“Apple’s Mixed Reality Headset: Can It Revive the AR/VR Industry?”
Introduction:
Virtual reality startups are waiting for Apple’s much-anticipated mixed reality headset release, which is expected to become a catalyst for an industry funding rebound. While augmented reality and virtual reality technology have experienced a decline, Apple’s upcoming product launch is stirring excitement and hopes of a potential revival. In this article, we will explore Apple’s mixed reality headset, the state of the AR/VR industry, and its potential implications.
Apple’s Mixed Reality Headset:
Apple is expected to unveil its mixed reality headset, which will combine augmented reality and virtual reality features at a price point of about $3,000. Industry experts speculate that the headset will have a new App Store, fueling predictions of rapid revenue growth once Apple validates the technology with its own hardware. In doing so, Apple’s mixed reality headset could pave the way for other companies to benefit from the creation of services for headphones. However, as with any major hardware launch, there are fears that Apple’s “walled garden” could dominate certain areas and shut out the competition.
State of the AR/VR Industry:
Recent developments in AI chatbots have deflated the hype around AR/VR technology that was once seen as the industry’s “next big thing.” This has caused venture capital investments in augmented reality and virtual reality companies to plummet by 74% to $800 million in the six months to March, compared to the same period a year earlier. The focus has shifted to generative AI, while Metaverse, a term that once attracted funding, has become less popular.
Implications:
Apple’s mixed reality headset could reignite the AR/VR industry, allowing for investments in hardware, software, tools, and applications. While it is concerning that the industry is pinning its hopes on this announcement, the highly anticipated launch of Apple’s mixed reality headset is expected to be an incredible catalyst. Experts suggest that Apple’s approach to mixed reality technology could become a $1 billion market, similar to the company’s App Store for mobile devices that launched in 2008, which generates at least $70 billion of sales annually.
Additional Piece:
Despite the decline in the AR/VR industry due to a shift in focus towards AI technology, the development of mixed reality presents potential benefits for various sectors, including healthcare, education, and gaming, among others. Below are some examples of how mixed reality technology could be applied in different fields.
Healthcare:
Mixed reality technology provides an immersive experience for medical professionals, allowing them to enter a virtual environment and interact with medical data during surgeries or other procedures. Physicians can also use mixed reality technology to train students, improve diagnoses, and treatment planning. It can help patients to understand their medical condition and treatment visually, enhancing their experience.
Education:
Mixed reality technology can provide an innovative approach to education, allowing students to visualize and interact with concepts in a more engaging way. For example, mixed reality can create virtual science labs, allowing students to perform experiments and observe phenomena without the need for a physical lab. Virtual reality technology also helps students learn by experiencing historical events in a realistic manner.
Gaming:
Gaming is perhaps the most obvious industry that could benefit immensely from mixed reality technology. Games that incorporate mixed reality can provide immersive experiences like no other, offering players a chance to be fully immersed in the game’s environment. For example, a game like Pokémon Go brought augmented reality to the mainstream and changed how we approached mobile games. With the introduction of mixed reality, gaming experiences could continue to evolve.
Summary:
Apple’s release of a mixed reality headset is poised to revive the AR/VR industry. While augmented reality and virtual reality technology have experienced a decline in investment, the excitement surrounding Apple’s upcoming product launch has reignited hopes for a potential industry upturn. In addition to industry implications, mixed reality technology presents numerous opportunities for sectors such as healthcare, education, and gaming, to name a few. Overall, the potential for mixed reality is vast and could shape the future of various industries while providing users with experiences that were once unimaginable.
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Virtual reality startups have pinned their hopes on Apple’s long-awaited release of a mixed reality headset, becoming a catalyst for an industry funding rebound.
Expectation is growing that the iPhone maker will host its biggest hardware launch since the iPad in 2010 at its annual developer conference on Monday. The headset, likely priced at around $3,000, is expected to combine augmented reality, which conjures digital images in the real world and virtual reality, which immerses users in a game-like realm.
“Encoding new worlds,” reads Apple’s website for Monday’s event, which many interpret as a reference to a new computing platform.
Tipatat Chennavasin, co-founder of the Venture Reality Fund, said he expected the Apple headsets to include a new App Store, “the next ecosystem where millions of developers are making millions of dollars selling to billions of people.”
He added that startups have been showing potential investors “hockey stick” charts for years to predict rapid revenue growth once Apple validates the technology with its own hardware.
“I’ve seen people pledge the Apple device in their pitch decks for about six years,” said Chennavasin, whose fund has backed 50 companies in the industry since 2016. It has reached “the fever pitch,” he said.
Hype that AR/VR technology writes the industry’s “next big thing” over the past six months has been deflated by the release of AI tools driven by ChatGPT, the OpenAI-backed chatbot that provides human answers to questions.
The frenzy for AR/VR technology was so great in late 2021 that Facebook changed its name to Meta, signaling belief in an avatar-filled “metaverse” that the company is spending $10 billion a year to develop .
The fanfare accompanying Apple’s eagerly-anticipated launch prompted Meta this week to chime in with a show of Quest 3, its latest virtual reality device. CEO Mark Zuckerberg called it “Meta’s most powerful headset.” It will go on sale this fall for $499.
But interest has waned as the focus has shifted from AR/VR to generative AI. Venture capital investments in augmented reality and virtual reality companies plunged 74% to $800 million in the six months to March, compared to the same period a year earlier, according to data from PitchBook.
“Metaverse is no longer a term that anyone wants to use to get funding,” said Tuong Nguyen, an analyst at Gartner. “But there’s this idea that Apple can turn the tide for all boats.”
Ori Inbar, founder of Super Ventures, an early-stage augmented reality fund, acknowledged that “things have been progressing at a much slower pace than we all expected.” The Apple event, however, is likely to be an “amazing” catalyst for “moving forward all investments in hardware, software, tools and applications,” he added.
However, Inbar is concerned that the entire industry is pinning its hopes on this announcement.
Morale in the industry has been “pretty low” recently, said Inga Petryaevskaya, managing director of ShapesXR, a collaborative VR modeling app.
“People are struggling to raise funds, businesses are slowing down their investments in mixed reality, and Meta has been making several rounds of layoffs,” Petryaevskaya said. “We have already passed several VR winters, but we need to show investors that we are approaching 100 million headsets, not just 10 or 20 million, so they can understand our growth potential. But right now it’s hard to show.
The hope is that Apple’s latest device will once again allow other companies to benefit from the creation of services for headphones.
Apple’s App Store for mobile devices, launched in 2008, generated $30 million in sales in its first month. The late founder of the tech company, Steve Jobs, said: “Who knows, maybe sooner or later it will become a $1 billion market.” Today, annual App Store sales total at least $70 billion, and advertising revenue is even higher.
Unlike any other company, Apple could rejuvenate the industry by lighting the way for others to follow, said Venture Reality Fund’s Chennavasin. But, he cautioned, there were also fears that, with its partially enclosed “walled garden” approach, Apple could dominate some areas and shut out the competition.
Additional reporting by George Hammond in San Francisco
https://www.ft.com/content/c0b4d04c-23c5-452e-88ca-9226bd37a732
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