A recent report released by market research firm IDC said that Facebook’s parent company, Meta, cannot sell virtual reality devices at a loss forever. It believes that Meta’s current strategy in virtual reality is “unsustainable” and that “all eyes will be on Apple.
The report predicts that if Facebook’s parent company Meta’s strategy of selling virtual reality device hardware remains unchanged, it may not be able to compete with other companies in the mixed reality space in the long run.
IDC research manager Jitesh Ubrani said, “While Meta continues to invest heavily in developing its meta-universe business, the strategy of promoting low-cost hardware at the expense of profitability is unsustainable in the long run.”
Late last month, leading tech industry analyst Ming Kuo? also mentioned a similar view. Guo Ming? predicted that Meta will move to scale back its investment in virtual reality, creating opportunities for Apple and other competitors. He also believes that Meta’s practice of selling virtual reality headsets at a loss is unsustainable.
According to data released by IDC, Meta currently holds 90% of the market share in the virtual reality headset market. In second place is Pico, which is owned by ByteDance, with a market share of only 4.5%. Overall, virtual reality headset shipments grew 241.6 percent year-over-year in the first quarter of 2022, but it should be clear that the entire market faced serious supply issues in the first quarter of 2021, which made the first quarter of this year “good year-over-year.
IDC research director Ramon Llamas also said, “All eyes will be on Apple as it launches its first headset device next year.” The industry expects Apple’s headset to be much more expensive than the Meta product, thus pushing up the average unit price of the entire product category. According to Lamas, Apple’s headset “will appeal primarily to a small group of early adopters and Apple fans.
In other words, don’t expect Apple’s first headset in mixed reality to ship in higher numbers than Meta’s Oculus Quest 2. This is just the first step in Apple’s long-term plan to capture the mixed reality market. As several reports have noted over the past few years, Apple will still eventually launch low-cost augmented reality glasses and other products to keep expanding the company’s user base in the mixed reality space.
Apple and Meta aren’t the only companies working to bring mixed reality hardware to the masses, and in April, it was reported that Amazon had posted several job openings for people to help the company develop “advanced” mixed reality products. Last December, the job posting showed that Google plans to develop a new augmented reality device and operating system.