While funding for Chinese AI companies is showing signs of drying up, Rokid has managed to buck that trend. The Hanghou-based tech firm announced in March that it had raised $ 110 million from undisclosed investors in a Series C funding round. The company backers in previous fundings have included the likes of Temasek, Credit Suisse, IDG Capital, Haitong Security and Vision Plus Capital.
Founded in 2014, Rokid is an AI hardware company that develops smart products, the most notable of which is its augmented reality (AR) glasses. The company glasses are able to superimpose digital images onto the user’s view of their environment and respond to basic hand gestures. Primarily used for training and industrial uses, Rokid has three models of AR glasses already available.
AR and the broader term XR (extended reality) which encompasses both augmented reality and mixed reality (MR) has come into and then fallen out of favor several times — but this time may be different. Its latest reincarnation in the decades-old sci-fi concept called the metaverse is gathering momentum among the biggest players in the tech world.
Rokid’s cofounder Misa Zhu believes that the next computing platform (his preferred term for future virtual worlds) should help people blend the best of the physical world and the virtual world, instead of deepening the divide between the two. He believes that technology should not push people further into the oblivion of what’s around them. The type of shut-eye immersive experience heralded by Mark Zuckerberg will trap people in a virtual cocoon.
While the company products have so far focused on the enterprise markets, do not be surprised if it expands to the consumer market. The company recently announced a strategic partnership with ARM China to jointly develop the metaverse ecosystem, which basically means that Rokid’s future AR glasses will use XR chips developed by ARM China.
With the Chinese government pouring money into the domestic semiconductor sector, chips are something the company could potentially get back into again. In 2018, Rokid released a self-developed speech recognition chip it had developed called Rokid KAMINO18.
Below is an edited account of our discussion.
Nina Xiang: How are Chinese tech companies getting ready for the metaverse?
Misa Zhu: I think all companies can see that the next generation of the internet will be a new computing platform, whether it’s virtual reality, augmented reality, XR, or the metaverse, it’s still to be seen.
Everyone is exploring at this time what the ultimate product format will be. Meta has more focus on VR. Microsoft focuses more on AR. Apple is rumored to release some kind of mixed reality (MR) product. We at Rokid believe in AR, or a world where people are still grounded in physical reality with augmented experiences, instead of being transported to a completely different virtual world.
All the big technology companies are targeting the mass market, where the greatest potential will be. Meta has achieved some success with its Quest VR headset, but at a huge cost. We still need more time to see whether Meta’s investments, on the scale of tens of billions of dollars, will prove to be worthwhile. Therefore, at this initial stage, there won’t be many other companies who are going to be as devoted as Meta to stomach this much risks.
But Meta’s success and tens of billions are putting pressure on other companies, because Meta could extend that lead and become the earliest and clearest winner?
We at Rokid have a deep belief in AR. At a philosophical level, we do not want to push people further into the virtual world and further into the oblivion of what’s right around them. We want to create a harmonious co-existence of our physical world with the digital world, instead of dividing them further.
In terms of technological development, VR will lead initially while AR will catch up and potentially be the more pervasive technology. They could also merge into one product. Many big tech companies have not yet placed their bet, so many things are still to be seen.
What are your own projections?
I think users will vote with their “head.” Rokid has sold over 10,000 AR glasses. It’s still very small compared to Meta’s Quest VR headset, which has sold around 10 million. But AR users wear their AR glasses at twice the amount of time compared to VR headset users. It’s far more convenient and comfortable to wear AR glasses, which won’t make people dizzy and disoriented.
Are Chinese companies lagging American firms in the build-up of the metaverse?
On the infrastructure layer, China will be lagging the US in the next five to ten years at the least. In the era of XR, which I believe is the next computing platform, it will still be a competition based on chips, operating systems and ecosystems. Unless China can change its competitiveness in these areas in a short time, China will still be a laggard.
But in terms of product market scale and applications, it may be different. During the mobile internet era, China did not follow the lead of the US completely. Both countries had their own strengths, with China being quite innovative in business models and products. There are even times when American companies “copied” Chinese methods. So China has a chance to lead in application, user scale and growth rate in the transition to the next computing platform.
The metavese will be developed during a time when tech decoupling between the US and China deepens. How will that impact China’s future virtual worlds?
Our next computing platform has an important feature: they are mostly wearables. VR headsets, AR glasses, and other metaverse products need to be lightweight, compact, and capable of long-time usage, which means they require semiconductors with ultimate performance and low power consumption. So they must use the most advanced chips currently available in the market, which China will not be able to make on its own for some time.
What about products, business models and user applications, how will China’s ecosystem be different?
Chinese users are highly adaptive, which will carry over to the next computing platform. For example, the very high penetration rate of mobile payments in China could lead to users adopting novel payment methods more quickly.
People will consume similar types of contents in the next computing platform, like gaming, videos, social network, shopping, and entertainment. Chinese companies could continue to lead in innovations in these applications.
Overall, China could migrate to the next computing platform faster than the US Coupled with Chinese users’ ability to adapt quickly and their massive consumption power, there are massive opportunities in China in the next chapter of computing.
Will China’s tech crackdown slow the development of the metaverse?
Tighter regulation won’t have much impact on the success or failure of a particular computing platform. So I do not think China’s strict tech regulation will significantly impact the development of future computing platforms.
But China’s ban of cryptocurrencies and NFTs could mean that its metaverse ecosystem will be different in the area of the blockchain and Web 3. So the so-called decentralized metavese might not work in China.
I believe China will want to promote the development of the next computing platform from the angle of chips, operating systems, software and manufacturing supply chains to assist the development of the real economy.