Ming-Chi Kuo: Investors should be cautious about Apple Vision Pro launch hype
TF Securities analyst Ming-Chi Kuo is cautioning investors about the hype surrounding the Apple Vision Pro launch, saying that if the headset doesn't sell out at first, it may be a longer road to success than anticipated.
Apple Vision Pro at Apple Park
On Monday, Apple confirmed the release date of the Apple Vision Pro will be February 2 in the United States. After the announcement, Apple observer Ming-Chi Kuo told investors to be cautious about the launch and their expectations for success.
In a Medium post early on Tuesday, Kuo initially says that Apple did showcase the technology well at its introduction, but "left out more important information about the product's position and key applications."
If Apple could offer more information in these areas, Kuo writes, "it would help maintain sales momentum and attract more developers."
Kuo reckons that hype for the headset should mean the Apple Vision Pro will sell out after pre-orders open or when it goes on sale, in turn lengthening shipping times. However, if it doesn't, Kuo believes "Vision Pro may take longer to become a success, which would be detrimental to the short-term stock price performance of Apple and its supply chain."
There is praise for the specifications and software being "well above the industry average," which should earn "high praise" from users. Kuo then warns that the novelty and demand could wear off "depending on whether Vision Pro's product positioning and key applications are clear and correct."
It's not clear why Kuo holds this viewpoint. The Apple Watch was not an incredible success at launch, and it took an iteration or two to capture the market. Apple clearly has the money to wait out a less-than-successful product at launch, and has done so with Apple TV+ and the re-release of the larger HomePod.
Read on AppleInsider
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him: “…which would be detrimental to the short-term stock price performance”. He’s giving investors advice - see your own title!
if you’re going to go back to Apple Watch and Apple TV, make it relevant and tell us if AAPL stock was not affected in those cases.
8 of 9 professional reviewers got tired within 20 min. of use. And those were assisted by trained Apple employees for a perfect fit.
This is the best part of the article - Kuo then warns that the novelty and demand could wear off. That is exactly what is going to happen. The novelty will wear off and people will go back to using their iPad to run the iPad apps (VisionPro runs iPad apps) and watch their big screen TV to watch movies. And the battery only lasts about 2 hours. That is the reality. The majority of consumers are not going to spend $3500. Maybe that is why it is $3500, because it has 16GB of RAM, and Apple cannot even ship Macs with 16GB of RAM as the standard config.
It will be interesting to watch this launch. Remember iPod Hi-Fi? That was $349 and no one bought it.
Yes, I own one of the iPod Hi-Fi is a great product still works like a charm like those Cinema Displays from the same era still work great too.
https://www.youtube.com/watch?v=8c3_D8tt14s
https://www.youtube.com/watch?v=CgX2RZkpqbQ
The MacBook Pro isn't a mainstream (marketshare) laptop and the Apple Vision Pro won't be mainstream either but what it will be is the dominate product at the top end of the market like most of the Apple devices. It will be the best in class by a wide margin software/hardware wise. ie like the M3 Max MacBook Pro 128 GIG UMA, iPad Pro, Apple Watch, Apple Silicon (UMA Memory whose significance will get bigger), and iPhones year after year.
Every product has to be applicable towards an actual need, do I believe there is one?
Business:
Inexpensive trackers that are visible in space would make inventory easier, if the trackers can hold information and interface with other rfid chips, even better. (Apple has bought a company that was doing x-y map coordinate markers for web-like content) This function could be done without trackers I guess.
Meetings, this one is up in the air. It SHOULD work… But I would give it some time to mature.
Games?
Cheaper games as opposed to FB expensive ones, should be a draw, if no cheaper games… Then Apple arcade might see a use. No G5 modem likely means some will try Pokemon Go or similar games with a mobile router. I am guessing a proper pokemon Go wont come until AVP is truly mobile.
I think the price is as it is to curb demand, also to position the Apple Vision PRO in a Pro pricerange (nothing pro about the ssd size of 246gb though..) Will it see enough adoption? My guess is that it likely wont see a huge lineup of people, aint no reality distortion field active and the economy is soso…
I hold the belief that this is an interim release to blow new life into AR and position for the near-mid term of tech breakthroughs and development, and it already succeeded there… It lifted facebook/meta stock up to pre-meta debacle leves, as I was sure it would. Tons of tech companies are positioning to be in the much desired opposition to Apple. In short, AR/VR is buzzing with investor money and re-newed development. (Not even Apple can start a product from complete scratch. They need a supply-chain to exist)
I am not sure Apple will succeed ofc, but I have no doubt that just the fact that Apple has entered the lobby is a landmark step towards a successful AR/VR future. For me personally, I have followed the Oculus story from the start, Apple made small good quality displays cheap enough for that to become a thing, and now we come full circle. Its cool. I have loved sterescopic stuff since I was a kid in the 90ies, and donned those huge VR goggles and played that wonky VR ptraodactyl game.
I think there will for sure be usecases that are superiour to a 2d screen. Just on the quest 2 there is a painting app that is quite frankly amazing. Just hold for a M3/M4 release in a couple years, that one will be the real deal.
So, it doesn’t matter if AVP is a hit out the gate.. It has done the job it needed to do. It is in essence a dev platform and a pr move.
Smartphones have nowhere else to go, Apple silicon is loosing its advantage because there is no need for more powerful soc’s for the small 2d screen on mobile. With AR, there is room to grow and Apple regains their AS advantage and incentive to improve their soc’s.
I think the big questions are how fast this can be adopted or whether it will be successful with a very narrow target audience. iPhones are for everyone which is why this is the foundation product for the company. After that you quickly get into a funnel of customers. Laptops, tablets, smartwatches, not everyone needs these. Apple can make it relevant by showing us more ways we can use it for work, meetings, catching up with others. If it helps with productivity, if there's a network effect then it's going to attract more interest.
So many factors go into deciding how many of a thing to make in its initial production run, that whether that initial run sells out or not is profoundly meaningless. The fact that Kuo is making projections based on that meaningless data point just shows how full-of-crap he is.
(1) Apple in 1993 was as big and profitable as Microsoft and Intel (as they were then) combined.
(2) Apple released the Newton MessagePad, but with the hardware specs of the MessagePad 2000 and at twice the original price
If that happened, then I think the Newton would have gone on to be a success. The initial model would have had the tech specs to do the job it was supposed to do, so it would have made a much better first impression. The high price would have kept sales low for a while, but that would have given Apple time to refine the device based on feedback from a small but enthusiastic group of early adopters. And with financial stability, Apple could have been patient waiting for profits while continuing to refine the product.
I wonder if that will be the story for VisionPro.
I don’t think the device needs a “killer app” to be successful. Given that users will have access to a large library of existing apps and content, they will be able to experience them in a spatial environment.
If only 1% of iPhone users purchases this product, that would be over 15m units.
Also, Apple Watch didn't cost $3,500, but it did cost quite a lot more than the fitbits people were were comparing it to as they said 'nobody wears a watch anymore, and they're certainly not going to pay that much to start wearing one now.' As far as the watch's release being an analog to the Vision Pro, one could consider that at release the peanut gallery can't imagine what either would actually do or why anyone would want one, and that in a couple of years there will be retroactively obvious use cases for it, and that people who might've had a ~$1,000 price-point threshold at the Vision Pro's release (and taken a pass) will willingly pony up the higher asking price in two or three years. (The folks who are thinking $300 will still sit it out, but they were never the target audience anyway.)