Apple is rumored to release a VR headset at WWDC on 6/5/23. I am making some predictions about what the headset might offer, based on public information and my own speculation.
- These are my personal opinions. I am not speaking for Meta.
- My focus will be on the system software and content rather than hardware.
Principles for prediction
- Basis of competition: Apple will concentrate on areas where they excel, rather than venturing too far outside their strengths. Apple excels at leveraging and connecting their existing assets to further their consumer advantage.
- Past launches to predict future patterns. Apple has a playbook they have followed with the iPod (2001), iPhone (2007), and Apple Watch (2016) to bring devices mainstream. They are likely to borrow from this playbook when launching the headset.
- Apple’s AR/MR Patents. I examine the patents filed by Apple over the past few years. These patents provide breadcrumbs that showcase Apple’s exploration of augmented reality and mixed reality.
Quickly, let’s get the hardware speculation out of the way, as there has been ample speculation already.
- Sleek design, possibly featuring rounded edges :-)
- 4K (Retina?) resolution screens per eye. The display might be curved.
- Two-stage architecture, offloading compute and battery to a separate device clipped onto your belt or as a puck on your table.
- Wireless connectivity with Mac, iPhone, Apple Watch, and AirPods.
- A depth sensor and outward facing cameras for mixed reality
- Inward sensors to capture eye and facial expressions like Quest Pro
- Some sort of a physical dial that switches the headset from VR to MR modes. Apple will focus on the MR story at launch.
What do you think? Which predictions did I get wrong or miss?
I predict that Apple will position the headset as a device for entertainment and wellness/fitness features. Apple wont position the headset as gaming device. The headset will not have controllers, and it will be connected to a Mac or iPhone. The success of the headset will depend on innovative use cases discovered by developers. So, Apple will offer developers a way to extend their iOS or Mac apps to the headset, and to create custom apps for enterprise use cases and learning/training. Apple will launch a set of mixed reality extensions to their first-party apps to generate initial demand. If the headset is released (Apple headset has always been right around the corner!), it will not sell many units at first, but it will generate enthusiasm among founders and venture capitalists, triggering another hype cycle around augmented/mixed reality technologies
High confidence predictions
1. A new kind of screen
Apple is not going to compete in the HMD market. It is going to attempt to win the TV & entertainment markets
Apple never enters a market that isn’t significant in size and growing. For example:
- In 2000, the MP3 player market was estimated to have sold around 3.2 million units, but the recorded music industry revenue reached approximately $37.8 billion.
- The global cell phone industry was already established and growing when the iPhone launched in 2007. Around 1 billion mobile phones were sold worldwide in 2006.
- In 2014, smartwatch shipments were estimated to be between 4 to 6 million units globally. The overall watch market, including luxury and non-luxury segments, was valued at approximately $60 billion to $70 billion.
Guess which market is massive but not disrupted yet? The global TV market.
The global TV market saw approximately 220 million unit shipments and ~$200 billion in revenue in 2021, according to estimates by the Consumer Electronics Association (CEA). The CEA predicts that the market will reach 240 million unit shipments and $220 billion in revenue by 2025 with the rising demand for larger and higher-resolution TVs and increasing popularity of streaming services.
A good UHD/OLED/QLED TV costs ~$2K. Shelling out $3K for a better/different kind of entertainment device doesn’t sound crazy if you have money lying around.
Apple has the assets to compete here:
- Apple TV+ offers a diverse range of content, including 60 original shows and movies. It features coverage of Major League Soccer and Friday night baseball, providing sports enthusiasts with engaging live programming.
- Apple’s acquisition of NextVR in 2020 was a strategic move aimed at bolstering its presence in immersive entertainment. NextVR was known for its expertise in capturing and streaming live VR content, including sports events, music concerts, and other immersive experiences.
VR/MR devices can make entertainment 10X better (BTW entertainment is a major use case on the Meta Quest;watch NBA games courtside on Quest). Imagine the exhilarating experience of watching your favorite movies on a ginormous screen that seemingly floats in your living room.
You can choose to watch the latest Ted Lasso episode or you might find yourself on the sidelines, watching Roy Kent warm up. Ted Lasso might pop into your living room (greenscreen Ted Lasso and remove the alpha channel) and exchange words of encouragement or share a memorable moment.
2. Live a healthier life
The global digital fitness industry is expected to reach $103.4 billion by 2025, according to a report by Grand View Research. The industry is growing at a CAGR of 15.5% from 2020 to 2025. Apple already recognizes this opportunity and has been investing in the Watch and Apple Fitness+.
When the Apple watch launched, Apple pitched it to consumers and developers as a device that would “reinvent the way you work out, stay connected, and live a healthy life.” Apple highlighted the Watch’s fitness tracking features. The HMD is the next logical extension of this strategy.
VR/MR devices can make working out personalized and fun (BTW fitness is a major use case on the Meta Quest). Btw, check out this prototype on Quest Pro from Litesport. It already works. Now imagine this for Apple Fitness+ workouts.
Apple Fitness+ has over 3,000 workouts and meditations. The workouts cover a variety of activities, including HIIT, yoga, strength training, treadmill, cycling, rowing, dance, and mindful cooldown. And Apple has your health metrics and exercise trends from the Watch. As you workout, your Watch tracks your heart rate, calorie expenditure, and provides performance analytics as cues in mixed reality to help you monitor your progress. Wouldn’t you want to see your Apple rings float in your living room and fill up as you workout?
3. Apple wont position the headset as gaming device
The games ecosystem in the iPhone is vibrant but there is no natural strategic advantage in bringing mobile games to a headset. Sure, you can play your favorite games on a giant screen but it may not be compelling enough to justify purchasing the headset. Also this would mean competing with Quest 3 which has a better library and is more affordable. Apple won’t use this as the basis for competition.
4. Look ma, no controllers
When Apple entered the mobile market, one of its signature moves was ditching the qwerty keyboards that Nokia and Blackberry pioneered. The iphone’s touch-based interface with multi-touch gestures and a capacitive touchscreen changed the basis of competition by making interacting with the device effortless. I think Apple will repeat this play. A non-gaming XR headset can get away without controllers.
Apple also introduced a new set of gestures with the first iphone; taps, swipes, pinches, scrolls, double taps. I think Apple will introduce new gestures with this headset. Want more proof?
Apple filed a patent titled “Micro Gesture-Based Control of Head-Worn Devices”. These micro gestures could involve minute movements of the user’s fingers, hands, or even facial expressions.
The patent suggests the use of various sensors, such as cameras or depth sensors, to capture and interpret these gestures accurately. I am not convinced that computer vision has become precise enough for micro gestures to work well in all cases. So, I think Apple will augment this input mechanisms with
- The iphone! If you already have an iPhone, you might open the HMD app and use it as a controller for the HMD. The Proximity Sensor, Ambient Light Sensor, Accelerometer, Gyroscope from the iphone in your hand can all be used to provide inputs to experiences in HMD.
- Siri voice commands
- Eye/gaze based interactions (especially for hand off)
5. Authentication and Hand off will be seamless
I expect Apple to heavily emphasize this convenience.
Using biometric authentication (either via the phone or eye sensors in the HMD) and the “hand-off” feature in Apple’s devices, Apple will attempt to simplify authentication and continuity of user workflows between the headset and the phone/computer
Handoff already combines Bluetooth Low Energy, iCloud Keychain, and cryptographic protocols to share passwords between Apple devices already. Apple will extend this to the HMD.
Need proof? Apple filed a patent for “Multi-device continuity for use with extended reality systems”.
An example use case would be that the technology lets you start creating or editing a document on one device, such as an iPad. You can then transfer that document to a MacBook or iPhone and pick up where you left off. With a headset, the process essentially involves looking at the device to initiate the transfer to the HMD.
6. Apple will emphasize value to developers because it needs it to find critical use cases to justify the rumored $3K price point.
I believe Apple will replay the Watch playbook. Apple starts by offering a broader range of experiences and creating devices that are relevant in multiple domains before settling in on one key thing for subsequent versions. For the Watch Apple tried a bunch of things (remember double tapping emojis to send to imessage contacts?) before settling in on health and fitness.
To go on this discovery journey, they will need different kinds of developer experiences and hence developers will be a critical part of their messaging. I think they will focus on 2 developer facing messages:
- Extend your iOS/Mac app to the headset
When Apple launched the Apple Watch, the developer pitch centered around the idea of extending the iPhone experience to the user’s wrist. Developers were encouraged to leverage the watch’s features and sensors (Digital Crown, Force Touch, and the Taptic Engine) to provide quick, contextual, and relevant information on the user’s wrist and provide quick ways for users to respond or take action.
Replace the wrist with face. Replace the crown/taptic with infinite screen real estate and micro gestures. I think Apple will offer a set of new developer functions via a rebranded ARKit. This new RealityKit will likely offer developers the ability to
- Break their App out of the iphone screen constraints (UI reprojection)
- Interact with the reprojected apps with new gestures (controls)
- Better integration w/ Siri, eye tracking and handoff services
I think Apple will invite developers to create apps that integrate with the user’s lifestyle, focusing on health, fitness.
- Build custom/new kinds of apps for enterprise use cases and learning (BTW, these are major use cases on the Meta Quest)
Enterprises are less price sensitive than consumers and have existing channels to procure enterprise-ready Apple devices. Companies will have R&D budgets to buy a few devices for pilots. These use cases will heavily emphasize mixed reality and the rendering of three-dimensional (3D) graphics. These use cases include training, virtual models, architecture, industrial manufacturing, design, prototyping, and education.
Sample’s Tim Cook’s quotes over the years around enterprise and learning/training
“We’ve seen early examples of how XR can be used to train employees, provide remote support, and create new learning experiences. We believe that XR has the potential to transform the way we work and learn.”
“I think augmented reality is the future of computing. It’s about taking digital information and overlaying it onto the real world, so you can interact with it in a much more natural way.”
Virtual models of everything you can imagine from the human body to the solar system. And of course you experience them like you’re really there.
Instantly education becomes much more powerful when every subject comes to life in 3D. And imagine shopping when you can place an object in your living room before you make a purchase
Look at this patent around education that they filed.
7. Apple will launch a set of mixed reality extensions to their first party apps to seed the initial consumer demand
Apple will introduce a series of mixed reality extensions to their own apps, aiming to generate initial consumer interest. Here are my predictions, ranked by the marketing messages Apple is likely to emphasize:
- Facetime: Apple will position this as a standout experience, simulating the feeling of being together with friends and family. While FaceTime currently lacks features like green screen filters or virtual backgrounds, the addition of a green screen effect would allow users to see their friends in their own living rooms.
- Notifications: Expect to see Mail, Calendar, Messages, and Facetime notifications appear as floating elements in your peripheral vision, allowing for easy reading and dismissal using micro gestures.
- Mixed reality widgets: Clock, Weather, Stock, as well as Measure and Magnifier apps, could float off to the side, providing at-a-glance information and the ability to measure objects in your physical environment using depth sensors.
- Productivity: Apple may highlight the ability to write documents, email, and work on spreadsheets on a larger virtual screen. However, I have moderate confidence in this prediction as the use case might not be compelling enough to justify purchasing the headset. It may require Apple to find a low-latency solution that allows users to type on a physical Mac while displaying the output on a virtual monitor within the headset.
- New tabletop Maps with geotagged photos: Building on Apple’s recent advancements in 3D mapping, users could explore Maps in tabletop mode and view their own photos as geotags that can be pinched and zoomed into.
- Enhanced Memoji: Apple is likely to introduce an improved version of Memoji for use in Facetime and Messages. Leveraging inward-facing sensors and cameras, users could engage in lightweight mixed reality experiences, capturing and sharing animojis in MR.
Medium confidence predictions
- A better way to listen to music
With Spatial Audio, every note, beat, and instrument comes alive, surrounding you in a three-dimensional audio landscape.
Apple music offers Spatial Audio for over 70 million songs out of the 100 million song catalog. Apple utilizes proprietary wireless technology called “Apple W1” and “Apple H1” chips to ensure seamless communication and connectivity between its AirPods and other devices. The W1 chip enables swift pairing, automatic switching, extended range. The H1 chip enhances wireless audio experiences by delivering faster and more stable connections, and reduced latency. Apple will redeploy these assets for the HMD.
Apple also owns a patent to determine a more accurate, “acoustically-effective” room volume for 3D environments which it will use to improve spatial audio. Combine this with mixed reality and the possibilities are exciting. Imagine a mesmerizing audiovisual experience where you can witness the sound come to life in your own room.
I have moderate confidence in this prediction because I believe that the use case I described may not be compelling enough to justify purchasing the headset. While the idea of experiencing sound waves visually in your room can be intriguing, it may not provide a significant value proposition for potential buyers.
Low Confidence predictions
- While I dont think Apple will position this device as a luxury fashion accessory, it will most certainly try to normalize wearing a device on your face. Just like it did with the Watch, Apple will try to get the headset in high-profile fashion magazines and collaborate with renowned fashion brands to create special editions.
- To bring the device to the mainstream audience, Apple may enlist the support of a Hollywood celebrity (such as Jason Sudeikis) or an edutainment celebrity (like David Attenborough). Another possibility is partnering with Disney to deliver unique mixed reality experiences right in people’s living rooms.
- While Tim Cook has mentioned the potential for mixed reality and augmented reality shopping experiences, I don’t believe these are ready for widespread use just yet. There needs to be a critical mass of headsets in the market and established consumer behaviors before “try before you buy” scenarios become relevant and influential enough to drive purchase decisions.
- Oh and I think Josh Elman has been secretly working on this for many years. Why else would a rockstar product builder and VC go dark over the last few years :-)?
In 3 days, we’ll find out how accurate these predictions are. However, it’s worth noting that the Apple headset has been on the verge of release for the past 6–7 years, so there’s always the possibility that nothing will be announced at WWDC. If they do make an announcement, I believe three things will hold true:
- (I am biased) It will validate the significant amount of work that Oculus and Meta have invested in over the past decade. The hype surrounding the “Metaverse is dead” narrative will temporarily subside.
- The announcement will spark enthusiasm among founders and venture capitalists. It will trigger another mini hype cycle centered around augmented reality and mixed reality. This will be particularly beneficial for visionary founders who have navigated the ups and downs of previous VR and Metaverse hype cycles. I wrote about it here. The recent economic challenges have made it difficult for XR (extended reality) founders to secure funding, and this development could bring about positive change in that regard.
- The initial version (V1) of the Apple headset may not achieve high sales numbers. The V1 headset will serve as a testing ground for Apple to determine the direction of the subsequent version (following the Watch playbook), and the broader community will learn valuable lessons from Apple’s experiment.
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