Apple’s virtual reality (VR) headset, which is expected to be a standalone, high-end device costing around $3,000, launching in January 2023, will boost demand for associated VR and augmented reality (AR) games, apps and services. These categories are increasingly important to Apple’s bottom line, says GlobalData.
The leading data and analytics company notes that given Apple’s massive loyal customer base and a productive legacy of entering new markets, the company’s VR headset will trigger faster adoption of VR and AR tech, which is key for the growth and adoption of the metaverse.
Anisha Bhatia, Senior Analyst at GlobalData, comments: “Apple’s services revenue accounted for more than 20% of its overall revenues, which reached $19.8 billion in Q2 2022, up significantly from $16.9 billion a year earlier. Apple will use its forthcoming VR headset device to build on that revenue growth. According to GlobalData forecasts, consumer VR headsets will generate global revenues of $50 billion by 2030.”
Although the headset will be a standalone device (not tethered to a computer or gaming console), we can expect to see some cross-device operability as Apple will play into its strength. Industry rumours indicate that consumers will likely be able to extend a MacBook’s display into the headset, allowing content creators to seamlessly move from one device to the next, a key Apple attribute that other multi-device OEMs in the non-iOS space have struggled to match.
Bhatia continues: “Apple is working on VR versions of several of its apps, such as FaceTime. The company has a history of first-rate user interfaces, be it smartphones or wearables or tablets; we can expect its VR clients to be just as good. And Apple rarely launches a product that is not on par with its standards. The company will also make sure it has a swathe of apps and services that can be used with the headset at the time of launch.”
Meta Platforms owns 90% of the VR headset market, offers exclusive content and trumps Apple’s headset on price. However, Meta heavily subsidizes its VR hardware, which is not a sustainable business strategy as the competition in this space is set to grow in 2023, with VR headsets coming from Pico and Sony.
Bhatia adds: “Although price may initially prove to be a hindrance for Apple, its product quality, target market of developers, gamers and content creators, as well as a previous history of market-leading expensive products such as tablets, leads us to believe that Apple’s first foray into the VR headset segment will be a success. We expect the first iteration of Apple’s VR headset to be Wi-Fi only, and Apple, similar to Meta, is already working on a second iteration of its headset which will likely offer 5G support.”
