Wesley Hilliard
A new report says Apple will rely upon Chinese company Luxshare, not its usual Taiwanese suppliers Foxconn or Pegatron, to develop its first mixed reality headset.
Apple generally relies upon its longtime Taiwanese supply chain to develop and release first-generation products. However, if a new report is to be believed, Apple will use a Chinese supplier instead.
According to the report from Nikkei Asia, Luxshare is taking over the development team in Shanghai that was previously owned by Pegatron. This information was shared by five anonymous sources familiar with the matter.
The report refers to Apple's new products as augmented reality headsets, not mixed reality. However, it seems they are referring to the headset expected to be announced at WWDC, not a device like Apple Glass.
Pegatron had been working with Apple, the report states, but it has been on and off for four years. The company became skeptical about Apple's headset plans and exited the project to focus on other applications, according to a supply chain executive.
The shift to Luxshare isn't a complete surprise, as the company already helps build iPhones, Apple Watch, and AirPods.
Four people familiar with Apple's plans also shared that Foxconn would be developing the cheaper second-generation headset in parallel. The supplier will focus on automating mass production and improving production rates to help lower costs.
The report continues to explain the cost of parts being ordered by Apple, with displays running $150 for each eye, versus the $60 cost for each iPhone display. This is, in part, why the headset is estimated to cost between $3,000 and $5,000 — an estimate shared before.
"Apple's first generation of AR devices will be extremely expensive, and really only can attract those passionate tech geeks or premium customers," an executive with knowledge of the development told Nikkei Asia. "But Apple hopes to push the price down in the second generation of devices, which is in parallel development, to a more affordable price, like a high-end Mac computer, and hopes to attract a bigger user base."
Apple is expected to reveal the mixed reality headset during WWDC in June. The first generation is expected to be expensive and focused on developer use.
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8 Comments
Adjusted for inflation, the price range is ballpark similar to (maybe a little cheaper, actually) the cost of the least expensive Macs available in the early 90s.
In 1990, Apple sold about 1.3 million Macs (https://arstechnica.com/features/2005/12/total-share/7/).
At that time, Mac sales were almost entirely in the US alone (population at the time, 250 million).
Today the addressable market is much larger, BUT the Mac in 1990 was a known quantity with a well-understood value proposition, while this will be a new product that is unlikely to be viewed as a necessary purchase by the vast majority of people.
So.... I wonder if Apple might reasonably expect to sell about a million of these things in the first year, if that price range is accurate....
All I can say is “Good Luck”. This looks to me like a product in search of a market. Much like Zuck’s metaverse.
or sell even less out of the gate.
I suspect it will follow a course like the Apple Watch. First it will be disparaged by the tech media and PC crowd, then Apple will flail a bit trying to define its core use, then it will take over.
I still think spectator sports will be the thing that causes it to take off (and bolster Apple’s media efforts) as well as the usual suspects (a portable high end display for devs, gaming, porn, training, industrial use).
Will see. Interesting times.
No chance developing……… but making it based on a fully made Apple Prototype maybe.
Big difference between “develop” and “assemble.”
and if so, I won’t be buying. It’s bad enough that Apple has given so much to the Chinese government.