Can Apple save the outdated metaverse?

On June 5th, foreign media pointed out that Meta CEO Mark Zuckerberg announced the sale of the company’s first consumer-grade MR headset, Meta Quest 3, for $500 this fall, ahead of Apple’s long-rumored Reality Pro headset. Meta’s move to grab the spotlight from Apple is clear, and the concept of the metaverse, which has already passed its peak, is not going away and may even shine again. In late October 2021, Facebook co-founder and CEO Zuckerberg, who had a dream of the metaverse, officially announced that the company would change its name to Meta. The new name Meta is derived from the word Metaverse, which means the metaverse. A month later, Microsoft co-founder Bill Gates wrote in a blog post that in two to three years, he believed that most virtual meetings would transition from two-dimensional video grids to three-dimensional spaces with digital avatars in the metaverse. Shortly thereafter, Microsoft announced the $70 billion acquisition of video game giant Activision Blizzard, stating that the deal would provide the metaverse with the necessary resources. However, people’s interest in the metaverse suddenly came to a halt. Technology industry investors have turned their attention to new trends such as artificial intelligence. Despite the initial enthusiasm, companies such as Disney and Microsoft have still terminated some metaverse projects. At the upcoming Apple Worldwide Developers Conference, the tech giant is expected to launch its virtual reality hardware product: a high-tech headset that blends digital and real-world elements. Apple is betting that it can use mixed reality products to better attract consumers than Meta. Meta’s high-end Quest Pro headset had a mediocre performance after its launch, and Apple can ignite mainstream consumers’ interest in virtual reality devices in ways that other companies cannot. According to current and former employees familiar with Apple’s development plans, the Apple headset, which looks like ski goggles, is expected to be priced at $3,000. Apple has done this before. The final popular products such as the iPod, iPhone, and Apple Watch started in niche markets and later became mainstream products. However, even Apple executives are skeptical about the company’s prospects in the virtual reality field. They say that virtual reality may not yet be ready for its mainstream moment. As of now, Apple has not commented on this report. For many investors, the idea of an immersive, all-encompassing online world is more meaningful because people are forced to stay at home during the pandemic. According to data compiled by PitchBook, metaverse-related startups raised about $660 million in venture capital in the first five months of 2023, down significantly from $2.93 billion in the same period in 2022. PitchBook said the decline would reduce recent startup investment in the metaverse to about a quarter of the peak in the first half of 2022. Cowen & Company analyst Doug Creutz said the metaverse investment boom came and went, and now people are focusing on artificial intelligence. People who once embraced the metaverse have changed their stance. This year, Microsoft closed down AltspaceVR, a virtual reality world it acquired in 2017. According to sources, the company also fired employees working on HoloLens mixed reality headsets and canceled or reassigned teams that had been working on metaverse projects. However, Microsoft said in a statement that it is still committed to the metaverse and is launching three-dimensional avatars for Microsoft Teams. According to sources, Disney also fired about 50 employees who had worked on metaverse projects. As for Meta, Zuckerberg’s reorganization plan centered on the metaverse has been costly. Meta’s hardware division, Reality Labs, which includes its Oculus headset, is a significant reason for Meta’s significant spending increase in recent years. The department’s loss in the first quarter of this year was about $4 billion. Zuckerberg warned that building the metaverse would be a loss-making proposal that would almost certainly not deliver early returns and would take much longer than he anticipated. In recent months, despite Zuckerberg’s frustration with the idea that the metaverse is no longer his focus, he and his assistants have spent more time discussing Meta’s expertise in artificial intelligence. A spokesperson for Meta, Ashley Zandy, said: “We have always been clear that our vision for the metaverse is long-term and that has not changed. We are committed to the metaverse vision and have seen good momentum.” Recently, ahead of Apple, Meta announced that its first consumer-grade MR headset, Meta Quest 3, would be released in the fall of 2023, priced at $499.99 for 128GB. So far, consumers have spent over $1.5 billion on apps and games in Meta’s Quest app store. For Apple, its new headset may be the start of a long-term plan that could eventually result in a more popular virtual reality product in the market, such as a lightweight pair of glasses. Some analysts recommend that Apple take an experimental approach to evaluate how early users use it and make changes before marketing future versions to a broader audience. This is similar to the situation with the Apple Watch. The product was initially positioned as an accessory to the iPhone but was later redefined as a fitness device. Although the enthusiasm has waned, many still believe that the metaverse will not disappear completely. Before Meta promoted the metaverse, some companies were already promoting the technology, such as Roblox and Epic Games, which are still committed to their long-term vision. Venture capitalist Matthew Ball wrote a book about the metaverse. He said that the mainstream attention to this concept after Facebook renamed itself Meta has stimulated strange predictions about whether people will spend time in an immersive online world. This is more about poor time management, Ball said. The strong interest in the metaverse in the short term has led some to believe that it is already here or about to be here, and this is bound to disappoint many people. With millions of participants, user-generated content, and a digital economy, Roblox and Epic Games can offer a more compelling vision of the metaverse. Roblox is a platform with millions of games that are often targeted at children and had 66.1 million daily users in the first quarter of 2023, up 22% from a year ago. The company’s chief business officer, Craig Donato, said Roblox is working to expand into other immersive online experiences, but a mature metaverse is still far away. “We’re still largely in the early stages,” Donato said. In March of this year, Epic Games released new tools to help Fortnite players create their own games on the platform and make money from them, which drove the creation of an online economy for Fortnite – the cornerstone of CEO Tim Sweeney’s vision for the metaverse. Sweeney said the mainstream interest in the metaverse attracted those who are not really interested in the field. Many people have tried to follow this trend, but have not really fulfilled their promises, he said. But if you look at the trend, you will see that it is still growing and seems to be growing exponentially.

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