There are many problems that VR/AR has yet to solve. One of these is how we, the users, are going to command and interface with these new virtual environments. Keyboards are impractical, haptic gear is too unwieldy and text-to-speech is indiscreet and unsuited for many uses (‘Close all windows except the window that I’m looking at right now and resize that window to fill the entire field of vision’). The holy grail of VR/AR interfaces? Mind reading.
Facebook is investigating how to tap into mind reading as a “new means for input to AR”. One use case they’ve proposed is the “brain click” – “you could brain click to dismiss a notification that popped up on your AR glasses, for example.“
It’s not far-fetched to consider that, in the near future, Facebook will develop technology that’s capable of basic instructional interpretations (the VR/AR equivalent of moving a mouse, clicking), reading basic emotions (sadness, excitement, etc.), and typing.
The temptation for Facebook:
Once Facebook develops MindReader™ (let’s call it that for now), they will be tempted to keep the technology proprietary. This vertical integration fits in with their other moves in VR/AR so far including acquiring their own hardware (Oculus) and developing their own virtual worlds (Facebook Spaces). In such a scenario, the technology will be treated like a feature. Value creation will come from making Facebook’s VR/AR software more user-friendly and featureful; value capture from revenue streams (probably ads) on Facebook’s software, and selling Facebook’s hardware.
Though there’s nothing inherently wrong with this approach, it’s predicated on Facebook’s proprietary ecosystem winning the VR/AR wars. This is anything but certain. VR/AR is anyone’s game both in terms of hardware and software. Moreover, Facebook’s operating model doesn’t currently have strong capabilities in creating awesome digital environments or developing hardware.
What Facebook’s should do:
Rather than keep the technology for proprietary use, Facebook has a greater chance of making MindReader™ a success if they allow it to be freely available. Specifically, they should:
- Partner with as many manufacturers as possible to incorporate the hardware technology
- Release an SDK for VR/AR developers to utilise in exchange for control over data
- Link users’ MindReader™ activity to their Facebook accounts (almost akin to social login)
This strategy allows Facebook to:
Align themselves with whoever wins in VR/AR – when it’s unclear who the winners will be, a parallel search strategy is the way to go. And when there’s heterogeneity in what consumers want from VR/AR, it makes sense to align yourself with a variety of applications/hardware. By making MindReader™ available for public use, Facebook will ensure that they get access to a bit of everything, including, the eventual winners in the ecosystem.
Utilise data analytics to improve value creation – getting broad access to data will allow Facebook to provide phenomenal value-creating analytic services. There could be significant improvements in the sophistication of targeted advertising (e.g., measuring emotional responses to stimuli). Facebook could also offer developers tools such as rapid AB testing (e.g., change the environment: see immediate responses).
Leverage network effects to sustain a competitive edge – a large base of users and use cases also allows Facebook to tap into direct network effects to improve MindReader’s™ performance. This improved performance can lead to strong indirect network effects. Moreover, MindReader™ could track user’s preferences and neural ‘calibrations’. As a result, the more users on Facebook’s MindReader™, the more likely developers are to utilise it. Given low incentives for any party to multihome (why would you if the technology works?), these network effects could be critical to Facebook winning what will likely be a winner-take-all market.
Capturing value in this world could come from selling advertisers and developers information on users and their preferences. Moreover, Facebook could run a Google AdSense-esque offering, charging advertisers and developers for generating personalised experiences/advertisements in their AR/VR environments.
Facebook already has many of the business model elements required to pull off such a strategy. Strong analytical capabilities? Check. Processes for managing the ad buy-sell process? Check. A huge data bank on users? Check and soon-to-be even more so. The one capability that Facebook will definitely need to put more effort into is that of developing users’ trust. It’s a brave new world out there. Would you trust Facebook with reading your mind?