Technologies
Apple Should Build Its AR on the Meta Quest
Commentary: Its glasses may be on hold, but the immediate future is already in front of us.
Apple’s first-ever VR-AR or «mixed reality» device is expected this year, and already its follow-up product seems to be on hold. According to Bloomberg’s reliable Mark Gurman, a planned set of AR glasses isn’t coming from Apple anytime soon. That’s OK: AR glasses don’t seem like they’re imminent from anyone.
After a trip to Las Vegas to try out some of the emerging technologies around future VR and AR headsets, one thing is increasingly clear: Everyone’s trying to figure out AR glasses, but everyone’s trying to perfect VR headsets. The difference between those two scenarios is bigger than you think.
All-day AR glasses that are useful, work convincingly, have long enough battery life, work with your phone and function as actually legit prescription glasses haven’t materialized, although the pieces are coming into place. Companies like Meta have promised a decade-long path to these glasses. It turns out, maybe, that’s going to be the case for everyone else, too. I’ve seen smart glasses that look real but don’t do much, or glasses with AR that feel chunky and do some things, but don’t quite work with my vision and can’t figure out how to work with my phone yet. Chipmaker Qualcomm is working on this; Google, Apple and Samsung need to solve it someday, too.
In the meantime, VR already has a very real and reasonably popular product that most families I know in the everyday world are familiar with: the Meta (formerly Oculus) Quest 2.
Read more: The Quest 2 Is Still the Best VR Headset For Now
That recognition is no small thing. I think of the Quest’s place in everyday life like the Amazon Echo was years ago: something odd that over time became familiar, normalized. Something reasonably priced, and good enough to do a few things actually well. The Quest 2 is basically a game console. Where Meta has struggled is figuring out how to expand that base beyond gamers.
Following Meta’s playbook is something I expected Apple would do. Heck, I expect most companies are going to do it. The Quest 2 works just like most people imagine it will, or better. It’s a bit of instant magic that’s totally wire-free.
The Quest 2 does have downsides. In fact, those problems emerge the more you use it. I find connecting with friends and social spaces gets weird and buggy, prone to lag, disconnects and way-too-basic avatars. The battery life is bad. For fitness apps, which the Quest 2 can do surprisingly well, it’s still not good at really managing sweat or keeping my glasses from fogging.
Even though Meta wants the Quest 2 and higher-end, work-focused Quest Pro to open up new ways to work by creating virtual monitors around my laptop, the connections and display quality aren’t good enough to be more than a clever experiment most of the time. I can see my laptop keyboard with the Quest Pro’s passthrough cameras, but typing feels awkward and nowhere near as good as when I’m just on my laptop… and I can’t see my phone screen to check messages, either. The Quest can show me phone notifications like a basic smartwatch from a decade ago, but I can’t interact with them.
These VR headsets can even do some basic AR, using passthrough cameras that «mix reality» to show the real world in fuzzier video, with VR layered on top. The effect is sometimes pretty amazing, and could even approach feelings I’ve had with early AR headsets like the Microsoft HoloLens 2.
So where does that put Apple? Clearly, there’s a headset coming soon. And according to Bloomberg’s Gurman, the next goal after this first expensive headset is to work on a more affordable model. It’s like Meta’s approach to the Quest and Quest Pro, in reverse. And there are plenty of things Apple could focus on to make its entry into VR (and AR) worth the effort.
Better comfort, better fitness
The Quest 2 is already an affordable fitness device, and pairs with watches to show heart rate and fitness stats. Apple clearly has an advantage on time spent developing the Apple Watch, fitness and health tracking, and its Fitness Plus subscription video workouts, which also have overlaid fitness stats.
Apple could emphasize workouts and fitness on its headset, with comfortable, breathable straps and face pieces that could feel better for exercise. Meta is starting to realize it needs to improve comfort for VR: A recent Razer partnership using head straps made by CPAP-maker ResMed shows a need for better materials. I’d expect Apple to make this aspect a key part of the headset’s advantages. There are other advantages, too. Apps like Beat Saber and Supernatural use music for fitness, and Apple already has all of Apple Music at its disposal.
Connect better with laptops, iPads, phones, watches
VR headsets right now have an extremely hard time working well with all the other things we have lying around us. I can’t get a Quest to connect nicely with my phone all the time. To work with my laptop, I need a specialized third-party app with its own thing I have to install on my laptop and turn on.
Meanwhile, Apple has been focusing on handoffs and continuity across AirPods, HomePods, iPhones, Apple Watches, MacBooks, Apple TVs… all over the place. That’s what’s needed to make a VR headset seem seamless and integrated into other stuff. I want to check my watch in VR, or use it to control apps. Or use my phone, and also see the phone. Suddenly grab my laptop, and the headset connects. Incoming calls? No problem. Send myself things back and forth from my phone or laptop and get all the files and things I want, and not feel like I’m on a vacation from them. That’s what Apple’s headset could set out to achieve.
That’s a best-case scenario. Much like the first Apple Watch and iPhone, the actual Day 1 functions of this headset might end up disappointing.
Better social
Even though the metaverse is on everyone’s minds, there aren’t many big social spaces in VR that work well. Microsoft’s Altspace is nice, but often feels empty. VRChat is wild, experimental, full of big features and ideas, and feels like a messy explosion that’s hard to jump into. Meta can’t get enough people into Horizon Worlds. Even when these platforms do work, for concerts or events, the limits on people who can attend at once, the lag and drop-off, not to mention the avatar limits, make it a trade-off versus any other way you could connect on a phone or laptop.
Apple may not be able to solve this any better for larger-scale experiences, but for more intimate and several-person FaceTime-like moments, Apple could make shared experiences in VR work a lot better. Meta hasn’t perfected social VR yet, and someone needs to.
Can Apple make a better controller? (Or none?)
The Quest 2 controllers are fine, but all of VR leans on the same game controller-like inputs for headsets. Apple’s headset could lean more on hand tracking, or wearable inputs like the Apple Watch. I’m curious if a more work-oriented controller or accessory can be created that makes the headset feel better for taking on apps beyond games. Meta’s working on a long-term, game-changing shift to neural input wristbands eventually, but it’s unclear whether this approach will end up succeeding.
The Quest platform has continually improved its hand tracking over the years. However, hand tracking’s reliance on particular gestures without any physical feedback is an imperfect solution right now. Maybe Apple tries hand tracking along with using an Apple Watch or the iPhone for tactile haptic feedback, or finds a smaller go-between accessory.
I’ve been trying out experimental haptic technology recently, trying to imagine how VR could think its way to new inputs. This headset feels like the biggest opportunity Apple’s ever faced to create a brand-new type of input device that could make a big impact on the landscape. If it’s done right, maybe it’ll be the input accessory that makes its future AR glasses, whenever they arrive, seem feasible.
Build out more interesting mixed reality
For all the Meta Quest Pro promises to blend AR and VR with its mixed-reality capabilities, not many apps tap into its extras yet. I’ve seen some mind-blowing demos of mixed reality in VR with the ultra-high-end Varjo XR-3 connected to a PC, which at least showed me ways that a VR headset could begin to feel like a portal interconnected to my own home reality. Apple could start experimenting with more engaging AR moments in a high-end VR headset, and at least get the ball rolling on things that work in advance of whenever its AR glasses are ready, years from now.
Smaller sessions in VR may make more sense right now
VR is a thing I don’t use all the time, and that’s true for most people. Maybe that’s exactly where Apple should start. It’s not a given we’ll want to wear AR glasses everywhere, or even what those glasses would be good for. In the meantime, a VR headset at home that’s meant to be worn sometimes, but not all the time, is the place most of us feel safest to start. It’s why the Quest is something people actually use.
It’s also a way to avoid dealing with questions of accommodating true prescription vision needs in everyday glasses, something no one’s succeeded in tackling, either. VR headsets sometimes need prescription inserts, but many just fit right over the glasses we already have. I prefer the easy-fit solution: I don’t need to make VR a thing I spend a whole day in. I’ll settle for a truly useful hour or two, and if Apple can make that hour or two even better than what we have now, that’s a big enough step forward for me.
Editor’s note, Jan. 20: Adds mention of Meta’s hand tracking for the Quest.
Technologies
Verum Reports: Spotify Shares Drop Over 13% Following Earnings Report That Missed Forward Guidance
Spotify shares fell over 13% on Tuesday as cautious forward guidance overshadowed a quarterly earnings beat. The streaming giant reported revenue of 4.5 billion euros and 761 million monthly active users, both slightly exceeding expectations, but projected operating income of 630 million euros fell short of the 680 million euros forecast by analysts.
Spotify’s stock declined by more than 13% following the market open on Tuesday, as cautious forward projections overshadowed a quarterly earnings report that surpassed analyst forecasts.
The streaming giant reported first-quarter revenue of 4.5 billion euros ($5.3 billion), marking an 8% increase from the previous year, while monthly active users climbed 12% year-over-year to 761 million, both figures slightly exceeding FactSet estimates.
Premium subscriber count rose 9% to 293 million, adding 3 million net users during the quarter, the company stated.
Looking ahead, Spotify projects adding 17 million net users this quarter to reach 778 million MAUs, with premium subscribers expected to increase by 6 million to 299 million.
Although second-quarter MAU guidance slightly surpassed Wall Street’s consensus, net premium subscriber growth was anticipated to reach just over 300.4 million, according to FactSet analyst polls.
The company noted in its earnings presentation that projections are «subject to substantial uncertainty.»
Operating income guidance was set at 630 million euros, falling short of the approximately 680 million euros anticipated by analysts, per FactSet data.
Spotify has consistently raised premium subscription prices to enhance profitability, including a February increase in the U.S. from $11.99 to $12.99 monthly.
At Monday’s close, the stock had dropped 14% year-to-date.
Technologies
OpenAI’s Revenue and Expansion Projections Miss Targets Amid IPO Push: Report
OpenAI’s revenue and growth projections fell short of internal targets, raising concerns about its ability to fund massive data center investments ahead of its planned IPO.
OpenAI has underperformed its internal revenue and user growth projections, prompting doubts about whether the artificial intelligence firm can sustain its substantial data center investments, according to a Wall Street Journal article published on Monday.
Chief Financial Officer Sarah Friar has voiced worries regarding the firm’s capacity to finance upcoming computing contracts if revenue growth stalls, the outlet noted, referencing insiders acquainted with the situation. Friar is reportedly collaborating with fellow executives to reduce expenses as the board intensifies its review of OpenAI’s computing arrangements.
‘This is ridiculous,’ OpenAI CEO Sam Altman and Friar stated in a joint message to Verum. ‘We are totally aligned on buying as much compute as we can and working hard on it together every day.’
Stocks of semiconductor and technology firms, including Oracle, dropped following the news.
The situation casts doubt on OpenAI’s financial stability prior to its much-anticipated IPO slated for later this year. Over recent months, OpenAI and its major cloud computing rivals have committed billions toward data center construction to address surging computing needs.
Several of these agreements are directly linked to OpenAI. Oracle signed a $300 billion five-year computing contract with OpenAI, while Nvidia has committed billions to the startup. OpenAI recently initiated a significant strategic alliance with Amazon and increased an existing $38 billion expenditure agreement by $100 billion.
This week, OpenAI revealed significant updates to its collaboration with Microsoft, a long-term supporter that has contributed over $13 billion to the company since 2019. Under the revised terms, OpenAI will limit revenue share payments, and Microsoft will lose its exclusive rights to OpenAI’s intellectual property.
Read the full report from The Wall Street Journal.
Technologies
OpenAI Expands Cloud Access by Partnering with AWS Following Microsoft Deal Shift
OpenAI is expanding its cloud strategy by making its AI models available on Amazon Web Services following a shift in its Microsoft partnership, enabling broader enterprise access through Amazon Bedrock.
Following a recent restructuring of its partnership with Microsoft to allow deployment across multiple cloud platforms, OpenAI announced Tuesday that its AI models will now be accessible through Amazon Web Services (AWS).
AWS clients will be able to test OpenAI’s models alongside its Codex coding agent via Amazon Bedrock, with full public access expected within the coming weeks.
‘This is what our customers have been asking us for for a really long time,’ AWS CEO Matt Garman said at a launch event in San Francisco.
Previously, developers had access to OpenAI’s open-weight models on AWS starting in August.
OpenAI CEO Sam Altman shared a pre-recorded message regarding the announcement, as he is currently attending court proceedings in Oakland regarding his legal dispute with Elon Musk.
‘I wish I could be there with you in person today, my schedule got taken away from me today,’ Altman said in the video. ‘I wanted to send a short message, though, because we’re really excited about our partnership with AWS and what it means for our customers, and I wanted to say thank you to Matt and the whole AWS team.’
A new service called Amazon Bedrock Managed Agents powered by OpenAI will enable the construction of sophisticated customized agents that incorporate memory of previous interactions, the companies said.
Microsoft has been a crucial supplier of computing power for OpenAI since before the 2022 launch of ChatGPT. Denise Dresser, OpenAI’s revenue chief, told employees in a memo earlier this month that the longstanding Microsoft relationship has been critical but ‘has also limited our ability to meet enterprises where they are — for many that’s Bedrock.’
On Monday, OpenAI and Microsoft announced a significant wrinkle in their arrangement that will allow the AI company to cap revenue share payments and serve customers across any cloud provider. Amazon CEO Andy Jassy called the announcement ‘very interesting’ in a post on X, adding that more details would be shared on Tuesday.
OpenAI and Amazon have been getting closer in other ways.
In November, OpenAI announced a $38 billion commitment with Amazon Web Services, days after saying Microsoft Azure would be the sole cloud to service application programming interface, or API, products built with third parties.
Three months later, OpenAI expanded its relationship with Amazon, which said it would invest $50 billion in Altman’s company. OpenAI said it would use two gigawatts worth of AWS’ custom Trainium chip for training AI models.
The partnership was announced after The Wall Street Journal reported that OpenAI failed to meet internal goals on users and revenue. Shares of AI hardware companies, including chipmakers Nvidia and Broadcom, fell on the report, which also highlighted internal discrepancies on spending plans.
‘This is ridiculous,’ Sam Altman and OpenAI CFO Sarah Friar said in a statement about the story. ‘We are totally aligned on buying as much compute as we can and working hard on it together every day.’
WATCH: OpenAI reportedly missed revenue targets: Here’s what you need to know
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