Augmented reality has long been the fascination of sci-fi predictions. However, the potential is now very real, such that augmented reality applications are being developed that fundamentally disrupt our traditional interactions with technology. Consumers and businesses alike are being offered solutions that fundamentally change the customer experience or reshape business processes.

So what is augmented reality?

There is some debate over exactly what augmented reality means. For the purposes of this article, we will take "augmented reality" to mean the overlaying of digital text or pictures (such as the distance to a nearby coffee shop, or perhaps even a friendly neighbourhood Pokemon) on top of an existing environment.

Augmented reality in this sense is often implemented via the rear-facing cameras of our smartphones and tablets, though this is not the only way; the Google Glass pilot was also a sophisticated version of an augmented reality tool. In most cases, users view their immediate environment through their smartphone from within an augmented reality app, and the app overlays directions to the coffee shop (or Pokemon, as the case may be).

In business and industry, the possibilities are endless, with in-field data, tutorials and shared working all potentially facilitated by augmented reality applications.

If this still doesn't make things clear – augmented reality is a bit like Arnold Schwarzenegger's "augmented" world view in the Terminator films!

A litigation nightmare?

Whilst augmented reality directed at the consumer has been around for a while (Trip Advisor had a reasonably significant stab at implementing augmented reality in 2011), the legal standards expected of those producing and using augmented reality solutions are yet to become clear.

To take an example, would it be reasonable to sue an augmented reality application developer if the coffee shop you were directed to by the app never existed? Does the answer to this question change if the coffee shop does exist, but despite its "5 star" rating, the barista scalded the milk of your latte? Or if you absent mindedly bump into a lamppost when chasing a rare PokemonGo character? We suspect not.

The position is likely to be different, however, should a visually impaired person rely on the incorrect instructions of an augmented reality style app that is designed to say whether it is safe to cross the road. There are now several well-publicised incidents of users of augmented reality apps suffering personal injury and the position of responsibility of app operators will become clearer as the law catches up.

Risks of infringement of intellectual property rights

Enabling end-users to contribute to the augmented reality experiences of others could also prove problematic; uploading photos of a recent play to be displayed when other users of the same app walk past a theatre could, for example, infringe the performers' intellectual property rights.

That said, the app users themselves are not the only source of potential liability for developers of augmented reality apps. Leaving US-style patent infringement to one side, augmented reality apps overlaying the logos of recognisable brands may in some cases go far beyond "fair use", and lead to copyright or trade mark infringement claims.

Looking at this from another angle, if an error caused by a sub-contractor who coded a small part of an augmented reality app ultimately leads to an end-user hurting themselves, is there sufficient provision in the contract to ensure the sub-contractor is "on the hook" for that mistake?

Cyber security

The law has never proved particularly proficient at keeping up with changes in technology, and the technical aspects of augmented reality pose particular challenges.

In particular, augmented reality is not just limited to mobile phones and tablets. Plenty of guides already exist online from the "augmented reality movement" explaining to users how to hack Microsoft's Kinect sensor. It is not inconceivable that similar guides start to appear in the future on how to hack a car's augmented reality system, causing the system to overlay incorrect speed information, or send the driver the wrong way up a one way street.

How far should developers be expected to go in terms of making their systems secure? It seems to me that the law is likely to expect a higher standard of care from apps selling themselves as being suitable for a particular purpose, much in the same way as the law currently responds to those holding themselves out as "professionals" or specialists in a particular area.

Similarly, AR apps will be designed to generate and process a wealth of user data based on their habits, locations and use of the AR app generally including location data, automated decision making and profiling. Data protection laws and regulations will require that best practice is adopted in storing and processing such data. Operators should note that General Data Protection Regulation 2016 comes into effect on 25 May 2018. The 2016 regulations across the European Economic Area replacing current national legislation and imposing even stricter requirements and higher consequences for breach.

The future

As people continue to fall into ditches, crash into trees and sprain their ankles playing Pokemon Go (or, indeed, the next augmented reality based whirlwind success), the legal standards expected of augmented reality developers, as well as the "common sense" requirements expected of augmented reality app users, should become clearer. No doubt the next few years will see some interesting case law!