BY DR. ANTHONY CHAN former Chief Economist at JPMorgan CHASE
Anthony Chan (born c. 1957) Chief Financial Officer at Spychatter Inc., former Managing Director, Chief Economist at JPMorgan Chase & Co. He appears several times per month on CNBC, and is often featured in other media outlets such as Fox Business News, CNN, Reuters, Squawk Box, Bloomberg Television and public television’s Nightly Business Report.
Chan, a Puerto Rican-Chinese-American, earned his B.B.A. in Finance and Investments degree from Baruch College in 1979, and his master’s (1983) and doctorate (1986) from the University of Maryland. He has worked as a professor at the University of Dayton, and was an economist at the Federal Reserve Bank and at Barclays. He has been with JPMorgan Chase since 1994. From 1985 to 1986, Dr. Chan was a Doctoral fellow at the Board of Governors of the Federal Reserve in Washington, D.C.
Despite the growing use of AR some people are still unsure of what this software product really offers. To be sure, AR provides an enhanced interactive experience (utilizing computer-generated perceptual information) using objects that are found in the real world. Essentially, this product combines the features of the real and virtual world and offers real time interaction while creating 3D images of both a real and virtual world. Using this technology, the sensory images that are created can selectively augment or diminish selected images found in the real world.
Dr. Agostino Sibillo just launched a new line of products that is offering AR technology imbedded with a military grade of encryption. The new company is a licensee of a SpyChatter that was created in 2014 by Dr. Sibillo who now holds several Patents that will permit individuals using this patented AR technology to send and receive encrypted messages to specifically selected locations that could only be retrieved and read by the intended recipients of such messages.
SpyChatter’s revolutionary technology protected by multiple Patents have widespread applications for the US Military (who is currently using AR (in its defense programs) and for many other sectors in the US economy including Social Media.
On the Military front, a study by “Market Study Report, LLC, 2019) estimates that the Total Addressable Market (TAM) for the US Military using AR will grow from approximately $800 million dollars in 2020 to $1.8 billion dollars by 2025.
Given the robustness of the Company’s multiple Patents on AR, I believe that the new branch of SpyChatter alone can capture 10% of this military TAM. The Net Present Value of revenues from this TAM is equal to $7.0 billion dollars from 2020 to 2025 (using a reasonable 5.0% discount rate which is roughly equivalent to the current US Prime Rate today), the value is $7.0 billion dollars. Under the very realistic assumption that SpyChatter’s licensee company can capture 10% of this market, the NPV is estimated (from 2020 to 2025) to be equal to $700 million. Keep in mind that I’m being overly conservative because there is no reason that the company couldn’t sell this same technology to many of our military allies within NATO which will easily magnify this figure several fold.
The rest of the AR Market it is much bigger. To be sure, Kenneth Research, 2019 estimates that the Global Market for AR will grow from $4.3 billion in 2020 to $149 billion by 2025.
Estimating the Net Present Value of such revenues from 2020 to 2025 (using a 5.0% discount rate) yields an estimate of $277 billion. Although I am confident that SpyChatter’s new line of military products could garner a larger share of this market, my analysis projects the Net Present Value of this market for our licensee if the Company captures just 1.0% of this market at $2.8 billion dollars. Using these conservative estimates, I believe that the market value of this new line of products is within the range of $2.5 to $3.5 billion dollars. The range is wider than our simple point estimate because I believe that while the Company can reasonably capture 1% of the Global TAM, it will be able to capture a much greater share of the US Military market for AR.
And apart from the US Military area, companies will be able to utilize data they have collected on individuals to send targeted ads as they traverse through geographical locations offering products that are closely aligned with the specific preferences of these individuals. The possibilities are endless from a store selling a highly sought after product by a consumer to a Real Estate firm with home listings that offer a critical set of features desired by a prospective homeowner. Throw in a few algorithms that can interact with weather conditions and it could get really exciting. For example, if an individual showed a preference for a specific soft drink, meal or even a clothing garment that was highly influenced by the temperature outside, the AR experience could generate advertisements for specific products that were tailored to an individual’s specific needs as an individual walked or drove through specific areas offering such products or services.
Agostino Sibillo INVENTOR OF AUGMENTEd Reality sharing: geolocation based encryption
Taking a closer look to SpyChatter reveals that within the last couple of weeks the company has also received additional Patent approvals that will now firmly establish the company’s dominating presence in AR. To be sure, the latest approved Patent allows the Company to control the next generation of AR that will facilitate the sharing of information between users in a way that has never been experienced in the past! With this new and more powerful capability, AR can now be used to send text messages, conduct social activities, create exciting advertising opportunities and offer individuals the ability to play online games with friends!
Companies that I believe would greatly benefit from SpyChatter’s revolutionary technology include (but are not limited to): Alphabet’s Google Maps, Niantic (Nintendo), Pokemon Go, Facebook’s Oculus Rift along with Apple’s upcoming 5G iPhones!
Who else is using AR today?
Currently, AR has permeated many facets of our everyday life and entered many different sectors of our economy including Retail, Marketing, Education, Military Training, and Healthcare just to mention some of the more prominent sectors using this technology.
On the retail front, cosmetic companies now use AR to allow individuals to see and experience how they would look using a variety of their product offerings using this exciting technology without requiring a person to sit down and place multiple layers of its products of an individual. Gone are the days when a person had to sit on a make-up chair and listen to someone say – let’s look at what this shade will do to your complexion. Now individuals can review all the offerings from a cosmetic company from the comfort of their own homes using this technology and then order the products on-line after they find the look that they desire.
As part of their marketing efforts many furniture companies have traditionally spent lots of money staging their products inside brick and mortar stores or in expensive brochures that were mailed to prospective customers. Now with AR, an individual customer can superimpose the items sold by a company online using their own living quarters and examine the attractiveness of those products without having to leave their homes or having to strain their imaginations to picture how they would look inside their homes!
On the education front, imagine employees that work in dangerous environments that must be trained to perform in such environments. Without AR, a company would face the risks of endangering its workers while also incurring the costs of damaged equipment or tools. With AR, a lot of this training can be simulated again and again to enhance worker performance without incurring many of the aforementioned risks or costs. Or imagine a student in a Science Class studying the planets being able to see them positioned without having to get on a space vehicle and personally visiting the outer limits of the earth to gain a better understanding of the Universe!
Even a history student curious about how a specific location looked like a hundred or a thousand years ago. All this will be possible with AR and hopefully keep students better engaged.
On the military front, many countries are already using AR to train future soldiers in real life dangerous situations without exposing its students to the real dangers that one encounters by making such training more realistic.
On the healthcare front, therapists are now beginning to treat phobias or anxiety disorders using AR to simulate stressful situations for its patients. By tracking a patient’s heart rate, perspirations or physiological reactions they can gradually moderate the exposures to such phobias until a person starts to gradually eliminate the fears a patient had prior to receiving such treatment.
Given the superiority of SpyChatter’s next Generation Patents in AR, I believe that the new line of “military Grade” products can capture 1% of the Global Market for AR. If we once again, estimate the Net Present Value of the revenues from this global market from 2020 to 2025 using a 5% discount rate, we generate a net Present Value of $2.8 billion for Shield Defense. Nonetheless, I believe that with some hard work, the company would be able to easily capture more than a 1% share of this TAM.
The possibilities of super-fast mobile networks made possible by 5G or even 6G will surely boost the potential of using AR in endless ways well beyond 2025. Today the average home broadband delivers well under 100 megabits per second but with 5G – those transfer speeds could jump to 3 gigabits per second! At such speeds, individuals will be able to stream AR data directly from the cloud instead of having to be directly linked to powerful home PC’s. And although streaming AR has been possible for years – the process has been painfully slow but with 5G or 6G - this problem will no longer be a major constraint as individuals will no longer have to use a low-bandwidth, low-powered environment to utilize this software which greatly enhances the outlook for SpyChatter’s products.