Apple is Ready to Take Over the VR and AR Market

The world’s most valuable company may not be the first to a product innovation, but when Apple weighs in on an up-and-coming technology, it is often the best.

Now you might say that is subjective—frequently when someone tweets about Apple products, but especially Macs—they’re met with vitriol about how another product is better. Technologically accurate or not though, Apple has a way, different than any other company, of marketing a product extremely well with actually very little effort. The company’s word-of-mouth marketing and the status of owning and wearing its products are second to none in the consumer technology space.

Apple was not the first to Bluetooth earbuds, but the AirPods are the most recognizable piece of technology in the world. Same with smartwatches and smartphones, but an Apple Watch or an iPhone is never mistaken for anything else. And now, it seems Apple is in the home stretch of planning domination for another wearable technology: mixed-reality headsets.

On Tuesday, The Information reported a long list of features coming in Apple’s long-rumored mixed-reality headset. Then, later in the week, reliable Apple analyst Ming-Chi Kuo tweeted that while the company has hit some production hiccups on the device, he believes an announcement for it could be as early as this spring and a release set for Q2 or Q3 2023.

Research and development is always a busy topic (Apple car, anyone?)—but it’s rare that details and releases, at least from reliable analysts and reporters, so specific are wrong. So it seems likely that the release of the new Apple mixed-reality headset is imminent, and if the AirPods are a guiding tool, so is the company’s market domination.

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With the release, Apple is directly putting HTC, Valve and, most importantly, Meta, in its sights. It’s already at odds with Meta over restricting outside-of-app tracking for advertising purposes, which has significantly kneecapped Facebook’s advertising capabilities on mobile. The two companies have already publicly tossed insults at one another, and Apple taking on Meta’s most-focused department in virtual reality will only increase that tension.

The reported feature set for the new Apple mixed-reality device—such as its Magsafe, waist-mounted battery pack and quick switching between real life and the virtual world, according to The Information—make it seem less like a competitor to the Quest 2 or Quest Pro. It’s more likely a competitor to Google Glass, which flopped when released to consumers in 2014.

Google likely came too early to the mixed-reality wearable market, but Apple seems right on cue. At least if you only look at product advertisement, that is.

The Quest 2 is a heavily-advertised device, and while there’s not much data on consumer sales in Q4 just yet, it’s fair to assume it was a popular holiday gift item. It’s a fun device—I purchased one in August—but it’s not exactly stylish, and unlike the reports on the Apple headset suggest, it does not feature a way to swap to a real-life view. The only time you get a view of your surroundings with the Quest 2 is when you step outside of your play area, or when you’re setting it up before the season.

And then there’s the biggest flaw of the Quest 2 and many virtual reality headsets: They’re bulky.

They may be comfortable for gaming sessions, but they’re not something you’d exactly want to have on your head “Ready Player One” style with your peers around you. That is the world that Meta founder Mark Zuckerberg—and seemingly Apple CEO Tim Cook—want us to live in: One where augmented and virtual reality alter the life around us for the better. I mean who doesn’t want a J.A.R.V.I.S., am I rite?

But that brings up another issue that Apple is all too familiar with: pricing.

Many of Apple’s products are inaccessible. A new MacBook costs just under $1,000. If you want something a bit more powerful, that number very quickly triples. It’s AirPods Max, which I recently purchased, are probably the best over-the-ear headphones available. But at a $550 price point, they, too, aren’t easy to break in to.

By contrast, the in-ear AirPods’ pricing is much more palatable, starting at just $129. The iPhone, too, has begun to make some real headway with its SE devices, which are less feature-rich but more affordable for less-affluent customers, with a starting price point of $429. Apple knows how to slim down some of its products to not break the bank, but the success of its new headset will heavily rely on this.

NYU marketing professor and tech pundit Scott Galloway often talks about the status symbol attached to ownership of Apple devices. “Apple is sex,” he said at a French conference in June 2017—a retort he often restates on the “Pivot” podcast which he co-hosts with tech journalist Kara Swisher. His point is that having an iPhone and AirPods, versus an Android device or another pair of wireless earbuds, demonstrates wealth, and he hypothesizes that it makes you more attractive.

While there’s no data to back that up, I do know that, anecdotally, his read on the situation isn’t totally inaccurate.

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Apple devices do make you part of an “exclusive” club—even though the iPhone recently took over 50 percent of market share of cellphone owners in America. That high price point is a humblebrag, and with the forthcoming mixed-reality headset, it likely will remain that way.

But with something so experimental and new, Apple will need to find the perfect balance between sexy and affordable. No one’s lining up out the door to get the Quest Pro, Meta’s new productivity device. Even at a much more affordable price, the Quest 2 is still a novelty, not a necessity.

Making a new device a necessity, like the AirPods, is what Apple needs for its new vertical to be successful.