Blue Whale News, June 19th (Reporter Zhang Han) According to Silicon Valley technology media "The Information" on June 18th, a supplier of key components for Vision Pro said that Apple has told at least one supplier to suspend work on the next generation of high-end headsets. Analysts and supply chain partners have indicated that sales of the $3500 Vision Pro are slowing down. According to supply chain sources cited in the report, Apple will strive to release head display devices with fewer features and more affordable prices by the end of 2025.
Vision Pro is a groundbreaking product released by Apple CEO Tim Cook since he took the helm. However, after its launch in the United States in February, the market response to Vision Pro was far less popular than other Apple products before, with independent critics criticizing its lack of content, poor comfort, and limited usage.
At the just concluded WWDC, Cook placed the update to visionOS 2 first, with the core change being that ordinary 2D photos in the iPhone gallery can be converted into 3D spatial images with a deep and natural feel. In addition, visionOS 2 has also introduced gesture touch function and so on. Cook wants to solve some user experience issues through system updates.
Apple still chooses to expand the sales range of Vision Pro. Starting from June 28th, Vision Pro will be officially released in mainland China, Hong Kong, Japan, and Singapore; Starting from July 12th, it will be released in Australia, Canada, France, Germany, and the United Kingdom. Nevertheless, Apple did not have much expectation for its sales. The Information quoted a supplier from Vision Pro stating that due to receiving Apple's forecast of weak demand in August, production was cut in half in May of this year.
Since the release of Vision Pro, its high price and product experience have not lived up to Apple's vision of telling a new story. In its latest financial report for the second quarter of the 2024 fiscal year (the first quarter of the 2024 calendar year), Apple did not disclose the specific sales of the Vision Pro, but instead used the statement that half of the Fortune 100 companies have already purchased Apple's Vision Pro product as a platform. In hardware products, except for Mac, which maintained a positive year-on-year revenue growth, iPhone, iPad, wearable, smart home, and accessories all experienced a year-on-year decline. Renowned Apple analyst Guo Minggui predicts that Apple has significantly lowered its expected orders for the product this year, from the initial 700000 to 800000 units to 400000 to 450000 units.
Apple has made several major strategic changes this year. On February 28th, according to Bloomberg reporter Mark Gurman, after ten years and billions of dollars of effort and investment, Apple has abandoned its electric vehicle project in competition with Tesla, and some employees will shift to generative artificial intelligence teams.
On WWDC, Apple showcased its "Apple Intelligence" to the outside world. This helps to address doubts about Apple's slow AI layout. In this wave of AI, the biggest beneficiaries, Microsoft and Nvidia, have successively surpassed Apple in terms of market value.
Now, Apple will launch a cheaper head display product.
According to The Information, Apple has been researching a cheaper Vision Pro product internally since 2022, codenamed N109. Apple hopes this version will be as affordable as a high-end iPhone, with a retail price of around $1600, and plans to release it by the end of 2024. But according to a person involved in the manufacturing, as of earlier this year, a suitable model has not been found, and Apple has been working hard to reduce the cost of the model without losing too much functionality. This means that the release date of the product will exceed the revised release date at the end of 2025.
Apple hopes to obtain more affordable models to retain the high-end displays of Vision Pro, and Sony has always been the only supplier of Vision Pro displays. But Apple has been collaborating with Chinese company Seeya Technology to produce cheaper displays next year to replace Sony's displays. Shiya has been striving to meet Apple's standards so far, although this effort may fail.
For the lukewarm AR/VR market, Apple's suspension of high-end headsets will also have a certain impact on the industry.
On June 19th, according to foreign media reports, Andrew" Boz" Bosworth, Chief Technology Officer of Meta, announced the largest hardware department restructuring since its renaming to Reality Labs in 2020. All teams in Reality Labs are merged into two groups, a central "Metaverse" organization, including the Quest headset series; Another is the new wearable device organization, which includes Meta's other hardware work, including the smart glasses launched in collaboration with Ray Ban. Prior to this, Meta cancelled its production plan for a more expensive Quest headset in January 2023 after seeing weak sales of the $1500 Quest Pro.
The release of Apple Vision Pro has also accelerated consumer awareness of AR/VR in the Chinese market. Rokid founder Zhu Mingming previously stated in an interview with media outlets including Blue Whale News that everyone is looking for the next era after the iPhone. The current milestone is more like the first three years of the iPhone's release, not in terms of technology, but in terms of mentality. Everyone is trying, and Apple has not found a clear moment. For the AR/VR market, whether in technology or supply chain, it has not yet reached a mature level.
After Apple releases more affordable products, the entire AR/VR market may usher in a new round of changes. According to a report by market research firm Counterpoint Research, it is estimated that the global shipment of Extended Reality (XR) headsets will reach 3.9 million units in 2024, achieving double-digit year-on-year growth.