It was interesting to see the discussion around Snap Inc.’s announcement of Spectacles V.2 last week.
As had been speculated by various reports in recent months, the company has launched a new version of the camera-enabled sunglasses, with improved tools and features which aim to make the device a bigger part of the company’s future.
But hang on a minute – weren’t Spectacles considered to be a massive failure, and a weight that hung around Snap’s early earnings results?
Last November, reports showed that Snap lost almost $40 million on unsold Spectacles, with hundreds of thousands of pairs sitting in warehouses. TechCrunch published an article titled “Why Snapchat Spectacles Failed” – even Snap noted that the product wouldn’t “annualize”, which most took as a corporate-speak softening of “failed”.
So why then is Snap persisting with them? Why build another version, and continue investing in a product which has already been deemed a failure?
As we’ve noted in our reports on Spectacles previously, there’s likely more to the smart glasses than it seems.
Computer Vision
While the functionality of Spectacles has, thus far, been limited to recording video and taking photos, that’s clearly not the end game.
In a patent filed last May, Snap Inc. included details about how their AR-enabled Spectacles would work, with display sensors built into the glasses which could overlay digital images on your real-world view.
As noted in the patent details:
“[An] AR image may be generated using image-based tracking to locate and set a correct image sensor location and pose within the AR and matching real-world environment.”
In fact, Snap’s been working on such functionality, and its related applications, since 2015 – in another patent, the company detailed how location-based AR would work, with digital images that would shift in perspective relative to your location when viewing them.
“For example, if you were to take a photo on the north side of the Empire State Building, the system would identify the angle of the building and give you the opportunity to attach an image of King Kong looking at you, or his back on the opposite side.”
A fully AR-enabled version of Spectacles would obviously enhance this, and while we haven’t actually seen that next level device as yet, this is clearly where Snap is headed.
But so what? You can talk about next level technology all you want – flying cars are great in theory, but you can’t make real money until you can actually get them to work.
The new version of Spectacles don’t offer AR, and the first version failed. So why does this new type matter?
How does this help Snap even move towards that next stage?
Evolving Perspective
By all accounts, no one is close to offering fully functional, AR-enabled glasses that can be worn around – at least not without a Magic Leap style backpack set-up.
Not exactly conducive to day-to-day use.
Facebook, which is also investing heavily in AR as it looks to its next evolution, says that we’re still five to seven years away from being able to build the AR-enabled glasses people want, and given The Social Network’s resources and capacity, you’d have to think they’re closer than the far smaller Snap Inc. to reaching such a breakthrough.
But maybe they’re not. Maybe, through their own, secretive development, Snap is actually advancing faster to that next stage.
You’ll recall that when Snap first launched Spectacles, they also announced their new ‘camera company’ tag line.
That could suggest that the company is serious about shifting its focus to devices, and away from the Snapchat platform itself, and the company does have a research facility in China, near where Spectacles are developed – and away from the prying eyes of western media.
While the new Spectacles don’t offer AR overlay as yet, they do give Snap a chance to refine kinks in their production process, to build demand for a more fashionable version of smart glasses, and to further align their business with the distribution of hardware, as opposed to apps. That last point is particularly significant – while Facebook has dipped a toe into hardware production, it’s yet to produce a large scale consumer product, and it’ll likely take them some time to develop and perfect the direct-to-consumer element.
Snap is already far closer on this front, and getting more advanced every day. It may seem like a minor detail, a triviality within the larger process. But shifting to hardware is a significant move, and it does take time to perfect.
Snap will already have this element down pat by the time they can offer AR overlay tools, and they may even be able to provide updates to current versions of Spectacles which facilitate this.
Essentially, what we’re looking at with Spectacles is the next iteration of an advanced business model, not just the sale of cool-looking, camera-enabled sunglasses. And such moves could prove crucial to Snap’s future – before consumer interest in Google Glass tailed off, AR-enabled glasses were projected to become an $11 billion market.
Snap’s 2018 ad revenue projection? Around $1.18 billion. The focus makes a lot of sense.
So while the new version of Snap’s Spectacles may not be amazing, may not have world-changing new features, they are better than the first version, and will likely help the company build interest. And that could prove crucial in the long run – far from being a failure, Snap’s evolving Spectacles could become the thing that takes the company to the next level.