Virtual Reality
Presumably the most famous of the three categories — devices are those that aim to completely replace the user’s experience with a completely digital one. The holy grail of VR development would be reaching a Matrix-like experience indistinguishable from reality that completely replaces what we perceive through all of our so far known 21 senses, presumably through direct neuronal stimulation with a brain-computer interface.
The current generation of VR devices focuses on vision (arguably most human’s primary sense) and hearing with devices dedicated to other senses being still experimental.
In their most basic form, VR devices feature headphones and a headset that straps a screen or two to the user’s face and lenses that make those screens appear further away and emulate depth through stereoscopy. More advanced devices make use of 3D spatial audio, waveguide optics that let a user’s eyes focus at different distances when looking at different virtual objects and sensors that thanks to complex algorithms understand user movement to allow real movement to be replicated in the virtual environment.
Augmented Reality
Instead of completely replacing it with a virtual alternative, intends to augment our everyday physical reality with digital elements. Think of a real-life heads-up display (HUD), not unlike the one you are used to seeing in video games that could show you where you should turn to reach the location you are heading to, or your phone’s notifications.
In its more advanced versions, virtual objects can interact with the real world. For instance, a virtual ball can bounce off a real surface or cast a shadow on it. In industrial applications information from advanced sensors and artificial intelligence could enrich the user’s perception of reality for instance by allowing to see live wires inside walls thanks to electromagnetic sensors or veins inside a patient’s body thanks to infrared sensors. The key is that in augmented reality, physical reality is always front and center, it is just augmented by virtual additions.
Mixed reality is a cross between AR and VR that can range from a physical environment augmented by elements from the virtual world to a virtual environment enriched by real elements. Arguably, one basic example is the “guardian” system featured in Meta’s Oculus Quest devices that shows you the real world alongside a wireframe of the playing area whenever you get too close to a wall to help you avoid hitting a real object and hurting yourself.
An already existing and well-known example of a mixed reality device is Microsoft Inc.’s (NASDAQ: MSFT) Hololens. The company also released a good explainer video about what Mixed Reality is back in 2016.
The last key term in this space is extended reality, it is a concept encompassing any technology that alters the reality that we perceive by adding or subtracting elements from our perception resulting in a mix between the physical and digital. Extended reality includes the whole “virtual continuum” including AR, VR and MR.