Apple’s hotly anticipated mixed reality (MR) headset, dubbed Apple Vision Pro, is slated to launch in early 2024 with an eye-watering $3,499 sticker price. As the superstar tech company‘s first major new product category in years, speculation runs wild around its blockbuster potential.
- Will Apple Vision Pro spearhead spatial computing‘s lucrative mainstream invasion?
- Or will lackluster demand leave Apple red-faced with rare defeat on its hands?
Let’s size up this emerging battlefield from an industry expert’s lens to gauge whether Apple Vision Pro will end up in customers‘ hands…or stuck collecting dust on store shelves.
The Story So Far: Apple Under Tim Cook
First, some stage-setting…
Tim Cook took Apple‘s reins from the legendary Steve Jobs in 2011. His decade-plus tenure has kept Apple highly profitable, still dominating tablets with the iPad and holding strong as the world’s second largest smartphone maker behind Android.
But compared to the constant groundbreaking innovations during Jobs‘ reign, Apple‘s product boldness has faded under Cook. Breakdown of notable new product launches by CEO era shows the stark difference:
Steve Jobs Era
(1997–2011)
- iMac (1998)
- iPod (2001)
- iTunes Store (2003)
- iPhone (2007)
- App Store (2008)
- iPad (2010)
Tim Cook Era
(2011–present)
- Apple Watch (2015)
- AirPods (2016) Do those lists seem equal to you in terms of cultural or financial impact?
Yeah, I don’t think so either.
While Cook has grown Apple’s services business successfully with ventures like Apple TV+, Apple Music, and Apple Pay, its last revolutionary device release was arguably the Apple Watch 8 years ago.
And even the Watch pales in comparison to the iPhone‘s total domination and profit engine.
This recent product innovation drought doesn’t bode well for Apple Vision Pro‘s odds to make mixed reality mainstream in one fell swoop.
VR/AR Industry Still Seeking Catalyst for Mass Adoption
While Apple boasts the capital and technological capabilities to make compelling MR headsets, current market conditions present challenges.
The addressable market remains limited as existing virtual reality (VR) and augmented reality (AR) headset sales stay modest.
According to analysis by IDC, only around 15 million VR/AR headsets and glasses shipped globally during 2022. That represents mere drops in the larger technology bucket.
For comparison, Apple shipped over 240 million iPhones in 2022 alone based on estimates.
This massive gap makes clear that VR/AR has yet to transition from early adopter niche to mainstream staple.
Without that fundamental transition occurring first, the MR-exclusive Apple Vision Pro faces constrained addressable market size out the gates.
Here is a breakdown of the installed bases between VR/AR devices versus smartphones globally based on latest IDC data:
Global Device Installed Base
VR/AR Headsets: ~25 million
Smartphones: ~6.4 billion
And smartphone sales still utterly dwarf the ~15 million in yearly VR/AR headset shipments:
Global Device Shipments (2022)
VR/AR Headsets: 15.7 million
Smartphones: 1.24 billion
Until a catalyst emerges to spur mass market VR/AR adoption, even Apple will struggle to sell high-priced MR headsets in huge numbers.
And that catalyst still seems distant as leading VR/AR companies and platforms — like Meta Horizon Worlds — have yet to offer truly irresistible and sticky use cases beyond gaming and niche enterprise applications.
Apple Vision Pro‘s Key Strengths…And Weaknesses
Well, if any company can kickstart mixed reality‘s lucrative mainstream influx, Apple stands the best shot given its premier brand, vast resources, and device ecosystem advantages.
But what exactly does Apple Vision Pro deliver to entice purchases and spark developer imagination? Let‘s examine some key strengths and weaknesses.
Strengths
- Visual Fidelity: Micro-OLED displays with 2x pixels (23 million) versus rivals create crisper, more immersive visuals
- Intuitive Controls: Controller-free interactions via spatial sensing hands, eyes, and voice commands
- Powerful Hardware: Onboard Apple M2 chip delivers snappy performance aided by dynamic scene rendering
- Deep Integration: Tight collaboration and content syncing with Final Cut Pro, Logic Pro, etc.
Weaknesses
- Astronomical Price: $3,499 leaves mainstream buyers priced out until cheaper models launch
- Limited Battery Life: ~2 hours per charge increases friction versus wireless headsets
- App Ecosystem Unknowns: Needs killer spatial computing use cases to emerge quickly
I expect Apple Vision Pro unit sales to disappoint over 12-18 months unless pricing drops. But its state-of-the-art capabilities should delight innovators and enterprises.
Let‘s dig deeper on unit sales projections. Bull case scenario:
- ~500K First Year Sales
Bear case scenario:
- ~5 million First Year Sales
The bull case represents roughly 10% of expected Meta Quest Pro sales its first year — an underwhelming outcome given Apple’s typical market leadership.
The bear case aligns better with Apple‘s track record, outselling rivals 3-to-1. But even 5 million remains tiny for Apple launching a new category.
For context, about 30-40 million Apple Watches sell every year now. To justify its steep price and development costs, Apple Vision Pro needs to follow a similar trajectory over 2-3 years.
If not, it risks being seen internally as a rare misstep for Apple.
The Billion Dollar Crystal Ball Gazing
In my expert opinion as a tech industry analyst, I forecast Apple Vision Pro will achieve moderate / qualified success — but fall short of iPhone-esque greatness…for now at least.
The reasons why come down to patience and maturity. Apple must patiently coax developers to build visually stunning and practically indispensable apps over 2-3 years. Consumer mixed reality comfort and understanding must mature in parallel by getting accustomed to less tech-savvy offerings first.
Once mixed reality goes further mainstream, Apple can unleash the full disruptive potential of spatial computing across entertainment, communication, collaboration and beyond.
But in the next 12 months, Apple Vision Pro will primarily excite wealthy early adopters rather than average consumers. And that lukewarm reception risks headlines dubbing it a disappointment.
Still, by seeding interest and showcasing technical possiblities, it moves the mixed reality ball forward. Often Version 1.0 acts as table stakes allowing Version 2.0 or 3.0 to provide the true killer app.
So I believe Apple Vision Pro will fall short of revolutionizing tech like the iPhone…for now. Its successors may tell a different story in 3-5 years however.
Patience and maturity remain the market‘s — and Apple‘s — best friends to shift mixed reality into inevitable ubiquity.