Bloomberg published another update on Apple’s headset plans last week, and headlines across the web are shouting Apple is building a VR headset! Bloomberg’s reporting on Apple is historically accurate and the information in the article is broadly in line with previous reports, so I find it credible. But I’m not sure people are drawing the right conclusions.

The upshot of the new and/or reconfirmed information in their report is as follows:

  • Apple’s first headset release will be “far more expensive” than current rivals like Oculus Quest
  • Very low initial sales estimates – one per Apple store per day, or about 200,000 units
  • N301 “passthru” unit still targeted for 2022 release; N421 “see-through” unit is “several years away”
  • The headset is “designed to work as a standalone device” rather than connect to a “hub in the user’s home”

I have no sources of my own at Apple, so I can’t speak to the accuracy of Bloomberg’s reporting. I do have over 5 years of experience developing VR/AR products though, and I see this new information in a somewhat different light than many analysts, including Bloomberg’s own. I thought I’d share my own thoughts.

N301 isn’t a VR headset; it’s the first convergence headset

Bloomberg’s reporting, along with many other analysts’ followups, describe the N301 device as a “VR headset.” I think this is a mischaracterization of what Apple is really building. My take is unchanged from my year-old article on Apple’s AR/VR plans; Apple’s goal all along has been to build “convergence” headsets — that is, headsets that can provide both VR and AR experiences.

The N301 headset implements a form of AR known as “pass-through” — it’s a fully enclosed design that uses cameras on the front of the headset to feed the display a sort of “closed-circuit” real-time feed of the outside world. The N421 unit, on the other hand, is a “see-through” headset — with transparent optics that overlay synthetic content on the light coming from the world. (Check out my prior article for more detail on this.) All available evidence suggests that both headsets are designed to enable both VR and AR experiences. This “convergence” of VR and AR capabilities is the natural culmination of these related technologies, and not incidentally has long been the stated goal of Facebook’s development program. But nobody’s really nailed it yet, because it’s hard. The “see-through” approach is so hard that some analysts doubt that it’s even possible to do well. The “pass-through” approach is much easier.

Pass-through bypasses the major challenges of see-through devices: field-of-view and occlusion. A wide field-of-view allows for AR content to be always present in the user’s view, not just when they turn their head to look directly at it. Proper occlusion enables AR content to seem real instead of spectral, blocking things behind it in the real world and even casting shadows. Many experts would agree that a truly successful AR implementation requires both a wide FoV and occlusion. Pass-through is the only way to deliver such an experience with current tech.

A lot of people seem to think that the form factor of the N301 headset means it’s a VR headset. Sure, I expect it will do VR every bit as well as Facebook’s next-gen Quest 3. But it will be more than that. When it ships it will also be the best AR headset on the market.

Where does the processing go?

There’s another part of Bloomberg’s new reporting that raises questions for me – the insistence that the N301 will be a standalone device. Here’s the actual quote:

Apple originally planned to include less powerful processors and offload much of the work to a hub in a user’s home that would wirelessly beam content to the headset. But that idea was squashed by Jony Ive, Apple’s design chief at the time, Bloomberg News reported last year. The headset is designed to work as a standalone device, meaning it can operate on a battery rather than be plugged into a wall or a Mac. That’s similar to Facebook’s latest VR product, while Sony’s requires a PlayStation gaming console. 

I wonder whether this is entirely accurate.

One of Apple’s biggest advantages over its AR/VR competitors at Facebook is the iPhone and iOS. Facebook’s standalone Oculus devices are built atop Google’s Android system, a fateful choice that leaves Facebook with a dangerous strategic dependence at the OS level. iOS (or rather, its rOS variant) gives Apple control of the entire stack. And this gives Apple a unique strategic advantage: they can ship an *integrated* system in which the headset offloads processing to a user’s iPhone.

This is potentially a huge advantage. As Bloomberg points out, immersive experiences demand a lot of processing power. This requires batteries, and generates a lot of heat — and you don’t want heavy hot things attached to your head. Also, that much processing power is expensive! A headset’s MSRP can be a lot lower if you can count on your customers already having the main processor in their pocket. But a successful implementation requires tight integration between headset and phone, something only Apple is positioned to do.

A number of headset manufacturers (notably nReal) have tried tethering AR glasses to Android devices using USB-C, but this is a half-solution at best. Compatibility in the Android ecosystem will always be iffy, and cables hanging from your head just plain suck. I can’t imagine Apple would ship something that connected to a phone with a cable — it’s just not elegant enough.

Apple has another option though. Recent iPhones have implemented the new UWB (ultra wideband) communications technology. This enables very short-range, very high-bandwidth communication between devices. And today it’s used for … well, pretty much nothing. The fifteen people who bought a HomePod can apparently stream music from their phone using UWB — hardly a problem that needed solving. So what did Apple build and deploy a whole new wireless nearfield communication system for?

I think Bloomberg is technically correct in saying that the Apple headsets “can operate on a battery rather than be plugged into a wall or a Mac.” But I believe Apple’s headsets will use UWB to offload processing to the iPhone. I have absolutely no information to back up this belief. I just can’t imagine why they wouldn’t exploit the strategic advantage of the incredibly powerful processors in their customers’ pockets. And I also don’t know why they’d go through all the effort to build UWB into their new phones if they didn’t have a big plan for it.

I, for one, welcome our new Apple overlords

The beautiful, lightweight, see-through AR eyeglasses of science fiction may indeed still be “years away.” The technical problems to solve are enormous and probably require exotic technologies that are still in their infancy. But I think people are badly underestimating the potential effectiveness of the approach Apple is taking with N301 — a convergence headset with really great pass-through AR. Certainly for the enterprise applications we support with Avatour, such a device would be a game-changer. And it will no doubt serve to dramatically advance the pace of adoption of immersive technology.

I’m really excited to see what they ship.