Apple’s pricy $3k AR/VR headset makes it a prosumer bet: IDC

Apple is widely expected to announce a mixed reality headset at WWDC on Monday priced at around $3,000 and focused on a prosumer audience. 

With that price point and the potential for industrial and business users alongside consumer gamers and fitness enthusiasts, Apple might be able to distinguish itself from other AR/VR headsets which slowed  by 54% in the first quarter.

“All eyes are on Apple, which has yet to announce a headset,” said IDC analyst Jitesh Ubrani, research manager at IDC in a note on Thursday. “Apple’s sizeable installed base of existing products and services will certainly help set the company’s headset apart from other AR/VR vendors.”

However, he said Apple’s potential to gain share will be limited partly because of the reports the device will take a prosumer approach but also because of its hefty price tag.

 “The likelihood of it being a prosumer device or an enterprise device is very high, especially given the rumored specs,” Ubrani told Fierce Electronics. “The displays, processor and price are all skewed towards the premium end of the spectrum. IDC, like many others, has heard it will be around $3,000.”

The Verge and other outlets have reported Apple’s headset will be called Reality Pro capable of virtual and augmented reality experiences where users switch between AR and VR using a digital crown-style dial. VR is generally closed off from the nearby environment of a user, while AR relies on the ability to see through a semitransparent display while also seeing animations projected on the lens. 

In recent years, industries including aircraft manufacturers and medical doctors have touted the ability to use AR when repairing devices or conducting some medical procedures.  Techs and doctors can also use goggles or headsets to prep for repairs or operations.

Other possible features in the Apple device include support for eye and hand tracking that works on an OS called xrOS.  Support for FaceTime calls is also possible. An external battery pack would sit in a user’s pocket.

Apple has invited VR developers to a live portion of WWDC, an indication to Apple observers that a headset will be unveiled at what is normally a software event.  The types of apps to be created will vary across business and consumer interests, according to analysts who follow Apple.

“When it comes to use cases, I suspect we’ll see the most prevalent use cases today for gaming and health and fitness, but beyond that I also expect Apple to show off productivity-oriented features and use cases such as industrial design, remote collaboration and more,” Ubrani told Fierce.

In the near term, the challenges for Apple will be economic as much as technical.  IDC reported Thursday that global shipments of AR and VR headsets slowed significantly as macroeconomic conditions worsened. The analyst firm reported a 54.4% decline year-over-year in Q1 across six headset makers.  IDC did not report a total number of headsets shipped in the quarter, however.

In March, IDC reported shipments for all of 2022 reached 8.8 million units, down nearly 21% over 2021. https://www.idc.com/getdoc.jsp?containerId=prUS50467723

For the first quarter, Meta Quest led with nearly 48% market share, while Sony’s PSVR 2 captured nearly 36%. ByteDance had 6.1%.  DPVR and HTC each had less than 2% share.

Despite the downturn, Ubrani said it is still an exciting time for the AR/VR market. IDC research director Ramon Llamas predicted headsets will “eventually gain salience with users” even as they have been used by a select audience initially. “The AR/VR headset arriving as early as 2025 will make today’s headsets look quaint,” he predicted.

VR headsets currently dominate the market by more than 95%, but AR headsets had a solid first quarter, up 12.6%.  Nreal, now Xreal, offers a headset that is an external display for connected devices.

WWDC runs June 5-9 with an opening keynote set for 1 ET on Monday June 5. Apple will be streaming the event on the theme of “Code new worlds” on its website, as in the past. 

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