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Wednesday, January 11, 2023
Apple’s mixed reality headset won’t replace the iPhone
Apple (AAPL) is set to unveil its first mixed reality headset. According to Bloomberg’s Mark Gurman, the Cupertino-based company plans to unveil the much-anticipated hardware called Reality Pro ahead of his Worldwide Developers Conference event in June, before launching it later this fall.
For years, Apple has been looking for new products to offset its reliance on iPhone sales for the majority of its revenue. It introduced subscription services like Apple TV+, Apple Music, and Apple Fitness+, and debuted accessories like AirPods and Apple Watch. But they are more or less add-ons for iPhone owners.
The Reality Pro headset, on the other hand, is a self-contained device that puts the company into a whole new computing space, competing directly with the likes of Meta (META). The headset is expected to be one of the most advanced on the market, complete with a high-definition display, an external camera for augmented reality features, and powered by Apple’s own M2 processor.
But don’t expect Reality Pro to save Apple from its iPhone dependency any time soon.
“This is a nonsensical product,” UBS analyst David Vogt told Yahoo Finance. “This is a very high-end device. So I think the volume will be relatively low.”
In other words, Apple’s iPhone remains Apple’s most important product, no matter what real world you’re in.
Apple’s iPhone is as important as ever
In 2022, the iPhone accounted for $205.4 billion of the company’s total revenue of $394.3 billion. Apple’s second-largest business segment, services, will account for just $78.1 billion in the company’s 2022 total revenue. Combined, the wearables, Mac, and iPad businesses had less revenue than the iPhone at $110.7 billion.
“Apple has become a one-size-fits-all economy, so to speak, and its reliance on iPhone revenue is probably starting to become a problem in terms of its ability to sustain growth,” NYU Stern School of Business professor Arun Sundararajan told Yahoo Finance. “So I saw motivation from within the company to create another revolutionary product.”
But analysts say that with the Reality Pro’s soaring prices, it’s unlikely to sell in the volume needed to overtake the iPhone.
Global VR and AR device shipments are expected to reach 66.8 million units by 2026, according to CCS Insight. This is a significant increase from his 9.6 million in 2022, but the number of smartphones that IDC shipped in 2022 falls short of his 1.24 billion.
According to Vogt, the only product that could help Apple become more than just an iPhone company is an automotive codenamed Project Titan, or a deeper foray into healthcare.
So why would Apple want to jump into mixed reality in the first place? Given that mixed reality headsets and the software that accompanies them may end up being your go-to, you can’t fall behind. futuristic device.
After all, Apple has seen firsthand how much Microsoft suffered for entering the smartphone market too late. After he spent $7.2 billion to buy Nokia in 2014, the cloud computing giant sold some of the cell phone makers for scrap.
Smartphones are still central to our digital lives
Apple’s iPhone is a generational product, from competitors (Google re-prototyped Android phones after Apple founder Steve Jobs debuted the iPhone in 2007) to cars. , has influenced everything.
“Every significant part of our lives is impacted by smartphones on a daily basis,” Anindya Ghose, a professor at New York University’s Stern School of Business, told Yahoo Finance.
“Given this, I do not see a viable path for virtual reality devices to have a significant impact in terms of mindshare and consumer adoption. am.”
Of course, that could work in Apple’s favor. The company’s customers tend to be highly loyal, offering an installed base of hundreds of millions of iPhone users ready to check out the latest devices.
Still, it’s hard to imagine that these consumers would be willing to wear headsets to watch content for extended periods of time. Headsets, regardless of who makes them, are still too bulky and uncomfortable as a personal primary computing vehicle. According to The Verge, even Meta’s high-end Quest Pro is too heavy and uncomfortable.
That doesn’t mean that Apple’s mixed reality headsets won’t be successful or that they won’t help drive consumer interest in virtual and mixed reality. But for the foreseeable future, the iPhone will remain Apple’s breadwinner and most influential product.this is in fact We guarantee.
To Daniel Howley, technical editor at Yahoo Finance.follow him @Daniel Howley
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