Apple's mixed reality headset development taken over by Chinese supplier

Posted:
in Future Apple Hardware
A new report says Apple will rely upon Chinese company Luxshare, not its usual Taiwanese suppliers Foxconn or Pegatron, to develop its first mixed reality headset.

Apple's VR or mixed reality headset
Apple's VR or mixed reality headset


Apple generally relies upon its longtime Taiwanese supply chain to develop and release first-generation products. However, if a new report is to be believed, Apple will use a Chinese supplier instead.

According to the report from Nikkei Asia, Luxshare is taking over the development team in Shanghai that was previously owned by Pegatron. This information was shared by five anonymous sources familiar with the matter.

The report refers to Apple's new products as augmented reality headsets, not mixed reality. However, it seems they are referring to the headset expected to be announced at WWDC, not a device like Apple Glass.

Pegatron had been working with Apple, the report states, but it has been on and off for four years. The company became skeptical about Apple's headset plans and exited the project to focus on other applications, according to a supply chain executive.

The shift to Luxshare isn't a complete surprise, as the company already helps build iPhones, Apple Watch, and AirPods.

Four people familiar with Apple's plans also shared that Foxconn would be developing the cheaper second-generation headset in parallel. The supplier will focus on automating mass production and improving production rates to help lower costs.

The report continues to explain the cost of parts being ordered by Apple, with displays running $150 for each eye, versus the $60 cost for each iPhone display. This is, in part, why the headset is estimated to cost between $3,000 and $5,000 -- an estimate shared before.

"Apple's first generation of AR devices will be extremely expensive, and really only can attract those passionate tech geeks or premium customers," an executive with knowledge of the development told Nikkei Asia. "But Apple hopes to push the price down in the second generation of devices, which is in parallel development, to a more affordable price, like a high-end Mac computer, and hopes to attract a bigger user base."

Apple is expected to reveal the mixed reality headset during WWDC in June. The first generation is expected to be expensive and focused on developer use.

Read on AppleInsider

Comments

  • Reply 1 of 8
    blastdoorblastdoor Posts: 3,434member
    Adjusted for inflation, the price range is ballpark similar to (maybe a little cheaper, actually) the cost of the least expensive Macs available in the early 90s. 

    In 1990, Apple sold about 1.3 million Macs (https://arstechnica.com/features/2005/12/total-share/7/). 

    At that time, Mac sales were almost entirely in the US alone (population at the time, 250 million). 

    Today the addressable market is much larger, BUT the Mac in 1990 was a known quantity with a well-understood value proposition, while this will be a new product that is unlikely to be viewed as a necessary purchase by the vast majority of people. 

    So.... I wonder if Apple might reasonably expect to sell about a million of these things in the first year, if that price range is accurate....


    InspiredCode
  • Reply 2 of 8
    chadbagchadbag Posts: 2,015member
    All I can say is “Good Luck”.   This looks to me like a product in search of a market.  Much like Zuck’s metaverse.  


    waveparticlemuthuk_vanalingamgrandact73
  • Reply 3 of 8
    badmonkbadmonk Posts: 1,320member
    or sell even less out of the gate.

    I suspect it will follow a course like the Apple Watch.  First it will be disparaged by the tech media and PC crowd, then Apple will flail a bit trying to define its core use, then it will take over.

    I still think spectator sports will be the thing that causes it to take off (and bolster Apple’s media efforts) as well as the usual suspects (a portable high end display for devs, gaming, porn, training, industrial use).

    Will see.  Interesting times.
  • Reply 4 of 8
    danoxdanox Posts: 3,111member
    No chance developing……… but making it based on a fully made Apple Prototype maybe.
    edited February 2023 FileMakerFeller
  • Reply 5 of 8
    Big difference between “develop” and “assemble.”

    and if so, I won’t be buying. It’s bad enough that Apple has given so much to the Chinese government. 
    FileMakerFeller
  • Reply 6 of 8
    Big difference between “develop” and “assemble.”
    A thousand times, this.

    Whoever or whatever is creating the headlines for this site's articles needs to develop a greater understanding of the technical meaning associated with words, and the anger it stimulates in the readership base when misuse occurs.

    Apple will NEVER hand off development of its products to a third party. They might work in partnership - for example, the third party may have information about the difficulty of manufacture for a particular request that Apple uses to change its design - but Apple retains control over product direction. We've already seen articles about BOE, a screen supplier, being taken to task by Apple because BOE changed the implementation without permission.

    If you're looking for a synonym for "assembly" or "manufacture" or "supply" in this particular instance, the word "fulfilment" is a much better option than "development."
    muthuk_vanalingam
  • Reply 7 of 8
    blastdoor said:
    Adjusted for inflation, the price range is ballpark similar to (maybe a little cheaper, actually) the cost of the least expensive Macs available in the early 90s. 

    In 1990, Apple sold about 1.3 million Macs (https://arstechnica.com/features/2005/12/total-share/7/). 

    At that time, Mac sales were almost entirely in the US alone (population at the time, 250 million). 

    Today the addressable market is much larger, BUT the Mac in 1990 was a known quantity with a well-understood value proposition, while this will be a new product that is unlikely to be viewed as a necessary purchase by the vast majority of people. 

    So.... I wonder if Apple might reasonably expect to sell about a million of these things in the first year, if that price range is accurate....


    The speculation I've heard is that Apple is aiming for like a million units of the first version. Honestly, that might be as many as they will be able to build due to specialty parts without an established supply chain. The Meta Quest 2 sold 10 million units in its first year according to analysts (no official numbers). I imagine the 2nd headset might aim for closer to those numbers.

    Personally I think that if Apple manages to build something that could be productive for both XR and non-XR software (like big high-res virtual desktops) they will sell a lot more then if this just ends up being a tech demo for a future that won't come for a few years. If they can do that, they might sell pretty easily because it is worth spending $3000 on something you use every day. Heck, I spent $7000 just on my monitors (two of them being Studio Displays) and probably close to $20000 altogether just on my current generation Apple devices just for me. I don't even want to know how much I've spent on Apple devices over the years. I'll be buying one and I'm sure there are a lot of others like me.
    edited February 2023
  • Reply 8 of 8
    danoxdanox Posts: 3,111member
    blastdoor said:
    Adjusted for inflation, the price range is ballpark similar to (maybe a little cheaper, actually) the cost of the least expensive Macs available in the early 90s. 

    In 1990, Apple sold about 1.3 million Macs (https://arstechnica.com/features/2005/12/total-share/7/). 

    At that time, Mac sales were almost entirely in the US alone (population at the time, 250 million). 

    Today the addressable market is much larger, BUT the Mac in 1990 was a known quantity with a well-understood value proposition, while this will be a new product that is unlikely to be viewed as a necessary purchase by the vast majority of people. 

    So.... I wonder if Apple might reasonably expect to sell about a million of these things in the first year, if that price range is accurate....


    The speculation I've heard is that Apple is aiming for like a million units of the first version. Honestly, that might be as many as they will be able to build due to specialty parts without an established supply chain. The Meta Quest 2 sold 10 million units in its first year according to analysts (no official numbers). I imagine the 2nd headset might aim for closer to those numbers.

    Personally I think that if Apple manages to build something that could be productive for both XR and non-XR software (like big high-res virtual desktops) they will sell a lot more then if this just ends up being a tech demo for a future that won't come for a few years. If they can do that, they might sell pretty easily because it is worth spending $3000 on something you use every day. Heck, I spent $7000 just on my monitors (two of them being Studio Displays) and probably close to $20000 altogether just on my current generation Apple devices just for me. I don't even want to know how much I've spent on Apple devices over the years. I'll be buying one and I'm sure there are a lot of others like me.
    If you had made a small 100 share purchase of Apple computer in May 2014 today you would have 400 shares after the 4 to 1 split, (58,400 market price today to 72,800 dollars the high-water mark) which would have allowed you to buy any Apple device, you cared to have, if price is a worry open up an account at Morgan Stanley and buy shares in Apple or any other blue chip stocks of your choice. (note: Apple does pay a dividend which would make the amount a little bit more). 

    Once you start money makes money once you get to a certain level, it’s like a fusion reaction of course that depends on making the right choice.
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