As Meta faces a financial reckoning over its investment into its metaverse-moonshot, Apple is gearing up to release a competitor to the Quest 2 and Quest Pro virtual reality headsets. DigiTimes Asia and MacRumors report that Apple’s offering will be an “extended reality” headset that combines virtual, augmented, and mixed reality. It is likely set to start production in March 2023.
Sources told DigiTimes Asia that Apple’s XR headset “targets the commercial markets,” which is bad news for Meta as the company has spent years trying to make its VR headset a sought-after consumer product. In some ways, however, Meta has succeeded in achieving that goal: In June, analyst company International Data Corporation estimated that the company had sold 15 million units of its Quest 2 headset, which currently retails at a starting price of $399. But the company’s most recent release, the $1,499 Meta Quest Pro, has not been met with especially positive reception.
This week, Meta announced it would be laying off 11,000 people, or 13% of its staff, as a result of misguided investment in its metaverse product line.
Once Apple steps into the ring, the VR market may reach a new echelon of public interest. Apple’s brand power and deep consumer trust may transform VR headsets into the kind of must-have accessory that regular consumers feel compelled and convinced to buy.
Can Apple do for virtual reality what it did for smartphones? As a bullish VR proponent, I certainly hope so.
That said, Apple’s headset will come with the usual “Apple tax” — the device is projected to retail for more than $2,000 — and could be limited to less than 1 million units. DigiTimes Asia notes that “for supply chain manufacturers that benefit from quantity, this is not a particularly profitable order.” But the collaboration will likely lead to lucrative, longer-term contracts with Apple as the company builds out its AR and VR offerings. Taiwanese electronics manufacturer Pegatron, which has worked with Apple and Tesla, is said to be the exclusive partner for the final assembly of those units.
Based on this latest report, it sounds like Apple is in the VR game for the long haul. So if Meta wants to compete, it’ll need more solid “legs” to stand on.
