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Apple Inc. executives avoided using the term “metaverse” when introducing their new headset Monday, but the Vision Pro device could still provide a boost to Meta Platforms Inc. Chief Executive Mark Zuckerberg’s push into augmented realities.
The announcement of the Vision Pro high-tech goggles during the keynote address at Apple’s WWDC conference is the type of high-profile, game-changing event that could kick-start virtual computing after years of false starts and unfulfilled promises. In affirming the concept of virtual and augmented reality, Apple
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might help Meta
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establish itself as the alternative, much as Alphabet Inc.’s
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Android is the alternative to iOS in mobile phones.
Android is not the only possible metaphor for Meta, though. The now-dominant company in virtual-reality headsets could instead be the next BlackBerry
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the once-popular mobile device that was flattened by the introduction of iPhone in 2007. Just as the iPhone made BlackBerry’s physical keyboard and clickwheel feel instantly dated, the presentation by Apple executives Monday showcased mixed-reality capabilities that far exceed what Meta has offered so far. It also featured direct digs at the current devices, pointing out, for instance, that Vision Pro doesn’t require “clumsy hardware controllers.”
“Augmented reality is a profound technology … Apple Vision Pro introduces us to spatial technology,” Apple Chief Executive Tim Cook said, using Apple’s preferred terminology for the tech, which Cook said was “years in the making.” The focus of the product is content and enterprise use, rather than gaming, and it comes at a steep price, costing $3,500. It will not be available until 2024.
“There are certain products that shift technology and how we use it,” Cook added, catapulting Vision Pro into the same rarefied air as the iPhone and iPad.
Meta, meanwhile, has leaned into gaming as a primary reason to buy its Meta Quest headsets, which cost significantly less. Even Meta’s top-of-the-line Quest Pro headset costs less than half what it did when it was introduced, after Meta quickly slashed its price amid a dearth of interest.
Facebook’s corporate name change led to fevered hype about the metaverse in 2020-21, but the excitement didn’t last. Overall shipments of AR/VR devices plunged more than 50% in the latest quarter amid economic pressures and a general cooling of interest, according to IDC, and investors have criticized Facebook Reality Labs, the Meta division that hemorrhaged billions of dollars on metaverse development.
Some financial analysts, however, believe Apple’s entry into the category could turn the trajectory of Meta’s metaverse play around.
Apple’s new headset could “help shift sentiment from ‘Meta is incinerating cash in VR’ to ‘we may have something here,’ given how far in front the company is vs. the field,” Barclays analyst Ross Sandler said in a note Friday.
“Because the [virtual reality] market is so new and so early, it will have a net positive for the next five years,” Gartner analyst Tuong Nguyen said in an interview. “Apple is validating the market, and there will be plenty of space for everyone.”
Read more: Apple’s stock at all-time highs ahead of WWDC, headset reveal
Facebook bet its future on the metaverse, only to see the concept languish amid consumer indifference and a shift by the technology industry to artificial intelligence. But over the course of the last several weeks, Meta has recast its strategic narrative, intertwining the co-dependence of AI and the metaverse. Underscoring its point, company representatives have emphasized that the metaverse vision is a long-term one.
On Friday, Meta pre-emptively announced its next-generation virtual- and mixed-reality headset, Quest 3, based on Meta Reality technology. It will be available in the fall, starting at $500. The high-end Quest Pro headsets have not sold well, although consumers have plunked down more than $1.5 billion on apps and games in Meta’s Quest app store. Games from Roblox Corp.
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and Epic Games Inc. have proved to be popular.
Last month, Meta jumped into the AI sandbox with a set of new AI-powered tools and services it calls a “testing playground” for advertisers.
Read more: Meta climbs into ‘AI sandbox’ with tools for advertisers
“The metaverse — just like our feed ranking — will be powered by advanced AI technology. As Mark [Zuckerberg] has said, we’re focused on two waves of technology: AI and metaverse. They build on each other,” Nicola Mendelsohn, head of the global business group at Meta, said last month at a briefing for journalists. “There’s been a thing out there that we aren’t interested in the metaverse anymore. We are really interested in the metaverse. But we’re also really clear that this whole thing is going to be five, 10 years before it really realizes the vision of what we’re talking about.”
Yet the re-emergence of the metaverse and its possibilities — whether from Apple, Meta, Google or Microsoft Corp.
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— elicits a feeling of déjà vu among industry analysts who have witnessed waves of hype for virtual reality and related efforts over the course of decades but have never seen the promised success of the technology.
“Ah, the metaverse — here we go again. The highly rumored, much-anticipated super-expensive meta blah blah,” analyst Maribel Lopez said in an interview.
Indeed, the excitement that built after Meta’s pivot seems to have faded. Along with the decline in headset shipments, metaverse-related startups, which raised $2.93 billion in venture capital in the first five months of 2022, saw a dramatic drop-off to $664 million in the same period of 2023, according to PitchBook. Large companies that appeared excited by the possibilities have changed direction. Microsoft and Walt Disney Co.
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have recently trimmed metaverse and mixed-reality operations.
All that can change again, though. Disney CEO Robert Iger lent his support at Apple’s event Monday and said Disney+ will be available on Vision Pro when it launches. Apple showed off Vision Pro’s ability to reproduce 3-D movies with Disney’s “Avatar: The Way of Water,” and a Disney video showcased other potential experiences.
Any excitement for the future failed to show in stocks’ movement, however: Meta’s stock ended the day down 0.5%, and Apple shares ended down on the day after topping all-time intraday highs before the keynote address began.
