The price of Vision Pro is plummeting, is Apple worried?

Vision Pro has been on the market for some time. Although it has not been launched in China yet, it is already available for purchase on multiple platforms.

However, its price has dropped from the original sky-high level to be similar to the American market.

From the original expectation of igniting the XR market to the current market downturn, people are starting to doubt whether the Vision Pro will become a failure for Apple. However, some recent actions by Apple seem to indicate that they have a new business plan for the Vision Pro. The device, which costs 20,000, is not intended for individual consumers to foot the bill.

01 Apple's To B Plan

In the early stages of the Vision Pro launch, the main criticism was the lack of compatible applications. Even though the device's performance is excellent, the usage scenarios for individual consumers are limited. Some users pointed out, "It's not that Vision Pro is unaffordable, but it just doesn't offer good value for the money." The lack of killer applications has caused the once highly priced product to see a significant decline in sales, with reports indicating a sharp drop in Vision Pro trial reservations at Apple retail stores. Some stores have seen their sales plummet from a daily average of several units to only a few units per week.

Analyst Ming-Chi Kuo stated that Apple is reducing the shipment volume of the Vision Pro in 2024 and reconsidering the plan for the next model. According to him, Apple has now set the shipment target for this year's Vision Pro at 400,000 to 450,000 units, a decrease from the initial market expectation of 700,000 to 800,000 units.

In response to the relatively negative market reaction, Apple seems to be looking to open up a new market through To B business. In fact, Apple's developers have been building applications for the Apple Vision Pro in various enterprise categories, ranging from business productivity and product design to immersive training and guidance work.

In February 2024, Microsoft 365 also launched applications for the Vision Pro, allowing users to smoothly use Microsoft Word, Excel, PowerPoint, Outlook, Loop, OneNote, and the iPad version of Teams on the Vision Pro.

The specific functions include: creating and editing documents, presentations, and spreadsheets; sharing, collaborating, and real-time cooperation; using Microsoft Copilot to create, edit, and chat; as well as participating in and hosting meetings or chatting with friends, family, and colleagues. Although I don't understand the fun of "immersive" office work, the functionality of online meetings is exactly the vision of the metaverse concept that was popular a long time ago.

At the same time, SAP Analytics Cloud also announced its landing on the Apple Vision Pro App Store.

In March 2024, NVIDIA announced its landing on the Vision Pro App Store. NVIDIA will introduce the industrial scene Omniverse enterprise digital twin based on OpenUSD, and developers can transfer a large amount of 3D engineering and simulation data sets from the cloud to Vision Pro. Rev Lebaredian, NVIDIA's vice president of simulation, said, "Apple Vision Pro is the first unconstrained device that allows enterprise customers to achieve their work without compromise." "We look forward to our customers being able to use these amazing tools."

The above examples mainly demonstrate the application of Vision Pro in the B2B field. In contrast, the cooperation between Porsche and Vision Pro seems relatively "leisurely." In March 2024, Cook and Porsche CEO Oliver Blume "connected" to demonstrate the cockpit application provided by Vision Pro for the new Taycan electric car. However, this application is obviously not for the driver to use, but it allows users to view track lap times, related data statistics, and 3D track maps from a first-person perspective. From the displayed images, this program looks more like an immersive racing viewing program.

However, consumers are not expecting to be surrounded by office software. At one time, Vision Pro was given XR devices that could change the entertainment experience, and it was believed that Apple would finally start the XR landing moment. However, there is still no killer software that can ignite Vision Pro sales since its launch.

Although there are a large number of office software, users' biggest expectation for Vision Pro is still entertainment.

A Vision Pro user pointed out that the most common scenario he currently uses Vision Pro for is entertainment. Some users have stated that Vision Pro is the best video viewing device they have used, and they experienced a strong sense of immersion when watching "Echo" on Disney+ and "Dickinson" on Apple TV+ through Vision Pro. The theater mode of these two applications is already close to a real cinema. Even compared to a 65-inch TV screen, Vision Pro performs better in fidelity and immersion.

However, for productivity, users believe that although the performance of virtual displays is impressive, typing with Vision Pro is quite difficult. While Vision Pro's sensors can capture user eye movements, it is actually quite blurry for typing. For users, using a browser and email on a phone or computer is more convenient.

For ordinary consumers, the price of Vision Pro is still relatively high, even the relatively cheaper Quest 3 is priced at around 3646 yuan.

People want innovation; they want the next generation iPhone. The traditional view is that innovation lies in hardware, which is reasonable. However, those who are more geeky than most people will definitely think that software can be the most important aspect of any technological product.

The popularization of XR devices in the consumer market has always faced many challenges. Earlier, in order to promote the concept of the metaverse, Facebook changed its name to Meta, but the effect was not significant. Recently, Meta made an important decision to adopt a united strategy and open its Meta Horizon OS to third-party manufacturers. This move is seen by the outside world as a key move that may reshape the VR, AR, and metaverse market. If successful in building a large developer ecosystem, Meta is expected to become a leader in the VR and metaverse era after Microsoft in the PC era and Google in the mobile development era, creating the "Android" operating system in the VR field.

According to the official announcement, Meta Horizon OS is the result of Meta's ten years of efforts to build the next-generation computing platform. Opening this system means that more people will benefit from it. After ten years of research and development, Horizon OS has integrated many self-developed technologies of Meta, including inward-out tracking and self-tracking controllers. Inward-out tracking technology can accurately capture the user's hand and finger movements, achieving more natural operation and interaction. The self-tracking controller allows the device to automatically track the user's hands or other body parts, providing users with a smarter and more flexible interface control.

In order to achieve a more natural interaction system, Meta has also developed hand, eye, face, and body tracking technologies. In terms of mixed reality technology, Meta has developed a set of technologies that integrate the digital and physical worlds, including high-resolution penetration, scene understanding, and spatial anchors. With the opening of Horizon OS, several technology companies have adopted this operating system. According to the official announcement from Meta, Asus' Republic of Gamers will use Horizon OS to develop high-performance head-mounted gaming devices. Lenovo, with its rich experience in Oculus Rift S and ThinkPad laptop series, is developing mixed reality devices for productivity, learning, and entertainment.

Last year, Xbox and Meta cooperated to introduce Xbox Cloud Gaming (Beta) to Meta Quest, providing users with a new experience of playing Xbox games on a large 2D virtual screen in mixed reality. Now, the two companies are once again working together to create a limited edition Meta Quest inspired by Xbox. This move is expected to further promote the popularization and development of XR devices in the consumer market.

In the consumer market, while the giants have not yet conquered, some more popular products have made a small attempt.

Due to the introduction of lower-priced AR glasses products by companies such as Xreal and Rokid, the AR market is also expected to grow in 2024. These glasses often serve as alternatives to displays, while also improving productivity or enhancing the media consumption experience.

On April 22, Rokid officially launched its new product, the AR Lite spatial computing suite. The suite includes a lightweight display terminal, Rokid Max2 glasses, weighing only 75 grams, and a Rokid Station 2 host that integrates sensing, computing, and battery modules, which can be held and operated with one hand.

According to the on-site display, Rokid AR Lite has a variety of functions, such as mobile light office work, immersive large-screen games, viewing experience, and fast screen casting for computers and mobile phones. In terms of interaction, Rokid AR Lite has been innovatively upgraded, canceling the original front physical buttons and adding multi-finger and multi-gesture touch functions, allowing users to seamlessly connect to the interaction mode on mobile phones and tablets. Rokid has not disclosed the specific price information of AR Lite. According to industry insiders' general speculation, its price may be within 3000 yuan. This price range makes Rokid AR Lite competitive in the market.

These XR devices can achieve affordable prices, mainly due to the different technologies they adopt compared to Apple. The perspective function of XR devices is mainly based on two technological paths. One is VST (Video See Through), which captures the image of the real world through sensors such as cameras and projects it onto the screen to bring users a more immersive experience. For example, Apple's Vision Pro and Meta's Quest VR devices use this technology. The other is OST (Optical See Through), which interacts with the real world through camera positioning and chip calculation, and is common in AR devices. This is also the technology route chosen by domestic AR glasses head manufacturers such as Rokid, Xreal, Rokid Innovation, and INMO.

VST and OST each have their own advantages and disadvantages. Since VST requires the construction of an immersive and digital physical world, the device volume is difficult to achieve lightweight, which is one of the reasons for the high prices of products such as Vision Pro and Quest. In contrast, OST does not require the reconstruction of the physical world, so it has the advantage of being lightweight and comfortable, but it is difficult to achieve deep immersion. The reason Apple chooses VST is that this technology can fully leverage its advantages in chips, operating systems, supply chain integration, and product pricing capabilities. Obviously, for the consumer market, OST is undoubtedly the more suitable choice at present.

The popularization of consumer electronics products cannot be separated from the two major scenes of gaming and social interaction, and achieving fragmented social scenes is crucial. When AR glasses can have convenient fragmented functions, they are expected to achieve explosive growth in multiple scenes in the short term. However, the premise of this process is that key materials such as optics, batteries, computing power, and communication must undergo technological changes. This process may take 3 to 5 years to complete. Of course, a low price does not mean that it cannot enter the to B field. Many AR manufacturers regard the enterprise end as an important experimental field for technology and market.

The iPhone moment of the XR industry

The development stage of the XR industry is similar to the intelligent smartphone industry in 2007. Many companies are exploring the direction of the next generation of products, and this industry needs a groundbreaking product. Apple's Vision Pro may become such a product.

Regardless of the answer, at least this product has driven the entire industry. Rokid founder and CEO Zhu Mingming said in an interview that after the release of Vision Pro, Rokid's sales and developers have experienced several times growth.

According to data released by CINNO Research, the total sales of domestic consumer-grade AR devices in 2023 reached 227,000 units, achieving significant growth year-on-year. Although the sales volume has increased, from the overall shipment volume, AR glasses have not yet fully entered the mass market. However, Rokid predicts that the shipment volume of AR Lite is expected to reach 300,000 to 500,000 units in 2024, which is already equivalent to the annual sales volume of a flagship smartphone. If this prediction is realized, it undoubtedly marks an important step in the popularization of AR glasses in the market. Compared to Vision Pro, AR glasses are more like a screen, and they have more advantages in terms of price and ecology. Perhaps for Apple, cost-effectiveness has never been its pursuit, but ecological issues should be its first task.

The XR industry is gradually experiencing a revolutionary moment similar to the smartphone industry, where Vision Pro is facing a transformation from simple device innovation to application innovation, and then integrating into more scenarios.

Apple created the iPhone moment in the smartphone industry, can it create the iPhone moment in the XR industry?