Transformation Group


The TG Blog

Will 100 Million Mixed Reality Headsets Ship by 2021?


We are not bean counters by nature. Robert Scoble and I tend to form our opinions by anecdotal research: We talk to a lot of people who know about Mixed Reality technologies: VR, AR, AI, sensors, data and the IOT. We look at what we see under development in technology and changing cultures and we make our speculations about the near-term future and how it will impact business and life.

A few weeks back, IDC a venerable and respected market researcher projected that 100 million AR and VR devices will ship by 2021. Immediately, others started explaining why this number was overly optimistic, basing that perspective on historic trends of new technologies that have no history.  The number felt conservative t me. I recollected when Forrester, another established MR firm had been accused of Hyperbolization when it forecast 100 million people would connect to the Worldwide Web by the year 2000. The calculation, the highest estimate by any research firm turned out to be low by about 200 percent.

We made no comment, but started thinking about what we see and talking to who we know and can now conclude that the IDC projection is probably too low. I turned to Mike Boland, our friend and Transformation Group partner, who recently left position as chief analyst at  ‎BIA/Kelsey, to start ARtillry, the first market research firm for just VR and AR. The new firm recently finished a new report covering just VR devices, where the firm counted 16.9 million units shipped so far. This is a significant head start, but the ARtillry report included 10 million Google Cardboard devices, an ultra low-end device that perhaps proves no more about adoption than does free samples of foods in a Costco. Superdata, a market research firm estimates that 6.3 million headsets from more serious makers have shipped, an estimate in synch with the ARtillry data.

ARtillry's report did not cover AR, which today is far smaller in consumer markets than VR, but we think this will change. There really aren't any Mixed Reality glasses for end users at all as we write today. Mixed Reality, as we described it in our book, is the next generation of device, where AR and VR are tightly integrated in one device, one that will weigh no more than ordinary eyeglasses and look just as fashionable, while containing technology that goes far beyond what most people can experience today.

Evidence is very high that AR for consumers is about to explode and much of it will fit our definition for Mixed Reality. Last week, Facebook's Mark Zuckerberg essentially repositioned his company as a social AR platform and the concept has received bravos just about everywhere. In June, Apple  will announce its new iPhone, which Scoble predicted will include an AR phone in October--a forecast now confirmed by several other credible parties. While the new devices may not ship until next year, we predict on its first weekend of availability, the AR iPhone will ship more than all the AR and VR units shipped so far.

And when we look at other hardware companies it is becoming apparent that everyone is getting into the act--as are the semiconductor companies such as Intel who have so far been left behind start to scramble to get into the Mixed Reality act. Tim Bajarin, president of Creative Strategies a semiconductor research and consulting firm, told me last week that all his semiconductor clients are researching and accelerating partnerships in the Mixed Reality  technologies.

So is every end-user focused digital hardware company so far as I can see,

Ross McDougall, a developer in the Lenovo Insider Group tweeted this morning that the Chinese digital hardware company will introduce a headset this August for $399. It will have six degrees of freedom, meaning you can see up, down and to all sides.  The device will have 1440 x 1440 resolution,  a wider field of view than today's Hololens and it will weigh about 13 ounces, three times what my eyeglasses weigh, but lighter than any of today's popular headsets.

Lenovo clearly plans to be a global  player in immersive technology devices. I attended last year's Lenovo Developer Conference in San Francisco where the CEO declared the company "was no longer just a PC company." At that time it announced the Phab 2 phone which is the first phone to use the impressive Tango AR technology developed by Google. Since then, it invested in a $50 million Series B venture round forMeta, the Silicon Valley-based AR headset makers who have introduced an impressive--but still tethered--headset.  Meta today focuses on enterprise partners but I would not be surprised if they were the technology behind the new new Lenovo headsets, which are priced low enough for consumer markets and lightweight enough to be worn comfortable for hours instead of minutes.

Acer is coming out with high resolution headsets for consumers this summer or fall at a $299 retail price. Like the Lenovo device it offers sort of a VR+ experience. While it offers some MR features, users cannot see the real world, a fundamental feature in MR. 

Years ago, I owned a Silicon Valley PR firm. It was the first agency that declared itself exclusively for Internet startups. The announced brought guffaws from sme competing agencies. The CEO would ask me if I would get paid in freeware. When I told him that I was playing for stock in several cases, he laughed even harder--but not for very long. I saw then the type of opportunity that Robert and I see now.

This is why we have started Transformation Group at this early date. We see an opportunity to help big brands become early movers in the next digital transformation. W also see the opportunity to use our many decades of experience with startups, to help the best and brightest of them to get well-position on this new and dynamic Mixed Reality playing field.

Will 100 million Mixed Reality headsets ship by 2021? We think so. We think it so deeply that we are betting our careers on  it.


Shel Israel1 Comment