On Tuesday, Magic Leap, a well-known AR glasses developer in the industry, made a low-key announcement: The company provided the next generation of AR glasses Magic Leap 2 to four medical partners in advance: Clinical Data Visualization Company SentierAR, Neurotechnology Company SyncThink, Diagnostic Company Heru and Surgical Software Company Brainlab.
With neither new technology announced nor new equipment coming out, the sudden outburst of such an innocuous message seems somewhat strange to the outside world. The mystery may be related to the fact that the company has just announced that the Magic Leap 2, which was scheduled to be available in the fourth quarter of 2021, will be postponed to mid-2022.
1. Magic Leap in the clouds
In the past year, magic leap company valuation plummeted, new products are difficult to produce, a large number of executives left, Magic Leap's embarrassment has long been known, the extension of Magic Leap 2 is just the old hatred, and then add new worries. But the work that should be done is still to be done, as a strategy of Magic Leap's self-grooming, releasing positive news to stabilize public opinion at this time is also an account for investors.
Looking back at the development history of Magic Leap, it was founded in 2011 early, but it was not until December 2017 that the first product Magic Leap 1 was launched, and the cumulative financing has exceeded 3.5 billion US dollars so far, and the investors include Google, Alibaba, Qualcomm, Warner, Morgan Stanley, etc., but after experiencing the 2020 layoff storm and the founder leaving office, the current valuation is only about 2 billion US dollars.
And that's not all, magic Leap executives have been leaving frequently over the past year, with Chief Product Officer Tracey Trewin, Chief Software and Cloud Manager Anuj Gosalia, Cloud Product Head Randall Hand, Software and UI Director Yannick Pellet, Technical Director Paul Greco, Chief Operating Officer Henk Vilestra and Chief Patent Officer David Lundmark all leaving.
Peggy Johnson
It is worth mentioning that the departing chief product officer Tracey Trewin has been with Microsoft for 25 years, while the newly appointed CEO Peggy Johnson is a former senior technical executive of Microsoft, and Microsoft has become a Magic Leap fire brigade and talent reserve base.
2.AR industry is difficult to brother
Magic Leap is already miserable, and there are executives willing to jump from the Microsoft team, which shows the fact that the Microsoft team is even more miserable. According to the Wall Street Journal, Microsoft's AR team has lost more than 100 employees in the past year, of which 40 people have jumped to Meta, including Charlie Han, former Director of User Feedback at HoloLens, and Josh Miller, former member of the HoloLens demo team.
Military version of holoLens
Deep down, Magic Leap and Microsoft are the first batch of enterprises to enter AR, in 2015 Microsoft launched the AR headset HoloLens, two years later the competitor Magic Leap 1 was born, these two products are for the B-end market, Microsoft even snatched a large military contract from Magic Leap to develop a HoloLens AR system for combat and training for the U.S. Army.
However, from the later results, even for the B-end market, the road forward for AR companies is still arduous. It is estimated that the Shipment of HoloLens is about 200,000 to 250,000 units, and magic Leap 1 has only sold 6,000 units in half a year, compared with the VR headset Oculus 2, which has accumulated tens of millions of sales at Meta next door, the dismal situation of AR companies may not be just the reason for business operations.
According to statistics, in 2020, the global shipment of virtual reality terminals will be about 6.3 million units, the shipment volume of VR terminals will account for 90%, the proportion of AR terminals will be only 10%, and the shipment volume will be about 630,000 units. Obviously, the entire AR industry, whether it is the B-end or the C-end, there is not enough demand to support the market, and the spring that belongs to AR has not yet arrived.
3. The coldest moment before spring
IDC in 2019 had expected that by 2022, the overall shipment of AR/VR would reach 66 million units; of which AR products would account for about 40% of the AR/VR market; and in the future, with the maturity of AR technology, the unit price of AR products will decline, and the AR market will usher in a new outbreak, and the global AR market will grow at an average annual compound growth rate of more than 69%. By 2024, the global augmented reality industry market size will reach 287.2 billion yuan.
Now it seems that IDC's 40% data is obviously too optimistic, but from the past year there have been AR products worldwide, and in 2022, there are giants such as Apple and Sony that will also release AR glasses, and the next year is still very likely to be a blowout year for the AR industry. The wide range of application scenarios of AR also determines the inevitability of its market growth in the future.
The current entire market is more like the "coldest moment" before the spring, long-term high input and low output, has made the forerunners such as Microsoft and Magic Leap float, meta, Apple and other giants are obscure, trying to play the last blow that determines the right to speak in the industry.
From all indications, a large number of foreign AR talents are accelerating the flow to Meta, Microsoft and Magic Leap are likely to face the dilemma of "getting up early and catching up late", once this AR manpower change is completed, individual companies will be absolutely dominant in scale and technology, and a large number of early enterprises will either become second-rate enterprises or die out, just like the stories that have happened in the smartphone market.