Tim Cook arrives at the Vanity Fair Oscar Party during the 94th Academy Awards in Beverly Hills, California, US, March 28, 2022. REUTERS/Danny Molochuk

Apple’s VR headset should be a success — for itself and the VR industry

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Apple’s VR headset has been their hottest product for years

Apple (AAPL) will host its annual WWDC Developer Conference live from its headquarters in Cupertino, California on June 6.

While there’s sure to be plenty of announcements and demos, including our first look at iOS 16, watchOS 9, and the latest version of macOS, the most anticipated product might not even appear: Apple’s augmented and virtual reality platform.

The software, called Virtual Reality OS, is said to provide the basis for Apple’s future plans for virtual and augmented reality, not to mention give developers the opportunity to start building apps for the platform.

Apple has a lot of riding on VR and AR products. The platform will mark the company’s first major product launch since it debuted the Apple Watch in 2015, and usher in its latest craze in Silicon Valley: the metaverse. More importantly, it may finally give Apple the successor to the iPhone it’s been chasing for years.

But if the headset and associated software flop out of the gate, it will deal a huge blow to the broader VR industry that looks to Apple as a catalyst to launch the technology into the mainstream.

Apple CEO Tim Cook will have to oversee the successful launch of the Apple AR/VR headset. Photograph: Danny Molochuk/Reuters

“Augmented reality needs Apple to succeed,” Jane Munster, managing partner of Loup Ventures, told Yahoo Finance.

“It would be a missed opportunity, because I think there is a lot that can be unlocked with AR in the long run. But the risk is that [Apple] Imbalances and industry never work.”

Apple’s RealOS is the next main interface

There’s no guarantee that Apple will reveal the augmented reality system at WWDC, but if the software or hardware makes its debut this year, there’s no better place than Apple’s biggest show.

On Saturday, Vox’s Parker Ortolani discovered a trademark app for Apple’s suspected AR and VR operating system: Reality. And although it was not registered with Apple, there is a possibility that its registered company, Realityo Systems LLC, is a shell company of the iPhone maker. Corporations are often used by large corporations to help hide their most secretive products.

Apple isn’t the only company pouring money into AR/VR and the metaverse. Meta (FB), Facebook’s parent company, spent more than $10 billion on its AR and VR efforts in 2021 alone. The social networking giant hopes that by building its own hardware and software for the metaverse, it will no longer have to abide by Apple’s App Store rules.

“This is a big deal,” Munster said. “That’s why Facebook spends so much money on Reality Labs because they know what’s at stake. It’s the next OS. It’s the next front, and they don’t want to be accountable to Apple.”

While Apple is clearly working on its own headphones, it remains unclear how exactly the company will market its devices. According to Tuong Nguyen, Senior Principal Analyst at Gartner, the Apple headset is likely a purpose-built device rather than an all-in-one product.

Think about how well the Apple Watch does some things, like tracking your workouts and eavesdropping on quick messages, while the iPhone does everything so well. No matter how Apple markets its headphones and software, a solid launch will be critical to ensuring that Apple’s AR and VR efforts don’t fade away completely.

“You only have one chance to get that right out of the gates, and Cupertino is focused on this major product initiative,” Wedbush analyst Dan Ives told Yahoo Finance. “There is a lot of complexity with the launch of the next Apple product which will eventually be [10 million to 15 million] Units likely to appear at first product launch.”

The industry counts on Apple

Whether we get Apple’s AR/VR headset at WWDC or sometime next year, the broader industry depends on Apple’s success.

“They wouldn’t want to admit this, but [Apple has] “He’s got to do the heavy lifting to get the industry off the ground,” Munster said.

According to research firm IDC, the global market for AR and VR headsets in 2021 grew 92.1% year on year to 11.2 million units.

However, this figure is not comparable, for example, to the global smartwatch market, which, according to Counterpoint Research, shipped 40 million units in the fourth quarter of 2021 alone.

Meta Quest 2, all-in-one VR headset, touch controllers and bag on display in Costco, Queens, NY.  (Photo: Lindsey Nicholson/UCG/Universal Images Group via Getty Images)

Meta Quest 2, all-in-one VR headset, touch controllers and bag on display in Costco, Queens, NY. (Photo: Lindsey Nicholson/UCG/Universal Images Group via Getty Images)

However, Apple’s branded headphones can boost sales in the wider industry. Need a guide? Look no further than the impact that Apple’s presence has had on smartphones, smartwatches, and wireless earbuds sales.

As it stands, the AR and VR industry, not to mention the metaverse, is a far cry from the phenomenal success investors and manufacturers have been talking about in product displays and presentations.

Even Epic Games VP and General Manager of Unreal Engine Mark Pettit told Yahoo Finance that consumers have already lost interest in metaverses. Meanwhile, Munster says consumers don’t want anything to do with technology as it currently exists.

Apple and its army of loyal developers can change that, by providing really great use cases for AR/VR headsets other than playing a few games or watching movies on a pseudo-100-foot screen.

If the AR/VR and metaverse industries are ever to reach their potential, Apple will need its headset and software to be overwhelming. And if the headset fails, metaverse may end up as nothing more than an unfulfilled promise.

by Daniel Holly, technical editor at Yahoo Finance. follow him Tweet embed

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