Many companies are now scrambling to invest in the virtual reality market. This technology is developing faster than anyone realizes. It is already becoming a crucial part of remote working, teaching, and learning especially since the spread of the Coronavirus. Tech giants are especially interested in acquiring assets that will boost their portfolio and put them on the VR map. Apple is no different and recently announced its latest acquisition, chasing after Facebook in the great race to see who will be the next big VR mogul.
Apple announced that it would buy the California-based company, NextVR for $100 million. NextVR streams live events to AR/VR devices. They hold over 40 patents for those technologies. However, 40% of its staff had to be laid off last year due to a lack of funding. The start-up was valued at $800 million less than 4 years ago. $100 million isn’t that much money for Apple. It definitely won’t make a dent in its net worth. The company ended last quarter with $207 billion in cash equivalents, cash, and marketable securities.
Facebook dove headfirst into the VR market when it bought Oculus for $2 billion in 2014 but Apple decided to take baby steps. Apple instead acquired several smaller AR/VR firms to assemble a team of industry experts. Gradually the company filed patents for headsets, it added improved depth-sensing cameras and computer vision chips to its newer iPhone models. It introduced the AR kit that allowed developers to create their AR content. Facebook’s Oculus Quest only hit 705,000 shipments last year. This lack of enthusiasm showed why smaller VR start-ups like NextVR struggled to secure funding.
Why would Apple then be interested in NextVR? The company is partnered with big brands such as NBA, Wimbledon, and Fox Sports, and the idea of streaming sports events through a VR headset is catching on. Apple might see potential in NextVR’s technology as an AR extension of its AppleTV, Apple Arcade, and Apple Music. These three services generated 14% of the company’s total revenue last quarter. It could allow Apple to make VR content for its TV shows, video games, and exclusive concerts. Viewers might not want to watch an entire game or show in VR but they might want to watch highlights.
Apple is probably not going to chase Facebook’s Oculus into the VR market anytime soon. They are laying down AR/VR foundations that could compete with Facebook in the next 5 years. According to reports, Apple is currently developing an AR headset. This won’t be released until 2022. Facebook is also reportedly developing its AR headsets, Stella and Orion, set for release anytime between 2022 and 2025. These glasses could be lighter than the current AR glasses on the market such as Microsoft’s HoloLens, Magic Leap One, and Facebook’s original Oculus. It is all speculation for now but with news like this, techno-junkies can’t help but get excited.
April 8, 2020
