mind — but they fail to understand our original small-town spirit of sharing and collaboration. It is this sharing of risks, glories and failures that separates us from the most of the world, which usually punishes risk-taking, sharing and failure and shuns “losers.” Our “Operating Spirit” (OS) is our “secret sauce” that give us a huge advantage over other regions who think it’s only about institutions and funding. We believe in giving people second, third, fourth and more chances — serial entrepreneurship — since we know that most startups fail.
When I was a child, Silicon Valley was mostly farmland, with San Jose a small town of 100,000 people. Our parents were farmers, shopkeepers and factory workers. Computers and chips did not exist; we created things with our hands and shared our results. Only when NASA launched the Apollo Project and the Pentagon the Vietnam War did the valley boom and attract engineers, which I wrote about in my e-book, “In the Valley of Digital Dreams” (available at Amazon and Barnes & Noble). When NASA reached the moon in 1969, it laid off nearly all of its engineers so tech unemployment soared to nearly 35%. It was an economic disaster, but the valley was such a pleasant place to live that engineers stayed put, shared ideas, built stuff in their garages, and joined emerging chip startups like Intel, AMD and National Semiconductor. In the face of massive layoffs, we remembered to hang together and help each other out. That was the original spirit of Silicon Valley that I remember so well.
Silicon Valley has gone through numerous booms and busts, each time bigger, faster and more global than the previous one. Today, we face ethical breakdowns because of an obsession with money like Wall Street. But the current VR/AR, AI and blockchain boom is no different, just bigger and faster. Each time, the dedicated valley residents ride out the downturn, cutting their expenses and searching for the Next New Thing, then inventing it with friends. They don’t want to miss out on the rocket ride when it comes. It usually comes much faster than expected due to our collective efforts, creating thousands of startups and toppling giant corporations.
What is Silicon Valley’s “secret sauce”? Sharing.
Our sharing culture reveals itself in several ways:
– We love brainstorming and sharing ideas with friends and colleagues anywhere, anytime, at dinners, cafes, parties, weddings, picnics, or family gatherings.
– We love building new stuff together, sharing suggestions and feedback, and seeing whether it will “stick” (gain market traction). If it fails, we try again until we figure it out. Failure is only for quitters.
– We build sharing services around office space, cars, rental apartments, anything thing that moves or can be occupied, since the Bay Area is very crowded so sharing is more economically efficient and rational.
– We love sharing contacts, introductions, tips and suggestions to colleagues and newcomers, knowing they will reciprocate with their own new ideas and technologies.
– We share the fruits of our successes as well as lament our losses together. I’ve co-launched eight tech startups; six failed but one went public last year — Audience Inc. — so I know the highs and lows of the emotional roller coaster very well. The latest — OneReality.se, a VR startup — is gaining market traction in the Nordics and Silicon Valley.
– We compete fiercely, but we know that winners will pull up all of us since technology is not a zero-sum game, but an exponential growth industry where success attracts investors and leads to more success.
– Most importantly, we share our time, knowledge, enthusiasm, energy and help with others, knowing that good karma comes back manyfold to all of us and that WE is much more powerful than ME. That’s what makes Silicon Valley so successful and inspiring. We share to create something bigger and better than our own companies and lives. We are building a global community.
So when people ask me “How can we create a Silicon Valley?”, I advise them to study our heart and actions, not just our technologies and institutions. Then they will discover the real Silicon Valley and the reasons behind our successes. The secret lies in the heart, not just the mind and the pocketbook.
One Reality’s VR demos: https://www.facebook.com/groups/263449064157532/
San Jose Metro interview with me: http://bit.ly/J4aoPs
To buy “In the Valley of Digital Dreams” e-book: http://bit.ly/RYn4yi
By Sheridan Tatsuno, Executive VP, TruNorth Global; Partner, DFM Ventures
The U.S. is probably the most competitive market in the world because of its openness and rapid innovation. Offering great products and services is not enough, even for U.S. companies. For newcomers, the challenges of language, regional and cultural diversity, and state and local regulations can be bewildering. What is the best way to start growing your business in the U.S.? What are the pitfalls?
Build Local/Sell Global. For young companies, I recommend developing your products and services initially at home to maintain R&D control, minimize costs, and get user feedback. Keep your engineering team at home since U.S. costs can be very high. In late 2010, Rovio’s Chief Marketing Officer Peter Vesterbacka said Rovio did all engineering in Finland since Silicon Valley salaries were about three times higher, about $180,000 vs. $60,000 for a comparable engineer. Rovio had a hard time competing with Google, Apple and Facebook in attracting top Silicon Valley engineers since they have a wide choice of higher-paying jobs. By contrast, Finnish engineers are more loyal, especially due to the massive Nokia layoffs.
To minimize costs, do your engineering initially at home and hire sales and marketing managers in the U.S. Listen carefully to your U.S. marketing/sales team and avoid “remote control management” where your headquarters makes all the final decisions. A San Jose State University professor found a 85% failure rate among foreign companies deciding marketing/sales from home. Financial and legal issues can be handled by local firms. In terms of finance, legal issues and marketing/sales, “do as the Romans do.”
In 1994, I advised Nokia’s digital phone launch team, which consisted of about 50 young people between 21 and 27 years of age, on the consulting team of Strategos, headed by London School of Business Professor Gary Hamel. They had little or no experience marketing overseas, so I advised them to hire the top marketing managers in each target market, train them in Nokia’s technologies, then do what they suggested. Nokia was doubtful about their chances for success since no Finnish electronics company had ever succeeded abroad. But they listened to their offshore marketing managers and become #1 in 3.5 years, beating Motorola, which sent shock waves through Silicon Valley. So it is possible for newcomers to dominate global markets in several years with the right products and brilliant marketing and sales.
Rovio is the latest example. Peter Vesterbacka said Rovio thinks big and global. They want to become the next Disney, so they’re building the Angry Birds franchise into movies, webisodes, theme parks, etc., like Disney did. Recently, they launched a Star Wars version with Lucas Entertainment.
Minimum Viable Company – What is the minimum you need to get started? Initially, you can set up operations by traveling to the U.S. for up to 90 days to find an attorney, accountant, and a marketing/sales representative or manager. Your marketing/sales rep can work from home. If you want local visibility, you can rent a desk at one of the many incubators or accelerators, which charge around $300 to $400 a month for a desk and access to WiFi, conference rooms, and events. Local startups can suggest the best deals. Don’t waste your money on trying to look impressive. Save your money for airfare and showing your product at the many local events. Make sure to collect business cards and always follow up immediately to build your visibility and brand. Think lean!
Professional Service Costs – Legal and financial advisers can be very expensive, especially for large firms that charge up to $500 or more per hour. To minimize your costs, ask local entrepreneurs and professional associations who can recommend small firms or individual professionals, which can cost half as much.
Marketing/Sales Expenses – These costs are variable since everything is negotiable. Although you can find marketing/sales reps willing to work for commission-only (success) fees, it’s easier to find a rep if you pay a retainer of $2,000 to $3,000 a month, plus sales commissions. For startups, you can offer stock options, typically 1% to 10%, which can be “vested” (given) to the rep over four or five years. Determining sales incentive programs is probably the most challenging since there is so many options mixing base salary, sales commissions and stock options. Get advice from other entrepreneurs to get a feel for the incentive rates. If you hire someone, there are plenty of HR (human resource) firms that can quote you current salary rates.
Even for U.S. companies, finding and keeping great marketing/sales people is very difficult but U.S. professionals will work initially for less money if you have a great product/service and they have much freedom and autonomy to set marketing/sales strategies.
Important Qualities for U.S. Success – Listening carefully to local marketing/sales managers like Nokia initially did and acting boldly like Rovio are critical since U.S. companies are much louder, bolder, aggressive and fast. Think of the U.S. like the Olympic Games; only the top teams win. To survive, let alone thrive, you must listen, be bold and constantly innovate. Avoid becoming smug like Nokia. Complacency kills!
Podio of Denmark is the latest success. I met its CEO a year ago when he searched for angel funding, but I told him it would be difficult to raise if he had no local presence and team. He marketed himself actively and was recently acquired by Cytrix in less than half a year. Not all startups can get acquired that fast, but if you have great products, you can always find buyers in the U.S. since we have so many M&A (mergers and acquisitions) firms and aggressive companies seeking hot technologies.
Going public is much more difficult, even for U.S. companies, so plan on generating sales fast and building incrementally. Your goal should be to build a solid company, not just seek M&A or IPO. Most U.S. companies remain private to maintain control.
Solid Business Model – The biggest error that foreign entrepreneurs make is to focus exclusively on their products and services, not business models. U.S. investors want proven business models that have been validated by customers, either three or four enterprises or several hundred thousand consumers. Without market traction or validation, it’s very hard to raise angel or VC funding. So focus on finding customers first!
Initial Startup Costs — To get started in the U.S. market, allocate at least $20,000 for air travel (2 trips), lodging (couchsurfing with friends is best to save money), event fees, and marketing/sales retainer salaries for six months. Your goal should be to find corporate clients or generate consumer sales as fast as possible to validate your business model. Ask startups about their costs; many entrepreneurs are fairly open since they want to learn best practices from other startups.
If you’re not getting customers within two months, immediately revise your product plans and tailor your product or service based on customer feedback. Don’t waste time trying to raise angel money until you get positive feedback. Basically, think like a “lean” company: move fast and keep your costs as low as possible. For ideas, ask startups from your city who are expanding into the U.S. how they’re doing.
Entering the U.S. market is only for bold entrepreneurs and companies who are willing to work hard, minimize their costs, and work closely with their customers. You can succeed if you constantly revise your product or service until you get positive feedback, then start building since investors will become very interested.