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Magic Leap: How Augmented Reality is Elevating Enterprise

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Episode Summary

Magic Leap is a market leader in Augmented Reality (AR) headsets and continues to push the boundaries of what AR can do in enterprise. Chief Transformation Officer, Daniel Diaz, discusses Magic Leap’s evolution as a company, their ongoing headset innovations, and some jaw-dropping use cases and statistics he has seen over the past five years.

Augmented reality may seem like the technology of tomorrow, but Diaz explains that AR is changing the enterprise landscape today. From recruitment to skills training to employee retention, Diaz explains that AR is making a meaningful difference in manufacturing, healthcare, law enforcement, and beyond.

Tune in to the full podcast to learn more about Magic Leap’s experience in augmented reality, real-world statistics from their customers, and innovations they’ve made with the Magic Leap 2 headset.

Key Moments

  • Getting started with Magic Leap (03:38)
  • AR overcoming barriers to adoption in enterprise (07:40)
  • AR benefits for enterprise (11:15)
  • Stories of AR in enterprise (13:00)
  • Benefits of XR training (16:05)
  • The presence of the Metaverse/AI (18:04)
  • Transparency in AR design (20:30)
  • AR in healthcare use-cases (23:28)
  • Friction points for adoption (27:50)
  • Future of AR (31:40)
  • Reflections on AR and Magic Leap (33:06)
"I think the number one thing that anyone can do to drive better adoption and remove friction from AR is to help people understand the platform’s ability to deliver value now, at this moment in time. There's no arguing whether it has more efficiency, cost savings, or better outcomes. Those are things that you just can't argue with."
daniel diez of magic leap headshot
Daniel Diez
Chief Transformation Officer at Magic Leap

About the Guest

Daniel Diez is the Chief Transformation Officer for Magic Leap, a leader in enterprise Augmented Reality technology. In this role, Daniel is responsible for business transformation within Magic Leap as the company continues to grow and refine its enterprise technology offerings, as well as helping advise Magic Leap customers on how to use AR technology to optimize and grow their businesses.

Daniel also oversees Magic Leap’s corporate, brand, and product marketing in addition to public relations, communications, and government relations programs – all designed to build the company’s corporate reputation, grow awareness of the company’s enterprise AR offering, and create an understanding of the platform’s ROI.

Episode Transcript

Brad Scoggin: Hey there, welcome to “XR Industry Leaders” with ArborXR. My name is Brad Scoggin, and I am the CEO and one of three co-founders of ArborXR. And we’ve had the opportunity of working with thousands of companies since 2016, and we’ve learned a ton about what it takes for XR to be successful in your organization.

Will Stackable: And I’m Will Stackable, co-founder and CMO. This podcast is all about interviewing the leaders who are on the ground making XR happen today. True pioneers in the space from Amazon, Walmart, and UPS to Koch, Pfizer, and beyond to uncover the pitfalls, lessons learned, and secrets that you can use to help grow XR in your organization.

Brad Scoggin: All right, well, today we get to sit down with Daniel Diez. Daniel is the Chief Transformation Officer at Magic Leap. Daniel, it’s great to have you on today.

Daniel Diez: Thanks for having me, Brad, and Will.

Brad Scoggin: So we always like to start hearing a little bit about the guest’s personal background, and you’ve got a very impressive resume. One of the things that stood out to me was your early background in psychiatry. So I’d love to hear maybe about how that has impacted your perspective even in your role at Magic Leap.

Daniel Diez: Sure. I’ll take you back even a little bit further. My undergraduate was in opera, so I was a classically trained opera singer as a younger person. And then transitioned into studying psychology and got into doing a lot of clinical research for psychiatry. It was a fascination of mine. And did a lot of research looking at how medications are used and how effective they are in treating psychosis in very young children. That led me to go to medical school, which is something that… Fascinating, very difficult, and something I did not enjoy very much. It took some time to regroup and did a great fellowship with the American Psychiatric Association around bipolar disorder. And looking at those modern treatments versus sort of very traditional therapies. And then, when it was time to head back into medical school, I actually decided to take a step back and go back to what I really loved. Which is figuring out how to communicate and market things that are really complex and hard to talk about. But that’s really what I love to do.

Brad Scoggin: That’s awesome. That’s from opera to psychiatry to marketing. Very cool.

Daniel Diez: So it makes for an interesting set of skills. So opera is very performative, and so you learn how to deliver messaging in a way that’s highly effective. Psychiatry and the medical piece is all about understanding how people need to hear messages in order for them to understand you in the way that you want to be understood. And you put very analytical research into that. And so you have a very interesting combination of performance, lots of analytics, and then the ability to deliver messages in a way that can be received by your listener and in a way that you need them to be. And it creates an interesting strategic framework for taking things to market.

Brad Scoggin: Yeah, absolutely. Well, and that’s a great kind of segue into the next question. So I think one of the reasons you were brought into Magic Leap was to help with this very public transformation from a consumer company into an enterprise company. And for those that don’t know, Magic Leap is a very impressive company. It’s been around, I think, since 2010, with over 4,000 patents. So very, very impressive, but a huge shift from consumer to enterprise.

Daniel Diez: Yeah. Yeah.

Brad Scoggin: And I would love to hear as much as you can and will share about what that process has been like how you approached it.

Daniel Diez: Sure.

Brad Scoggin: So yeah.

Daniel Diez: Yeah, happy to. So I was brought into Magic Leap in December of 2018 by the founder. And it was an interesting move because I was very much a B2B sort of marketing and transformation person. That’s what I had done for a big chunk of my career, helping companies move into different areas, established market presence. And so being hired into Magic Leap, which was very much a consumer electronic company, was an interesting move. And I talked long and hard with Rony about doing that and why he wanted that. And I think he knew that the shift on some level needed to happen. What ended up transpiring was that it became very clear that although Magic Leap One was an incredible piece of technology that bested everything on the market, there wasn’t a market for it. Because it was not a form factor that was consumer-ready. There wasn’t a content ecosystem available to consumers that made that device valuable. And so it was an incredible piece of tech pointed at the wrong market. And the right market actually came back to us in feedback during the launch of Magic Leap One from enterprise customers.

Brad Scoggin: Interesting.

Daniel Diez: Who was really finding an incredible amount of value in that. And asking us for modifications and, “When were we going to make the platform more enterprise-ready?” Because they saw value right now. And so Magic Leap 2, well, there was a shift. The company announced a shift to really focus more on enterprise as the consumer market took its time to develop. Magic Leap 2…

Brad Scoggin: That’s our one thing. When was that? You came in in 2018, so when was that?

Daniel Diez: 2018. Yep.

Brad Scoggin: And obviously, you were thinking about the shift. When was that announcement kind of public? When did the public part of the transformation start?

Daniel Diez: I think we first started to talk about it publicly. I mean, again, there were conversations with enterprise going on the entire time that I had been there. Probably toward the end of 2019 is when I think we made our first sort of public statements about how we’re going to focus on enterprise. And then the pandemic hit, and Magic Leap went through some radical changes. And a new CEO was brought in. And she brought with her, along with, it’s a 20-something-year career in technology. She brought unbelievable focus to Magic Leap. She agreed that enterprise was the right place to go, but she took it even further. She’s like; there are three verticals that we know that this technology can impact in the positive right now. And also three industries where the form factor is less of an issue because they’re already used to wearing gear on their head or over their eyes. So you think about manufacturing in certain industrial use cases where safety goggles are a normal part of doing a job. Medicine where they’re used to wearing, again, safety glasses or magnifiers already. And then in the public sector. You think about police first responders; you think about defense. All of them are used to wear headgear, and all of those industries also invest heavily in future technologies to evolve their businesses. So those became the three enterprise verticals that we knew would be first to hit. And then, we looked at the use cases that we thought would be most effective. And so those were training applications, 3D visualization, the ability to provide remote assistance. And that became the focus for Magic Leap as we began to look at the platform and the hardware and purposefully build those things for that enterprise market.

Brad Scoggin: Yeah, that’s super impressive.

Daniel Diez: Yep. That’s what you see today in Magic Leap 2 is that purpose-built device.

Brad Scoggin: Yeah, absolutely. I think it’s the story of anybody who’s been an XR for very long that you’ve got to have the guts to pivot. And we’ve had to do that, but our ship is a little bit smaller than your ship. So to make that sort of a radical shift, I think, is super impressive. But I mean, we’re seeing the same thing, and we weren’t in consumer; we were in entertainment. But it just feels like whether it’s AR or VR, the magic right now is in the enterprise. I think that’s where people are seeing the most powerful use cases. And to your point, I hadn’t thought about the form factor, that it’s more acceptable there. That’s a huge issue.

Daniel Diez: Yeah. We got a ton of feedback on form factor, by the way, before Magic Leap 2 came out. So we’ve reduced the volume, the weight of that device significantly. So it’s like 250 grams or so, and it’s about the same weight as a pair of Bose earphones. They wanted the ability to wear it all day long. They wanted longer battery life. And then they needed us to overcome barriers to adoption, namely image quality, color fidelity, text legibility, all things that people really struggled with. And one of the big ones was, how do we increase the number of environments that you can use this device in? Because AR is a light additive technology, so you’re competing with natural light all the time. Too bright, too shiny an environment, and you get washed-out imagery. And that’s where dimming came in to be. And so we figured out a way to actually create black in the field of view, which is incredibly challenging to do, but we figured out how to do it both in sort of small portions in the field of view. Or let’s just segment the dimming or globally dim the entire background so that if you’re in one of those environments, you can still access that information. So you can think about a surgeon wanting to be able to still see his patient in full light, but then have data feeds above him or her with dimming behind them, so they could really have high contrast of the environment they are in. And you can do that with the Magic Leap 2 platform. So those were all the sort of things that we looked to put into the next device so that they answered those challenges, those barriers to adoption that have really kept XR and AR from really entering the enterprise in a significant way.

Will Stackable: Could you talk a little bit more about how you see the Magic Leap 2 headset positioned in the market? And maybe, you mentioned a few key differences, but any other things that you feel like are advances or innovations that you guys are bringing to the market with it?

Daniel Diez: I mean, I think that the things I talked about were the big ones. Those are the big challenges that really enterprise was looking for us to solve for them. I’m excited about the fact that we really did that. I think one of the things that makes me most excited about the platform is that there’s still room to go. There are other platforms out there that chose different technologies for projection than we did. And although they went to market faster than we did, what they found is that the platform is now dead-ended at its current set of capabilities. Whereas we still have sights on increasing that field of view and crisping up those images, and delivering even more value through the engineering platform that we chose for projection. So what I’m excited about is that this is a platform that has longevity. That we have sight to the next generation and the next generation after that. And we can talk to our customers about that. We can bring them into our ID lab and show them the models around shrinking down that device and showing them what that’ll look like. And giving them a line of sight both in the optics, the hardware side of it, how we’re going to get there. And so that gives great confidence to customers knowing that we have a line of sight for multiple generations of devices. And that the platform is still capable of delivering them.

Will Stackable: So a lot of our listeners are in the enterprise space. Many of them have either done pilot projects and are scaling, or they’re thinking about doing their first pilot project. Could you zoom out a little bit when you talked about the specific technologies that are different? But as far as the enterprise platform you guys are bringing to market, whether that’s the sales process, the warranties, the financing, the support. Talk a little bit about what you’re offering to the enterprise audience that you’re looking to hit.

Daniel Diez: Well, I think that the device is now built for enterprise environments. So you think about security protocols, data, we’re cloud-agnostic, so we’re as open as you possibly can be. Our mission for Magic Leap is to really push the technology forward, and make it as useful as possible. And so, for us, that’s our business model. We’re trying to get as much of this tech into the market as possible. So a walled garden for us. Figuring out how to use data in other ways to gain insights about your customers or drive storage. That’s not in our business model. We are about making sure that the device delivers the most value to the end user. And so we’ve built the platform in that way. And I think it’s incredibly attractive to our enterprise customers. So not only is it now battle ready for integration into a true IT stack, it’s also giving them the flexibility that they need to control all the data that they have. To control how the individual users on the floor of the factory or in a hospital use that. If you want to go into kiosk mode and limit that device to one function, you can do that. You want to open that up; you can do that. But those are critical things that we had to answer before we could truly call this an enterprise device. It’s not simply about the field of view and the tech specs. All those things were super important, but it also had to be a real piece of enterprise tech.

Will Stackable: Love it. Do you have any specific customer stories you could share with the ML 2 that would get us excited?

Daniel Diez: Sure. I think you think about the use cases. Training is one of the ones that I think is most surprising. And not because it’s hard to imagine us using AR for a training thing, but the benefits of it actually are the surprising part. So there’s this great company out in the Midwest called PBC Linear, and they’re using Magic Leap to train new employees. They were finding that they were losing their manufacturing employees at a high rate because they were retiring, and they were struggling to bring on new employees. So before those employees left, they wanted to make sure they had a means of capturing all that tribal knowledge. All this stuff that you just know by working there for 20 years. How do you capture that and turn it into a training scenario so that new employees can access that when they run into trouble? And so they use Magic Leap and a solution called Tactile, and they built out this training system for training folks on the line.

Will Stackable: Interesting.

Daniel Diez: So instead of going into a classroom and learning through presentations, books, and videos, you’re learning on the floor, on the line. And what they found was it reduced training time by about 80%. And it reduced manufacturing waste by 25%.

Brad Scoggin: Wow. Wow.

Daniel Diez: So now they’re training faster, and they’re training better because there’s less waste. The interesting thing was that when they introduced the Magic Leap device into the recruiting process, recruiting became easier. Because the job wasn’t seen as sort of old-school manufacturing, it was seen as a high-tech job. And then the really interesting part was employee engagement went up by about 30%.

Brad Scoggin: Wow.

Daniel Diez: So now, not only are you recruiting them faster, you’re training them faster, they’re better at the job, but they’re also staying longer because they’re engaged in the work. And that it gets at the very heart of the biggest crisis phase in manufacturing. It’s not the supply chain, it’s not material costs, it’s not shipping, it’s not the recession that everybody’s worried about is coming; it’s about people. And this training application is a solution for that. And that, to me, is incredible. That’s one of the great things about AR is that, even when a solution is designed to do one thing, the other benefits that come with it are incredible. And discovering those things and figuring out how to bring those to market. And help companies understand how to leverage this technology for those things; that is what is really exciting about this moment in AR.

Will Stackable: I love it. I think training is a huge use case right now that we’re seeing exploding in the enterprise space. And in some ways, it doesn’t surprise me because you’re competing against essentially somebody watching a horribly produced 2D video, or a textbook, or a PowerPoint and then answering multiple choice tests versus actually simulating in real life and being able to see it. I love the idea with AR that you can. Actually you can mix reality. So you can have an overlay, and whether that’s medical or manufacturing, it’s so much more tactile.

Daniel Diez: Sure.

Will Stackable: You’re actually doing the thing with your hands and creating that muscle memory. I love the stat too. Did you say 80%? That’s huge…

Daniel Diez: 80% faster training. That muscle memory that you…

Will Stackable: Wow. So when you have numbers like that, it starts turning heads at the leadership level. That’s where, if you’re trying to justify the cost of implementing new technology, what else could you do where you get an 80% improvement?

Daniel Diez: Yeah. There are not very many things that you can point to that says it’s that dramatically better. Right. So you mentioned something about muscle memory. I think that’s a key part of the training aspect. So we have a company called Avrio that does a lot of first responder training, active shooter training, and safety training. And what I never knew about the training of police officers for active shooters is it doesn’t happen as often as that they would like. It’s really expensive. You’ve got to build physical sets; you have to hire actors, you have to fly people out to do it. It’s really intensive when it comes to the expenditure for a local police force to get that training for their officers. With Avrio’s solution, they can build out digital environments, or they can augment physical environments digitally so that there are an infinite number of scenarios they can walk these officers through and they can train over and over and over again. And get those neural and muscle memory connections. So that they’re not surprised, and it becomes a very natural response. Something they’ve been trained to do. And what their hope is, is that it’s better outcomes. Police officers are better prepared for those scenarios, and they can better respond. And hopefully do so with less force than would otherwise be necessary.

Brad Scoggin: Yeah, I love it so much. I mean, it’s just, for those of us who have been in XR for so long, I think sometimes it’s like we’re just in it; we’re fighting the battle every day to push these things forward. And it’s so good to pull back and kind of see, okay, there’s some fruit of all of our collective labors. That people are learning faster. For dangerous or difficult tasks, we can do them in a repetitive way, in a safe environment, at a lower cost. It’s really, really, really exciting. I think sometimes we talk about, let’s make sure we appreciate this moment that we’re in because there will be a time when we look back and this will all just be normal. And we’re in the transition right now, which I think is super, super cool.

Daniel Diez: Yeah. We’ll look back and wonder, “How did we do any of these things without AR?”

Brad Scoggin: Yeah, exactly. Right. We hear 80%, 75%, and 60%; I mean that type of improvement in learning all the time. And I think we will look back and think, “You used to spend this much time doing that.” And…

Daniel Diez: Yeah.

Brad Scoggin: It’s really fun. It’s exciting, and it is cool too…

Will Stackable: That’s why we got into XR in the first place, really.

Brad Scoggin: Yeah, exactly.

Will Stackable: Yeah.

Brad Scoggin: It’s cool to see that holo gaming, and that stuff is fun, and having fun is good. It’s cool to see that there are really meaningful use cases that are kind of driving this whole thing forward.

Daniel Diez: Yeah. It’s interesting that you keep seeing videos out about “Someday in the metaverse.” And, “Someday with AR, you’ll be able to do this.” And someday, someday. And it’s funny to me because actually, that someday is right now.

Brad Scoggin: Totally.

Daniel Diez: There are surgeons taking this magically into the operating room. There are people doing training; there are people reducing that time to train on a factory floor. Solving real people challenges. That someday is right now. And it’s incredibly exciting to see the ecosystem catching up to the hardware and those things being implemented and really creating real change.

Brad Scoggin: Yeah, absolutely. And no, it does feel like it’s kind of happening behind the scenes almost. We’re up to, I think, we’re working with 80 of the global Fortune 500 companies. And we’re talking about some of the biggest, oldest companies in the world that you would never guess have this massive XR initiative. And it is because of such results.

Will Stackable: Some of them have been working on it for eight-plus years, and they’re just now starting to go to scale…

Brad Scoggin: Yeah. Yeah. It’s just now starting to come out, yeah.

Will Stackable: With multiple different use cases. It’s just taken that long for them to really figure it out. And for the technology and all the people and processes and everything to mature.

Daniel Diez: And I look at AI right now, and it’s having another moment. So, you guys can remember when IBM’s Watson became a huge thing. And it was like, “Oh, Watson’s on Jeopardy, and it’s beating so-and-so in chess.” And then it just went away, or so we thought, right? And actually, what it ended up doing is completely revolutionizing the advertising industry. And you had all these incredible inference engines built, and it turned out to be churning out trillions of dollars of value quietly. And now ChatGPT sort of brings it back, and everybody’s like, “Oh, AI, that’s amazing.” It’s like, “Well, actually, for the last 10 years, it’s been revolutionizing whole industries. I think AR is in that moment too, where you see these bubbles happen and people get interested. And then they go quietly away and do the hard work of figuring out how to make it really valuable.

Brad Scoggin: Exactly. Right.

Daniel Diez: And now we’re in one of those moments where that implementation is happening.

Brad Scoggin: Yeah, no, that’s a great perspective. I love that. Another question. So some of our team, we’re working with you guys on go-to-market, and we’re offering the free 90-day trial, I think, for customers who purchase Arbor along with your headset. And so some of our team got to go and tour your factory. And I know they were just very, very impressed. I mean, with just how open and transparent, and the process, and the way you’re thinking about things just across the board. They’re just very, very impressed. I know in a recent interview, you talked about another shift within Magic Leap of going from just being a bit more open and transparent with the public. Could you talk about that shift?

Daniel Diez: Sure. I mean, I think Magic Leap had been famous for how secretive it had been. And I think that when Peggy came in, it was sort of like, “Why? Why would we do that? Let’s open up the doors, open up the Windows, show people what we’re doing.” The technology it’s very well protected. And it’s not exactly like somebody could just pop up and try to replicate what took us a decade to figure out and sort of patent. So there was no reason not to, and it gave us a huge amount of credibility. When we were bringing Magic Leap back to market as an enterprise company, that was a big credibility builder. Here are our optics; here’s how we built them; this is how they work. When we started to trial the device for tech, media, and analysts, it was, “Give us the early feedback. We’re nine months, six months away from launch. Let us know what you think. We want the device to be super useful. We want it to be well received.” And we got great feedback, and we’ve had a great response to it. And we’re excited about the relationship we now have with the market. Which is open, transparent, there’s lots of two-way conversation. Our early access program gave us a ton of data on what our customers were really looking for, how they were really using it. And now we’re seeing the fruits of all that effort with these incredible ISV solutions coming to market that were built on all the information they were able to get from this much more transparent Magic Leap.

Brad Scoggin: Yeah, definitely. I think we’ve gone through again smaller ship, but it is hard when you’re running a company with an emerging technology. There is this, should we be secretive?

Daniel Diez: Fine line. 

Brad Scoggin: Should we not? Yeah. We want to honor our investors; what’s the wise path? I will say what we found again and again. And Will’s always been really good at pushing me on this, is I don’t think there’s ever been a time when we’ve been transparent that it wasn’t a good thing. And every time that we thought we needed to be secretive, I think we kind of looked back and thought, “No one even cared.” So I think it’s hard to make that shift. It is kind of this risk, you got to jump out, but we found the same. That the market appreciates it, and that if you’ve got real value and you’re building strong relationships, you are protected for the most part. We found that to be…

Daniel Diez: That’s right.

Brad Scoggin: I’d love to hear you mentioned at the very beginning the three different verticals that you’re focusing on. Is there one of those for you personally that you’re most excited about? What is the benefit AR can bring over traditional learning or training, whatever the case may be?

Daniel Diez: I think with my background, the healthcare side of things gets me very, very excited. I’ve seen some unbelievable applications that have the potential to really radically change the delivery of care, access to care, and better outcomes for patients. It’s one of those moments where, 10 years from now, we’ll look back and say, “How did doctors do this without visibility to have all this information at their fingertips?” There are two that I find really especially exciting right now. One of them is a company called SentiAR. And what they’ve done is they’ve created a solution that helps a doctor with cardiac catheterization. So if you currently have a cardiac catheterization procedure, the doctor will insert the catheter into a vessel. And then they’re looking at a 2D screen over here while your patient’s over here. So it’s screen, patient. And you’re navigating while looking at a 2D version of what you’re doing. It’s incredible the mental gymnastics we ask the physician or the operator to do. With SentiAR, you get with the catheter goes in, and it feeds back the device information that allows them to create a 3D model of the vessel that the doctor is going through. And so now they have real-time feedback and real-time visualization of where that catheter is in the body. So you can imagine what that would do for the accuracy and safety of the patient. And so that is something that we would never have seen before. I saw another one from a company called Polaris; it’s based out of Miami, that is going to revolutionize the accuracy of knee replacements. Currently, the state-of-the-art is a million-dollar robot that really only gets used in major hospital centers, university medical centers, major urban centers that sort of thing. And so it’s funny that the doctors who do the most procedures are the ones who can afford that machine, but they’re also the ones who are most expert but probably need it the least. What Polaris has done is they’ve created an incredible way to use AR to guide the physician or the surgeon in measurements and where to cut while doing a knee procedure. Because in a knee procedure, they cut the bone on both sides of the knee, and they put in a replacement joint. The device can help them understand and pre-visualize where they’re going to cut, what impact that’ll have. And the intent is that it incredibly increases the accuracy of those cuts and where they should be. They’ll do it at a fraction of the cost. And what that means is those doctors who don’t do the procedure 10 times a week are going to be able to deliver that same level of accuracy at a fraction of the cost. So now, community hospitals, smaller places, and more rural areas now have access to this. And the patients now have access to better care through these incredible innovations in AR. And so those are the things that get me excited. Seeing better outcomes for patients and getting that level of care reach people who would never get it before, who would not have access to it before, those are truly exciting things. And from my background, they’re some of the things that get me most excited about AR.

Brad Scoggin: Yeah, that’s really cool. My wife is also a physician, and I think she’s had several friends for fellowship. They would go across the country for two years, and be away from their family to get that specialized training that can now potentially happen at home. Which is really cool. And I think too about the cadavers; I know they’re moving some cadavers into VR, AR. And even that, the way that that went down, they would have a dinner with the family who donated the body, which is important. You want to honor that, but it’s just such a strange… I think we’ll look back and think, “Wow, is that really how we used to do it?” And now it can all be done digitally. Which is really, really cool. Another question. I think overall, I mean, we exist as a company to remove friction, as a simple way to say it. Reduce friction for the adoption of XR. And we talk a lot about you’ve got one shot at a first impression. There’s a lot of resistance to AR and VR out the gate for several different reasons. And there’s also just this inherent friction. I mean, there are several friction points all along the journey. And so I think all of us collectively are working; how do we remove the friction? How do we make this very seamless? What have you seen so far in the process of driving the adoption of AR? I mean, what are some of those friction points, and how have you all worked to overcome those?

Daniel Diez: I think some of them are the ones we talked about, which are basically on the design of the hardware piece of it. So those are big friction points for adoption. Because if you couldn’t get people to wear it, they wouldn’t. I think the other piece now becomes the delivery of value. So really about driving understanding in the marketplace about what the value of this technology is. That’s great that you have the most advanced, most immersive AR technology on the market. What does that mean? What does that do for me? How do I implement that? Is it going to be disruptive to my business in a bad way? What’s the right way to roll this out? And so those are the questions now we’re having to help our customers better understand as they progress down the path of developing POCs, and implementing these things and scaling them in their companies. Those are the questions we have to answer. I think the number one thing that anyone can do to drive better adoption and remove friction from AR is to help people understand the ability of the platform to deliver value now. At this moment in time. There’s no arguing with whether it’s more efficiency, cost savings, or better outcomes. Those are things that you just can’t argue with. They are things that everybody wants right. On the manufacturing side for training, those levers that we’re able to pull on. Faster training time, reduce the waste, faster recruiting. Those are all the levers manufacturing is looking to pull at this moment in time. And when we can show them that we can deliver that, it removes a lot of friction. Because when you have an actual solution for real business challenges, that removes a lot of it right off the bat.

Brad Scoggin: Yeah, I couldn’t agree more. We’ve seen that again and again as well. Is it if we can show results quickly? And it’s the results we know, but we need the decision-makers in these large companies to see and understand those. And then it’s pretty easy. I mean, it really does sell itself, I think, if you can get to that point.

Will Stackable: When your 80% reduction in training time, it gets a lot easier to justify the cost of a few headsets. Yeah,

Daniel Diez: Yeah. That’s right.

Will Stackable: And on the training side…

Daniel Diez: Also, one of the other big…

Will Stackable: Go ahead.

Daniel Diez: No, go ahead. No, one of the big barriers that we’re seeing is that there’s a confusion about the difference between VR and AR. And I think we suffer a little bit of iniquity from that, a bit of a hangover from enterprise investment in VR for applications that perhaps it wasn’t well suited for. And so we’re having to overcome that barrier now too. And I think the device, in its ability to allow people to see the physical world and be much more comfortable, does not cause eye strain, not cause nausea, not cause discomfort to the user. Our platform was built to avoid all those things. And so once people understand that these are radically different technologies, they have very different user profiles and use cases. That’s another big thing that I think we have to do an even better job. And now that passthrough VR is coming into the market, I think it’s another thing that we have to begin to explain, like, “Oh, well, I can still see the real world.” It’s like, try to catch a tennis ball wearing a passthrough VR device and see what happens. And nine times out of 10, you won’t be able to catch that ball because there’s that lag. And it sort of exacerbates even further some of that discomfort that folks are feeling with VR. I can’t imagine a surgeon operating with a passthrough device, with any sort of lag and any ability not to see the actual patient with their own eyes. The idea that you disintermediate the best computer to interpret the physical world, the human brain with cameras on a device, is… Yeah, it’s interesting to me. So I think we need to do a better job of really helping people understand how these technologies are different, what they’re actually really good for. And there are incredible use cases for VR, and there are incredible use cases for AR. I think we just need to do a better job of helping people understand which one is for what.

Brad Scoggin: Yeah, that’s a really good point. And that’s a great segue to a wrap here. So as we look at the next five to 10 years, AR versus VR, you kind of answered this already a little bit, but do you see the two competing? How do you think AR fits in over the long haul versus VR in enterprise specifically?

Daniel Diez: I mean, I see AR being the dominant technology. And not because I work at Magic Leap, but just because of the diversity of environments that you’ll be able to use it in. And the safety factor that comes in there. There are a few use cases where you’re going to be completely comfortable with being completely disintermediated in the physical world. There are stationary use cases where you don’t need to interact with folks. In most jobs, you need to be aware of your surroundings; you want to be aware of the people around you. I mean, hell, the promise of this device is that we can stop staring at this screen. And we can actually look up, and I can still look you in the eye and still get access to that incredible data and information I need. So for me, I mean, I think AR feels like it is the medium that’s going to deliver the most value, and it’ll be the one where we start to see mass adoption. Both on the enterprise side and then eventually as the ecosystem catches up and the form factor takes the right shape on the consumer side as well.

Brad Scoggin: Yep. Yep. That’s very good. Well, Daniel, we really appreciate your time today. This has been great. I love hearing the stories, love hearing the vision. And very excited to see what the Magic Leap 2 does in the marketplace. So thanks for joining us today.

Daniel Diez: Great. Thanks so much.

Brad Scoggin: Man. Really cool to see the shift from consumer to enterprise. And our kind of going down a similar path, understanding how difficult that is, I think it’s impressive. It speaks to where the market’s at. It’s also cool to see big companies like Magic Leap getting into more meaningful applications of the technology where people are getting their time back they’re learning faster. I mean, he had so many really cool stats when it came to really improving a company’s employee experience.

Will Stackable: We’ve been following Magic Leap really since the beginning, and I think they were early in AR, even for the enterprise space. And they started in consumer, and now they’ve shifted over. But it really is impressive what they’ve built. For the form factor, he mentioned 4,000 patents. There’s a base of technology there that I think as AR starts to take off… I think what interested me is his comment about trying to catch a tennis ball in mixed reality. I think there is a reality that we’re so focused on VR right now because we’re seeing it explode. But I think AR is coming. And I think when it does come, it’s going to be a significant technology that’s more accessible for the reason he gave. I mean, one can’t catch a tennis ball even with mixed reality. Two, not that many people want to have a headset that includes their vision. We want to see it. We want to see our environment, want to see the people around us. So I think it got me excited just about the potential of AR. And I think as they start to see penetration in the enterprise space, I think he’s right that, eventually, it will start to bridge over more to the consumer side of things. So it’ll be fun to see where it goes.

Brad Scoggin: Yeah, I definitely feel like there’ll be a lane for both. And it’s fun to see AR kind of finally starting to get a little bit of legs. I also really appreciate their focus on the customer and listening to feedback. And the willingness to be more open and transparent. I think that’s huge, and I think it’ll serve them really well.

Will Stackable: Well, a tangible point of that is that their last platform, the Magic Leap One, was built on; it’s now AOSP. And we can support it where it wasn’t possible for us to support the Magic Leap One. So I think that even their underlying technology infrastructure has changed to make it more possible for developers and for ecosystem partners like us to work closely with them.

Brad Scoggin: Absolutely. Well, thanks so much for joining us again. Make sure you subscribe wherever you consume your podcasts. And we look forward to seeing you next time.

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