Source: Wall Street News
Author: Du Yu
Executives at tech giant Apple showed off a mixed-reality headset to the company’s board of directors last week, according to multiple people familiar with the matter, in a sign that development of the device is in an advanced stage. In recent weeks, Apple has also accelerated development of the rOS operating system that runs on the headset, which seems to mean that the device will be officially announced as soon as the next few months.
The report said the “mixed reality” headset, which combines virtual reality (VR) and augmented reality (AR), is expected to be the company’s next most important new product since the launch of the Apple Watch in 2015. Apple can use this to expand its hardware device business, which contributes 80% of its annual sales, to the emerging field of mixed reality headsets, which is still in its infancy.
Apple’s stock price maintained a decline of more than 2% in midday trading on Thursday, falling for two consecutive days to the lowest since July 2021. This year, it has fallen more than 22%, and has fallen nearly 25% from a new 52-week high, deep in a technical bear market.
According to 9to5mac, a technology website that focuses on Apple’s related information reports, although Apple has not officially confirmed the existence of the AR/VR headset project, this internal code-named N301 product has been developed since around 2015, and it has almost become an industry “” open secret”.
About 2,000 Technology Development Group (TDG) employees are involved. Apple VP Mike Rockwell led the project, with former hardware engineering chief Dan Riccio also overseeing it. In addition to key hires from NASA and the gaming, graphics and audio industries, the project team includes former hardware and software engineering leaders for iPhone, iPad and Mac.
Based on information from all parties, this mixed reality headset will be equipped with an advanced processor equivalent to the self-developed chip M1 used in the latest version of Mac computers, as well as an ultra-high-resolution screen. The self-developed chip will become one of the main differences between Apple and its competitors in the same device. The display adopts an “innovative three-display configuration”, consisting of two Micro OLED displays and an AMOLED panel, and will be equipped with more than ten Sensors, including cameras, for advanced features such as environment and gesture detection.
Although new product development has become “an open secret,” the timeline for when the headset, which pioneered Apple’s new product category, will be “officially announced” and sold to the public remains unclear.
Bloomberg previously reported that Apple originally planned to officially announce and introduce the device at the company’s WWDC Worldwide Developers Conference in June, but technical challenges such as the content and overheating of the device could lead to a delay in the release. It is widely believed that Apple will make an “official announcement” at some point between the fall of 2022 and the summer of 2023, and that it will officially sell to consumers in 2023.
Today’s update on “Apple showing the headset to the board” seems to confirm the timing. Apple’s board of directors, made up of eight independent directors and CEO Cook, meets at least four times a year. By convention, Apple’s boards often see future new products before the public, such as the 2011 Siri intelligent voice assistant, which was shown to the board a few weeks before its release.
At the same time, when Apple released smartwatches and HomePod smart speakers in the past, they chose to make an “official announcement” later in the year before they went on sale, and started selling new products early the following year. Some analysts speculate that perhaps Apple will adopt the same strategy, that is, “official announcement” in late 2022 and foreshadowing of the upcoming launch of the headset, followed by sales in early 2023.
In any case, the consensus on Wall Street is that 2023 is a “certainty” for the device to go on sale and that the price will be “well above $1,000,” with a likely range of $2,000 to $3,000, indicating that the device’s initial primary audience is iron Fans, enthusiasts, early adopters and developer communities, not the general public. Apple last year expected to sell about one per retail store a day.
Ming-Chi Kuo of Tianfeng International Securities, who is keen to release new product forecasts and is known as the “strongest Apple analyst on the surface”, said in December last year that the upcoming mixed reality headset is “the first generation”. Weighing about 300 to 400 grams, it has a clear advantage over existing VR headsets on the market. But Apple is “already working on a design for a second-generation headset,” which will be lighter, with an updated industrial design, a new battery system, and a faster processor.
He expects Apple to sell about 2.5 million to 3.5 million first-generation headsets in 2023, with a second-generation launch sometime in the second half of 2024, with new features and friendlier prices expected to accelerate demand growth , the second-generation device could sell nearly 10 million units. Earlier analysis said that this will benefit Sony, Will Semiconductor, Sunny Optical and other component suppliers.
Another “open secret” in the industry is that what Apple wants to do most in the future is not this mixed reality headset, but an independent and thin AR virtual reality glasses. This device is also already in development, internally codenamed N421, and is expected to launch in the late 2020s, even though it will be several years before the technology matures to achieve this ultimate goal.
In fact, Apple’s development of this headset device has not been smooth sailing, as can be seen from the delay in the release of this device. It is reported that Apple originally planned to release the headset in 2019 and officially go on sale in 2020. Then it was changed to “official announcement” in 2021 and listed in 2022. As a result, it seems that it can only be seen on the market in 2023 at the earliest.
The Information, a paid-for subscription tech news outlet in Silicon Valley, published a blockbuster piece this week, saying it spoke with 10 people close to the project, most of whom work in teams. The report said that the biggest challenges encountered by mixed reality headsets are technical. In addition to the difficulty of finding compelling applications and content, other technical obstacles include overheating of the device and improving cameras and sensors. What’s more, the company’s top management was not fully committed and disagreed with the product idea, creating a lot of resistance.
For example, even though the company’s board of directors in 2016 agreed to approve more development funding after an initial experience with a prototype, CEO Cook wasn’t as deeply involved in the creation of the headset as Jobs was when he was developing the iPhone, such as he rarely traveled within a few miles of Apple’s California headquarters. outside the headset development team’s office. The lack of strong support at the top makes it difficult for headsets to compete with Macs and iPhones for engineer resources.
The headset team also encountered opposition from former Apple chief designer Jony Ive, who left in 2019. The latter initially refused to build a pure VR virtual reality headset because of concerns that VR would isolate users from the outside world and make users Alienation from other people and lack of practical use. Apple’s industrial designers also don’t believe there will be consumers willing to wear an invasive headset for extended periods of time. Jony Ive also objected to wirelessly networking the headset with a “processing base station” in the user’s home to make it more powerful, supporting only one “standalone” device.
It is reported that Apple’s internal final solution is to propose adding cameras to the front of the headset so that the person wearing the device can see the surrounding environment, and adding an “external-facing screen” to the headset to show other people. Video images of the eyes and facial expressions of the wearer of the device, allowing the user to interact and collaborate with others. The internal code name of the “outward-facing display” development is T429.
There are also reports that Apple initially entered the mixed reality headset track mainly because it felt the pressure from the “metaverse” Meta. After the official launch of the headset, Apple will strengthen its competition with other technology giants, including Meta, Sony, Microsoft and Google. And compared to the VR-loving Meta, Apple seems to be leaning more toward the idea of AR, which is tightly connected to the real world.
At present, Meta and Google are also developing future independent AR glasses like Apple. Meta also plans to launch a mixed reality headset similar to Apple’s new product in the next few months. The product code-named Project Cambria will sell for above $800.
According to IDC, the global AR and VR headset market grew by 92% year-on-year last year, with more than 11 million units sold. Of these, Meta’s Quest 2 headset currently dominates the market, accounting for about 78% of total sales in 2021. Analysts believe that with its marketing strength and product ecosystem, Apple’s entry into this track will continue to expand sales in this industry.
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