So Magic Leap has uncloaked. Rolling Stone has the best look at the technology so far. Those I look up to in the industry who have seen it, from friends to people like investor Benedict Evans, who works at A16, are mostly excited. Benedict has been tweeting about his excitement for some time, and repeats that here in a comparison to HoloLens.
Yes, there’s lots we don’t know. Price? Expected to be $1,000 to $2,000 (I’m hearing they are trying to get it below $1,000 to appeal to consumers, but the developer version, which is what was announced today, might be higher). Quantities? Unknown, but I love that if you fill out the form on the Magic Leap Website, you’ll notice that it asks if you are a developer, just interested, or a reporter. I suggest that they will take the developers more seriously, at least at first.
Which gets me to my analysis: will this be successful?
I’m both skeptical and optimistic.
First, my skepticism:
1. The market isn’t ready. Quick, explain to me why we need augmented reality glasses (or, let’s go with the term that Magic Leap’s founder uses, “spatial computing”). I know, but then I already have a pair of Microsoft’s HoloLens and I already have several VR headsets. The lack of real success in VR (the best headsets have sold in low millions) shows that the market doesn’t get why we need a new computing platform.
2. Industry FUD. Fear, Uncertainty, and Doubt. We use that term to explain what happens when bigger competitors announce products and get you to wait on your purchase. Microsoft already announced that its next HoloLens will come in 2019. That, alone, will get many to wait. Apple did the same, too, and has 1,200 engineers working on its Magic Leap competitor in Israel.
3. Lack of use cases. I’ve been touring the world this year talking with music industry people, with banking people, with automakers, and others. Magic Leap isn’t yet being taken seriously. Why? Because it hasn’t sold a single product yet. Will it get there? Maybe, but for now the industry is skeptical and, unless Magic Leap is paying for development, most are ignoring. Can that change? Yes, but that gets me to point four.
4. Even if it’s wildly successful it probably won’t make a real dent in marketshare in the industry. Let’s look at VR. HTC Vive is an amazing product but only sold about a million. Let’s say Magic Leap is 20x more successful. That’s 20 million headsets sold. Drop in the bucket. Apple could sell that many in its first month. Back to FUD. And chances that it’ll sell 20x more than HTC Vive? Possible, but not probable. Why? Well, there are a million early adopters who’ll buy for sure. I’ll be one. But to get to everyday people? You need brand, stores, and make a product that’s safe to buy, er, necessary to buy. We’re a long way from all that and I believe it’ll take many billions to build all that from a standing start. Even if it does exceed all expectations (many of my friends who’ve seen it believe it will) it will face huge, entrenched competitors within three years (Apple, Google, Facebook, Snap, Amazon, and a bunch of Chinese companies are all gearing up their own efforts and, most are spending billions in getting their products ready to get to market).
5. The Google Glass and Snapchat Glass effect. Both of those were market failures that didn’t exceed expectations. So now another “cool company” comes along with something you have to wear on your face. Most consumers will just say “wake me up when these things are a market necessity.” They rightfully will point back to those earlier attempts and say “I’m glad I wasn’t the first.”
6. Too much competition from other things. Let’s say you have $1,000 extra in your pocket. Congratulations, by the way. That already puts you in a pretty rare group of people. But will you put it toward these, or a new Xbox, or a new phone? I’m betting on the new phone. Why? Millions of apps. Lots of use cases. Etc. New and fantastic toys are fun to dream about, but a lot harder to actually choose to buy.
So why am I optimistic?
1. Almost everyone I’ve talked to who has seen Magic Leap, from professors to my friends who have made VR companies, say that Magic Leap pushes the technology way forward and represents a real “leap.”
2. Even if it fails in the marketplace the team has value. Luxotica, for instance, owns almost every sunglass brand (Oakley, Ray Ban, etc) and it will need its own augmented reality glasses to compete with Apple. It will have taken note that Apple, with its watch, tore a big hole in the watch industry and changed that and that’s with a product that really hasn’t gotten many people excited.
3. Those of us who have a HoloLens know that there’s real utility once some of the major problems get solved (which, for me, are weight, weight, weight. Others say viewing angle disturbs them). Magic Leap looks to have solved both, albeit you need a computing pack that you’ll wear on your waist. Either way, though, this is why I’m looking forward to getting one. I love my HoloLens, I just can’t use it very much because it hurts my nose after 45 minutes of use and the optics aren’t very sharp and the viewing angle does keep it from “immersing” you into the content.
4. There is a sizable enterprise market waiting for a great product. Why? Well, for one you get as many screens around you as you want. For two, if you are, say, an architect, you can see your designs in a whole new way than you could on a 2D screen. For three, entertainment will really take off if these sell well. Movie industry is chomping at the bit to build new kinds of movies that you are inside (I saw one at Oculus Story Studio that I wrote about last post). Car designers want these too, and so do many others who work with 3D objects, which is why Magic Leap and Autodesk are working on some projects that I bet we’ll hear more about next year.
What do you think? Are you buying one? Come over to Facebook and comment on this post on my Facebook profile.