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Pokemon Go craze: A harbinger of the augmented enterprise?

Pokemon Go is pushing augmented reality closer to enterprise adoption. Also on Searchlight, Microsoft wins in warrant case; Google hit with new charges.

It has more daily users than Twitter. It's been downloaded more times on Android smartphones than the dating app...

Tinder. Pokemon Go is the free smartphone game that uses the device's camera, GPS, graphics processing and position sensors to display digital pocket monsters on users' screens so the creatures appear as though they're really perched on a park bench or buzzing overhead. It is already the biggest mobile game ever released in the U.S. And it's a sign of things to come.

I'm currently an anomaly in my social circIe of otherwise-mature 20-somethings. I haven't yet downloaded the mobile app that has most of them flocking to the nearest church or street corner to catch Pokemons -- or what they refer to as Poke Stops and Pokemon gyms. But this much I know: Very soon, this kind of smart device augmented reality (AR) will become commonplace in business.

Pokemon hype and business adoption

Actually, enterprises were already heading down the path to augmented reality pre-Pokemon Go. Startups Atheer Inc. and Osterhout Design Group are selling AR headsets aimed at healthcare and engineering firms, and Microsoft is collaborating on AR and virtual reality projects with a handful of companies in industries that range from automobile to architecture to home repair. But adoption of augmented reality has been slow, mainly because its uses thus far have been so industry-specific, said Tuong Nguyen, principal research analyst at Gartner, and has required special gear.

"It's not ready for general-purpose," he said, but added that the Pokemon Go frenzy could rev things up. "More people know about it, more people are getting excited about it." That should spur adoption and competition in the enterprise space, he said. Indeed, Microsoft CEO Satya Nadella told CNBC the app could spell "a lot of interest in HoloLens," referring to the virtual reality headset that lets users experience 3D holographic images as if they were a part of their physical environment.

Hyoun Park, chief research officer at Blue Hill Research in Boston, said he expects the Pokemon Go phenomenon to change how companies develop apps, serve their customers and help their workers get work done, citing two aspects of the game that could prove valuable for businesses: contextualized feedback and the combination of digital and physical objects into a single view in your smartphone.

"As we start seeing our smartphone as a lens to augment whatever we are looking at, companies will start seeing the value of providing some sort of chip, code or context-enabled digital augmentation to their products," he said.

For example, companies could use augmentation to walk their customers through how to fix complex products, authenticate whether a product is real or counterfeit for customers, or work with other brands to provide a layered customer experience, Park said. This potential is "the true transformation that will change the enterprise," he added.

One roadblock to AR adoption is the learning curve. But something like Pokemon Go narrows that gap, Park said, much as the iPhone did for touchscreen technology. "Pokemon Go is going to teach a significant audience how to use augmented reality both for fun and for work."

What about privacy?

The new technology is not without its dark side.

"The Pokemon Go craze is a tale of two cities; it shines a light on how cool augmented reality can be. It casts an even darker shadow on the issues of personal and workplace privacy and security," said Bob Egan, chief research officer at Seraphim Group LLC in Falmouth, Mass.

The fine print of Pokemon Go's privacy policy, which details what the app and its maker, Niantic, can do with the broad swath of data it collects from its users, including profile data, device identifiers and location data, should raise alarm bells, he said. One of the things Niantic can do is share this data with government or law enforcement officials, as well as third parties, he said. This week, Sen. Al Franken (D-Minn.) wrote to the developer of the game, expressing concern over the game's "unnecessary" data collection without users' knowledge.

Adrian Sanabria, senior security analyst at 451 Research, puts a lot of the onus for transparency on developers to spell out what data they collect, how they store it and what they do with it.

"It shouldn't take a security researcher to do this -- I should be able to answer [these questions] by looking at the details of the app on my phone," he said.

But users have to learn to do their part, too, he said, though he's not optimistic that will happen anytime soon.

"The attraction of new technology will win every time over proper due diligence. Whether it is 2008 and iPhones are invading the enterprise, or 2018 and Microsoft's HoloLens, this stuff will show up before we fully know the impact on privacy," Sanabria said.

Meantime, he suggested companies making money off augmented reality apps, or developing them for their employees, need to start thinking about how they will handle data privacy issues. Europe's General Data Protection Regulation, for instance, increases the responsibilities of companies handling personal data in any way, giving consumers stronger powers over their data, and imposes greater restrictions on data flow across international borders.

"Legislation like GDPR ... can help put this knowledge into consumers' and enterprises' hands," Sanabria said.

CIO news roundup for week of July 11

Besides the Pokemon Go sensation, here's what else made headlines:

  • Big win for Microsoft. A three-judge panel of the U.S. Court of Appeals for the Second Circuit in New York ruled in favor of the cloud giant on Thursday, in a case that dates back to December 2013 and overturns a ruling by a lower court in August 2014. Microsoft had challenged a search warrant issued by the U.S. government in a narcotics case, which would have required the company to disclose a customer's private emails stored on a server in Dublin, Ireland. Microsoft hailed the ruling as a victory for digital privacy rights. It "ensures that people's privacy rights are protected by the laws of their own countries; it helps ensure that the legal protections of the physical world apply in the digital domain; and it paves the way for better solutions to address both privacy and law enforcement needs," Microsoft president and chief legal officer, Brad Smith, said in a statement. The ruling comes as a relief for U.S. tech companies doing business overseas.
  • Google under fire by the Commission. The search giant was slapped with a fresh set of charges for suspected violation of EU antitrust rules by the European Commission on Thursday. The Commission accused Google of stifling consumer choice and innovation. It issued a statement of objections to the company, which claimed Google restricts certain third-party websites from displaying search advertisements from the company's rivals through its AdSense for Search platform. A supplementary statement of objections reinforced charges made in April 2015, accusing Google of favoring its own comparison shopping service. This means consumers may not see the most relevant results to queries.
  • Will U.S. take cue from U.K.? In a bid to ensure that Britain "leads the way globally in embracing the safe development of driverless technology," the U.K. government said on Monday it is seeking consultation from motorists on its proposed new measures. The measures include a proposed change to legislation pertaining to vehicle insurance and changes to the Highway Code and regulations to ensure safe use of advanced driver-assistance technologies. Meanwhile, reports of a third crash involving a Tesla vehicle in Montana emerged this week.
  • Live capture. Twitter and CBS News said Monday they are partnering up to livestream the network's coverage of the Democratic and Republican National Conventions on Twitter's live platform. The aim is to give "people around the world the best way to experience democracy in action," Anthony Noto, Twitter's CFO, said in a statement. The stream will be available on both mobile and web apps, and it will also be accessible by those who don't have Twitter accounts. The social networking site has also signed livestreaming deals with Bloomberg and Pac-12 Networks this week.

Check out our previous Searchlight roundups on Google's push to master computer vision and the IT implications of Brexit.

Assistant editor Mekhala Roy contributed to this week's news roundup.

Next Steps

Why CIOs should get ready for virtual and augmented reality

AR/VR tech: The next platform for customer engagement

Augmented reality will change how people do work

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