Cui Haitao, the founder of Gudong Technology: Telling new stories about AR again, the customers are going to be bored. | The "Little Giant" of the Era

Introduction: With the advent of the era of hard technology, a large number of hidden champions, single-item champions, and specialized, refined, distinctive, and innovative small giant enterprises are starting to emerge. These enterprises are the core pillars of domestic substitution and also the reservoir for Chinese companies to become global ones.

Based on this, Yingke has launched a new column: The "Small Giants" of the Era. Through in-depth exchanges with founders and investors, more small giant enterprises can be seen and documented.

The following is the second article of this column.

Author | Wu Ruoyu

Editor | Peng Xiaoqiu

The AR industry is becoming restless once again, this time due to the explosion of AI.

This explosion also implies that a new round of "storytelling" competition has commenced. However, Cui Haitao, the founder of Gudong Technology, believes that the industry should be de-storified. "In the past, AR resided in the imagination of tech giants, and now it is immersed in the upsurge of AI + AR. The entire industry needs to be grounded." The AR industry has been embellished with too many tales by various tech giants, and the industry's appetite has been raised too high. If we continue to tell stories, customers will grow tired of listening.

When Cui Haitao entered the industry in 2017, it was the low point of AR, and he missed the market heat of Google's first AR glasses. Nevertheless, Gudong has maintained a financing rhythm every year and has successfully become a national-level specialized, refined, distinctive, and innovative "small giant". Currently, its revenue has reached hundreds of millions of yuan, and it plans to impact the IPO within the next 1 - 2 years.

In fact, the most recent recovery of the AR industry was accompanied by the rise of the metaverse concept, with Rokid, MagicLeap, etc. launching new products.

After years of accumulation and development, in which stage is the industry now? Some in the industry believe that the AR glasses are on the verge of an explosion, and an explosive growth will be witnessed in 2025. After all, in the first half of the year, the global sales of Ray - Ban Meta smart glasses have exceeded 1 million units, and the industry's growth expectations for AR smart glasses have further increased.

Of course, there are also opinions that the industry is not yet fully mature and remains calm.

"At present, the AR industry should be in the mid - stage and not yet in the mature stage. Although everyone expects AR glasses to be seamlessly integrated into daily wear, the existing lens display problem is still an unbroken bottleneck," Cui Haitao judged.

Objectively speaking, the AR industry chain involves many links. In terms of hardware, technologies such as optical modules and optical displays have not yet been breakthrough; in terms of software, AI algorithms and intelligent platforms need to be further adapted to the interactive characteristics of AR smart glasses. Moreover, the downstream market ecology has not been fully developed. Currently, there are mature landing cases in B - end scenarios such as industry and education and training, while the C - end market is still being explored.

Therefore, Gudong Technology initially chose the B - end market, where the price sensitivity is low, and attention is paid to the overall cost and long - term value of the product. It is also the key to making AR a key to the digital and intelligent transformation of the industry. Currently, Gudong Technology's B - end business covers new energy (lithium batteries), nuclear power, aerospace and other fields. Its customers include domestic and foreign leading enterprises such as China Southern Airlines, Tencent, and Schneider Electric, and the repeat purchase rate of major customers exceeds 90%.

In fact, as the market competition of AI large models intensifies, the competition dimension of the AI industry has shifted from computing power competition to the stage of competing for scenarios and landing. More companies hope to use the underlying platform tools AR and VR to break through the "last mile" of the landing of large models. Therefore, the integration of AI + AR brings greater imagination space for the ecological application of AR glasses.

According to Counterpoint data, the global shipments of AR smart glasses increased by 40% year - on - year in Q1 of 2024. At the same time, Apple Apple Vision Pro, Meta's new products, Samsung and vivo also plan to release products in 2025, adding another spark to the investment track of the industry.

In addition to the competition among giants, more new forces have emerged in the domestic AR market. Some are AI large model companies that have switched to the AR industry to seek business breakthroughs, some are hardware manufacturers that see the trend and seek cooperation, and some are start - up companies that have experienced the industry's low point and have technical accumulation.

Then, with the rapid development of various links in the industrial chain and the accelerated research and development of new products by various manufacturers to seize the market, how does Gudong Technology accumulate strength and prepare to break through?

The following is part of the conversation between Yingke and Cui Haitao, the founder of Gudong Technology Co., Ltd. (edited):

The AR Industry Doesn't Need Too Many Tales

Yingke: It is said that AR glasses are the best landing carrier of AI + hardware. Why?

Cui Haitao: From the practical situation, the performance of using other carriers is not good. For example, the use steps of AI speakers are complicated, and the application scenarios are also limited.

Therefore, the most core factor restricting the choice of carriers is the portability of the product. When the carrier is not a necessity for us, low portability will become its biggest obstacle. Compared with other terminals, glasses are more convenient to use and flexible. Users can free their hands and directly provide information interaction from the first - person perspective through the audio - visual system.

Secondly, the true Internet of Everything requires the carrier to be integrated into our lives. Devices like mobile phones and computers cannot free hands and lack interactivity; head - mounted display devices like VR are bulky and difficult to fit into people's daily lives.

The eyes are the most direct visual perception channel and the visual focus of human interaction. According to wellsenn XR data, the global shipment of ordinary frame glasses is expected to be about 1.56 billion pairs in 2023, and the future market size is very considerable.

Yingke: At present, many AI glasses products have appeared in the industry, and the prices are also very people - friendly. Why do we still need to continue to develop AR smart glasses?

Cui Haitao: AI glasses lack the visual interaction function of AR glasses. They only rely on chips for human - computer dialogue, and the information interaction is too slow. Although it is very popular in the market now, it is not a real smart glasses. It is a compromise under the unbroken technical difficulties of AR glasses and belongs to a transitional product in the intermediate state.

Yingke: What is the difference between the concepts of AI + hardware and hardware + AI? Which competitive dimension do you prefer? Compared with the tech giants and Internet companies that have entered the game, does Gudong Technology have an advantage in promoting the commercialization of hardware + AI?

Cui Haitao: AI + hardware is a habit, and hardware + AI is a gene. AI + hardware is more about superimposing functions on the original product, which is to increase the experience, but it cannot revolutionize the entire business format and become a phenomenal product. And hardware + AI has become a form for large model manufacturers to seek monetization and to seek business landing through the growth of new AI hardware.

Objectively speaking, hardware + AI requires enterprises to have a hardware gene. If you only do AI without going through the iterative trial and error of hardware, it is easy to fall into a pit. At present, the best way for large factories is to replicate the Baidu speaker case, use their own advantages of AI large models, and cooperate with hardware manufacturers to present new products.

The hardware difficulty of AR glasses is very high. In order to ensure the portability and comfort of the product, the internal space of the device is limited, which will limit the battery capacity. At the same time, AR glasses require a powerful computing chip to support complex computing, and there are also requirements for the power consumption and heat dissipation of the device. If the enterprise itself does not have the corresponding accumulation and wants to follow the market trend to make an AR product, it is very difficult.

Gudong Technology not only has experience in the whole machine manufacturing, but also has accumulation in AR optical display and materials. The self - developed third - generation display photoresist material has broken through the technical restrictions of foreign countries, and the indicators are leading among international top material manufacturers. Therefore, Gudong Technology has the ability to provide the base and vertical model, and can be landed in the real scene through hardware.

Yingke: Google has led the AR industry to rise and fall, and various stories have emerged one after another. What story has Gudong Technology told?

Cui Haitao: Frankly speaking, there are already enough stories in the industry, and what Gudong Technology needs to do is to be de - storified.

If AR glasses want to be landed, what must be considered is the value of the product itself, rather than forcibly binding the AR technology concept. Especially for B - end customers, they emphasize the practicality of the product, looking at the cost and the benefit. Stories will only create a huge gap between the demand and the reality, which is not conducive to the landing of the product.

How to be de - storified is to solve the pain points of customers.

Gudong Technology applies AR to specific scenarios such as maintenance, inspection, assembly, after - sales, exhibition, practical training, warehousing, and digital sand table in response to the needs of the industrial scene. The most intuitive is the reuse of historical data. Through the AI algorithm to identify the machine model, inspection requirements and maintenance steps, to provide guidance for the staff. For example, in the production process of lithium batteries, the operating data of the equipment can be displayed in real time through AR glasses to help engineers quickly detect problems and adjust process parameters.

The AR Glasses Have Not Reached the Explosion Period

Yingke: Everyone in the industry is saying that VR and AR are back on the stage and will become the next "mobile phone". How long do you think it will be before the real explosion of the AR industry? What does the industry and the market need to prepare?

Cui Haitao: It is too early to talk about the explosion period. The industry is currently in the mid - term, and there are still many technical problems that need to be overcome.

The AR industry chain is mainly centered on optical display, perceptual interaction, main control chip, etc. The most difficult to breakthrough is the optical display, which is also the focus of Gudong Technology's research. Simply put, we need to achieve a super - large color screen on the lens, which must ensure high transmittance and low energy consumption.

Gudong Technology has launched arrayed optical waveguide and volume holographic optical products, filling the technical gap in the industry with non - optical machine optical waveguide display and hybrid high - efficiency large - field - of - view display. In addition to the advantage of being lightweight, the arrayed optical waveguide has a better imaging effect than the mass - produced SRG, with a transmittance of more than 90% and low light loss, reducing the energy consumption of the optical machine and increasing the battery life.

However, there is no absolutely perfect technical solution in the market. Even though Gudong Technology is already leading the industry in transmittance, the high cost of a single lens, and the technical contradiction between high computing power and long battery life have not yet been solved. These are precisely the keys to determining whether AR glasses can achieve explosive growth.

Yingke: Who are Gudong Technology's competitors?

Cui Haitao: In the B - end market, there are Microsoft abroad, and Liangliang Vision, Liangfengtai, and Rokid in China. However, the above - mentioned enterprises have transformed their business focuses - either to the C - end or to software. Therefore, Gudong Technology basically remains at the top of the B - end market. And with the continuous improvement of the customer's repeat purchase rate, it is difficult for other competitors to enter the market and break the balance.

Yingke: In the past two years, the number of industry players has increased. Will you feel anxious because of competitors?

Cui Haitao: Frankly speaking, I feel both anxious and excited. I am anxious about tech giants such as Meta, Google, Apple, and Huawei. Their rapid intervention has accelerated the product iteration speed and made the market's scrutiny of products more stringent; I am excited that the AR industry has many tech giants, Internet giants, and traditional eyewear manufacturers, which can take the industry to a new level.

When AR comes to the fore, Gudong Technology's opportunity has also come. The technical accumulation of software and hardware can enable us to keep up with the trend and show more pragmatic applications and more affordable products to the outside world.

In the Future, There Is No Distinction Between B - End and C - End in AR Glasses

Yingke: In the field of AR glasses, who do you think is the mainstream of future development, the B - end or the C - end?

Cui Haitao: Personally, I think there is no very clear boundary between the B - end and the C - end in the future, because the users of AR glasses are workers when they are at work and consumers after work. If considering portability, the future AR glasses should be able to solve more scene experiences.

And, the volume of the B - end market and the C - end market will not be much different. Here is a very futuristic scenario. In the future, you may not be able to leave the assistance of AR smart glasses when you go to work. You need it as your external brain - computer interface to connect to the factory, process data, and manage processes. And with the popularity of AR glasses in daily consumption, it will definitely make B - end enterprise decision - makers see the improvement of enterprise efficiency brought by AR glasses.

Yingke: Does Gudong Technology consider exploring any new application scenarios in the future? Are there any plans for new products?

Cui Haitao: We are exploring scenarios such as outdoor sports, payment, cultural tourism and education.

Recently, Gudong Technology released two new products, AI + AR glasses - Star1 and Star1S. This is the first time that Gudong Technology has transitioned from the industrial metaverse to the consumer field. The two glasses are for a wider range of application scenarios and are more suitable for C - end users.

Yingke: In the past two years, many companies have been studying going overseas. Does Gudong Technology currently have plans to go overseas? What are the key points of Gudong Technology's overseas strategy.

Cui Haitao: For the overseas market, we have only done market tests so far, and the overall purchase intention is high, and the profit margin will also be considerable. Gudong Technology's advantages in optical display can also support more overseas brand manufacturers to quickly output products and occupy the market.

Most overseas manufacturers focus on establishing C - end brands and quickly distributing products through overseas e - commerce channels. Therefore, Gudong Technology's overseas focus