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Text / Zhao Jinjie
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Although the outside world is still looking forward to the launch of Huawei Mate 50 and Apple iPhone 14, it is difficult for them to lead the future trend, and VR/AR is one more thing that the public cares about.
This can also be felt from Apple’s previous conferences since 2022: at Apple’s spring new product launch in March, in addition to waiting for the third generation of iPhone SE, the most anticipated thing is the appearance of Apple’s AR glasses; in June At the Apple Worldwide Developers Conference (WWDC), the much-anticipated Apple AR product missed the appointment again; now, the outside world is placing its hope on Apple’s autumn new product launch conference held in the early morning of September 8, Beijing time.
In the context of the slowdown in global smartphone growth, Cook has planned three major breakthrough areas for Apple in the future – artificial intelligence, AR and autonomous driving. The smart glasses and smart car projects that have been implemented around the latter two have become the two major innovative businesses that Apple has invested in since 2018.
Almost all of them were first exposed in 2015: In February 2015, the Wall Street Journal revealed that an Apple truck with multiple cameras placed on the roof appeared on the streets of Northern California; in the same year, Apple relied on the German start-up it acquired. The company Metaio has formed a VR/AR project team.
But in deciding who will be Apple’s ticket to the new era, Cook was once in a tangled state. Both the smart glasses and smart car projects have experienced internal line swings: Apple has built a car in eight years. Do the system – reengineering the back and forth adjustment of the whole vehicle; smart glasses are also constantly different in the form of VR all-in-one, AR and MR.
As a direct result of the internal indecision, the early management team of Apple’s car project has almost completely left, and the production time has been delayed again and again. Well-known Apple analyst Ming-Chi Kuo bluntly stated that the Apple car may not be unveiled until 2028.
The planned time to market for the smart glasses has also changed over and over again. According to Bloomberg Gurman, Apple’s smart glasses were originally planned to be announced in 2019, and then adjusted to be released in 2021.
The latest news is that Apple’s first smart glasses will be unveiled in early 2023. Gurman revealed the name of Apple’s first smart glasses, the Apple Reality Pro, in a blog post on September 4.
Judging from the current project promotion, Cook has clearly made a final decision – AR replaces smart cars as Apple’s new ticket.
It is not only Cook who regards smart glasses as a new ticket, but also Ma Huateng who proposed the new concept of the true Internet, Zuckerberg who renamed Facebook Meta, All in Metaverse, and spent billions of dollars to acquire PICO. Zhang Yiming and so on.
Before the iPhone was released, Jobs also considered the possibility of building a car. After comparison, Jobs focused on the smartphone.
Today, Cook has once again replicated Jobs’ choice, choosing smart glasses in the AR versus autonomous driving comparison. But waiting for Cook’s challenge is only a lot more than in the Jobs era.
A
In the process of exploring the AR innovation business that will determine the future, a major challenge for Cook to face is that Apple is mired in the reality of slowing revenue growth in the main iPhone business, which forces it to make the largest adjustment to its existing internal business. to expand revenue streams.
In August, Bloomberg broke the news that Apple has changed its previous advertising rules and plans to expand advertising to more areas such as iPhone and iPad to create new revenue channels.
Specifically, in addition to loading advertisements in the existing news and stock apps, Apple will further expand them to apps such as maps and podcasts, and even does not rule out the use of Apple TV+’s tiered subscription model to generate more content like Netflix. Multiple advertising revenue.
Taking the map app as an example, when a user searches for “Chinese restaurant” on the map in the future, the store that spends money on it can be ranked at the top of the search results page.
Coinciding with the new advertising deal, the Financial Times reported in September that Apple was planning to nearly double the number of employees in its fast-growing digital advertising business.
The declaration that Jobs said when he launched iCloud in 2011, “There will be no advertising in iCloud”, began to fail in the face of Cook’s New Deal.
In March before the major adjustment of advertising strategy, Apple was also exposed by the media about a new subscription service around hardware, which allows subscribers to pay a certain monthly fee to directly use the newly released hardware products, similar to iCloud mode. This means that users can enjoy the latest iPhone products within a certain period of time at a lower cost.
Apple could launch the new subscription service as soon as the end of this year. “The Wall Street Journal” commented that once successfully implemented, this will become the biggest driving force for change in the history of Apple’s hardware sales so far.
The biggest reality for Cook’s decision to make money is that the world‘s smartphones are entering a downturn. According to an IDC report, smartphone shipments in 2022 are expected to decrease by 6.5% to 1.27 billion units. Since 2021, the mobile phone industry has turned to a market with constrained demand. “High channel inventory, low demand and no immediate sign of recovery have OEMs panicking and slashing orders for 2022,” IDC analysts noted.
Apple’s financial report has a more intuitive reflection. The main business of Apple’s iPhone, which still accounts for more than 50% of its revenue, is beginning to face the reality of slowing growth. Taking Greater China as an example, after jumping to No. 1 in the Chinese market in the fourth quarter of last year, Apple’s sales in the second quarter fell from No. 3 in the previous quarter to No. 4 in the market, and the growth rate of iPhone revenue continued to maintain at 2%. The level of the left and right drives the revenue of Greater China from an increase to a decrease in the second quarter compared to the same period last year.
The more serious reality is that if the slowdown in hardware growth continues, it will inevitably affect the continuous growth of Apple’s software services.
Whether starting from the current reality or from the future competition, it is time for Apple to develop a new hardware and create a new ecological growth engine that combines software and hardware.
Smart glasses are undoubtedly the ticket that Cook found for Apple to catch the new era.
According to IDC’s forecast, the global shipment of VR products will increase to 28.6 million units in 2025, with a compound annual growth rate of 41.4%. By then, the global VR/AR market will reach nearly 2 trillion yuan.
Wedbush analyst Dan lves even pointed out that smart glasses associated with the concept of the metaverse are expected to raise Apple’s stock price by $20 per share.
B
Touching the closed ecological model built by Jobs’ iPhone + iOS, Cook is replicating this successful experience in the field of smart glasses.
In the information exposed together with Apple’s smart glasses, the research and development of the Reality OS (reality operating system) supporting the hardware is also progressing simultaneously.
Cook clearly wants to create another App Store for smart glasses to publish downloadable games, streaming video and more. Bloomberg describes it as an “all-encompassing 3D digital environment” designed for gaming, media consumption and communications.
Meta, the leading representative manufacturer in the field of smart glasses, has turned to the opposite of Apple and chose to build an open ecosystem.
After being absent from the Metaverse Open Standards Group established by Meta, Microsoft, Epic Games and other companies in June, at an all-hands meeting that month, he asked an employee, “How will Apple’s failure to participate in the organization affect Meta’s ecology?” system”, Zuckerberg said that Meta would compete directly with Apple in creating a VR/AR platform to decide “in which direction the Internet should go.”
While Apple is able to build a better consumer experience by being hands-on and closely integrating its own products, in Zuckerberg’s view, he can’t yet determine which is better, an open or closed ecosystem,” Apple’s strategy May prove more beneficial than Meta’s open ecosystem… Meta’s goal is to get its hardware into the hands of as many people as possible.”
In Zuckerberg’s view, Meta and Apple are positioned like Android and iOS in the smartphone era. After announcing the dissolution of its VR/AR operating system development team of more than 300 people in February, the current Meta Quest smart glasses already allow users to sideload applications that are not certified by the Meta VR app store.
According to Gurman’s latest revelations in early September, Apple is developing at least three MR devices, the first of which may be launched under the name of “Apple Reality Pro” with internal codes “N301”, “N602” and “N421”. Apple Reality Pro, which will directly target Meta’s upcoming Quest Pro device.
According to previous news from Ming-Chi Kuo, the price of smart glasses that Apple will release as soon as January next year may be around $3,000. The target user group of this product is not C-end consumers, but for technology developers, content creators and professionals.
After the MR equipment is updated and iterated for a period of time, Apple will officially launch the final product form – AR glasses, the rumored Apple Glasses, but the release time is still unknown, and the news learned by Bloomberg is only shown as a vague “a few years later”.
Clearly, Apple has learned from Google Project Glass in this regard. When Google Glass was launched in 2012, it was claimed to have the same functions as a smartphone, such as taking pictures, video calling, navigating, surfing the Internet, sending messages and emails, and weighing only a few dozen grams. This directly increases the cost and difficulty of mass production of Google Glass. In January 2015, Google officially announced the discontinuation of the Google Glass project.
Until now, AR industry practitioners are still pursuing the best balance of weight, experience and mass production. The Apple Reality Pro, which is expected to be launched early next year, is the product of the mutual compromise between the above three.
According to “The Information”, Apple’s board of directors had concentrated on a large number of VR/AR devices and prototypes, demo demonstrations, etc. in 2016. At the beginning, at the insistence of former Apple designer Jonny Ivey, Apple considered adopting the “VR box”. ” style design, the VR function can be realized by matching a smartphone, but Mike Rockwell, the head of the VR/AR project at the time, hoped to launch a more powerful related device in the form of a VR all-in-one machine.
In the end, under the coordination of Cook, Apple chose a compromise route – first develop products in the form of MR, and then gradually evolve to a more lightweight, compact and powerful AR form.
After all, AR is the area Cook has always been optimistic about. In an interview with Indenpendent in 2017, Cook said: “AR is a great idea like a smartphone.”
After the concept of the metaverse became popular, Cook said in an interview with Time Magazine last December, “The metaverse and AR are obviously two different words, and I will only call it AR.”
C
Cook isn’t alone in seeing smart glasses as the next operating terminal idea after smartphones.
Zuckerberg was the first to publicly call out the idea. After buying Oculus for $3 billion in 2014, Zuckerberg once said to the public that after missing the design of smartphones and their operating systems, many companies can only become vassals of Google and Apple. “In the future, only with our own hardware platform and system can we control our destiny.”
VR/AR is exactly what Zuckerberg believes is the next-generation computing and communication platform after the mobile phone.
In the company’s internal magazine at the end of 2020, Ma Huateng wrote an article pointing out that another major reshuffle is about to begin. “Just like the transformation of the mobile Internet, those who can’t get on the boat will gradually fall behind… Now, an exciting opportunity is coming. After ten years of development of the mobile Internet, the next wave of upgrades is about to be ushered in, which we call the true Internet. .”
In order to implement Ma Huateng’s concept of the true Internet, Tencent not only announced the acquisition of the gaming mobile phone company Black Shark Technology, but also changed its business focus from gaming mobile phones to VR devices, but also made structural adjustments in June this year. IEG ( The XR department was officially established under the Interactive Entertainment Business Group), which was handed over to Ma Xiaoyi, the senior vice president of Tencent and the actual trader of the game business.
ByteDance directly exchanged money for time. In August last year, it spent billions of dollars to acquire VR manufacturer PICO, with a FireWire layout. In October of the same year, Zuckerberg renamed Facebook Meta, calling out a manifesto to transform Facebook into a metaverse company within five years.
Not only big companies, but new entrepreneurs are also eyeing the trend of smart glasses. Luo Yonghao, who quit the management of making friends in June this year and announced that he would start a business again, pinned his hopes for the rest of his life on the next-generation computing platform represented by AR.
But it is undeniable that among these companies rushing to the VR/AR field to compete for tickets in the new era, the outside world is more looking forward to Apple’s fate, hoping to use Apple to ripen smart glasses as soon as possible.
As Feng Chao, a senior analyst at Cinda Securities, said, Zuckerberg’s bet on the Metaverse may now be a “wrong move” because it cannot enhance the user stickiness of Facebook’s original products at this stage.
When Apple’s products are introduced to the market, with its unparalleled appeal in the field of consumer electronics, with the help of its 34 million developers around the world, its software business ecosystem around the world, and Apple’s continuous financial support, it will undoubtedly be To attract more people to join the VR/AR field, investment bank Wedbush believes that this will make the behavior of filling VR/AR-related ecological shortcomings more efficient.
“Come from behind” and detonate a certain category has always been Apple’s forte. The iPod, iPhone, and iPad of the Jobs era have all redefines products and sets trends in the industry.
In the age of Cook, Jobs-style miracles have also been staged on Apple Watch and AirPods.
But as the third piece of hardware under Cook’s leadership, AR differs from Apple Watch and AirPods in that they are no longer an accessory dependent on the iPhone, but an alternative terminal that rivals or even surpasses the iPhone, and is better than operations management. Cook, whether he can lead Apple to achieve a Steve Jobs-style disruptive innovation, is causing some questions from the outside world.
For example, Luo Yonghao bluntly stated in an external interview that he has no expectations for the product innovation of Apple’s smart glasses. “In the eleven years after Jobs’s death, the company has done a really good job except for one wireless earphone, with almost zero innovation in other products, and some even significantly backward.”
How to solve Luo Yonghao’s questions, the outside world is looking forward to Cook’s AR answer sheet.
