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Google Sees AR, Not VR, as the Real Goal

At its developer conference in May, Google is expected to talk a lot about its plans for tailoring Android smartphones to virtual reality. But make no mistake: for Google, VR isn’t the ultimate prize—augmented reality is.

Google leaders including CEO Sundar Pichai and Clay Bavor, who heads a newly formed VR unit at Google, have privately said that augmented, or “mixed,” reality, in which digital information and images are overlaid or next to a person’s view of the real world, is going to be a much bigger market than VR in the long run, according to several people at the company and elsewhere. (Think “Terminator” vision.)

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In a recent conference, Unity’s Mr. Riccitiello said he believed more than a billion people will use head-mounted displays or glasses for VR or AR in five to 10 years. But the growth will follow a hockey-stick type curve that will take a few years to get going (for now, devices will be expensive “erector sets” for a relatively small number of people) and will lag analysts’ expectations for a long time, before exceeding them. 

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Google has been working on...a “third eye” that can scan the environment and push images to Google’s cloud-based systems for analysis.