"I think the same happens with augmented reality" apps, says Alex Makarov, head of development at SHAPE Services, a mobile app developer delivering iOS apps such as IM+ (free). "Proof-of-concept apps are looking cool, especially on Youtube. When you start to put these things in the real world, a bunch of problems arrive."

Augmented reality, or AR, burst on the mobile scene a couple of years ago to much fanfare--and fizzled shortly after. Basically, AR is the overlaying of information usually gleaned from the Internet onto a live image or video feed on a screen. Fans of the National Football League have been staring intently at AR on their television sets for years. It's the digitized yellow line on the football field indicating a first down.

Companies working hard in the AR space include Layar, Zugara and Total Immersion. Other app makers such as SHAPE Services are dabbling in the technology. SHAPE Services recently launched CheckIn+ (free), an iPhone app with built-in AR that lets you find places and check into them with Foursquare and Facebook Places. Another popular iPhone search app, AroundMe app (free), which made CIO.com's list of , also has AR features.

Part of what's holding AR back, though, is its murky definition. Let's say you're shopping at an electronics store and run across a pricey item. You whip out your iPhone and fire up the super-popular RedLaser (free) app. RedLaser scans the item's barcode using the iPhone camera and retrieves information about competitive pricing. Is this AR at work, too?

"In short, this is a technology that is not well understood," says Gartner analyst Van Baker, "and the value proposition is not immediately apparent until you see a specific implementation. Then people can react to the value they see."