Apple building a VR headset is good news for Facebook, Qualcomm

on May 3, 2018
Reading Time: 4 minutes

Though there have been rumblings of its existence for years, a more substantial report on Apple’s development of a virtual reality product was released last week. The story indicates that Apple is targeting a 2020 release for headset and that it will use in-house developed chip, screen, and wireless technologies. True or not, the anticipation of the Cupertino-giants’ entry into the VR market will spark development acceleration by competitors and drive interest from consumers into the current state of technology.

With an expected 22 million VR headsets to sell in 2018, and that increasing to 120 million units by 2022 according to CCS Insight, there is a $10B market up for grabs.

Despite some of the language in the CNet story, what Apple is aiming to do isn’t a revolutionary step ahead of the current offerings and roadmaps that exist from other VR technology providers. Apple has a reputation, however, for waiting for the “right time” to introduce new product lines and will likely put its specific touch of refinement and focus on a segment that is viewed as moving in too many directions.

The source for this Apple information, which appears to be strong, believes that Apple is building a wireless configuration for a combined VR/AR headset. Virtual reality and augmented reality are related, but differ in that AR overlays information on the real world while VR completely blocks out your surroundings.

Unlike currently shipping detached VR headsets like the Oculus Go, Apple appears to be utilizing an external box that will provide the majority of the computation necessary. In theory, this allows the company to provide better visuals, longer battery life, and lower costs than if it had decided to go with a fully integrated solution.

Apple will have hurdles to cross. Wireless data transfer from an external unit to the headset isn’t as easy as it sounds, as the amount of bandwidth and low latency required puts specific restraints on the technology it can use. Taking advantage of 60GHz WiGig or millimeter-wave frequencies (the same used for some versions of 5G cellular) means that objects like glass and even the human body can impact performance dramatically. Hiccups in the data stream from the external box to the VR headset will result in nausea and general discomfort.

The Oculus Go from Facebook

One drawback to using an external box for processing is that it limits the portability of the device. The new Oculus Go can travel with the consumer from work, to home, to the plane. A wirelessly “tethered” system is definitely an upgrade over the wired systems that exist on PCs today, but aren’t changing the usage model. Apple could decide to go both ways – allowing the headset itself to be used for lower computational tasks like video playback and basic games, but require the external box for more intense applications and productivity.

Leaked specs from the CNet story included the use of 8K displays for EACH EYE of the headset. This would be a tough undertaking for a few reasons. First, 8K is incredibly nascent, only showing up at CES this year as a technology demo. In 2020, these panels will still be prohibitively expensive. There are hints that Apple will be building its own displays in the near future, and this could be the first target rather than the next generation of iPhone.

I would expect the VR/AR product to use Apple in-house developed silicon. The company has clearly shown that it prefers to develop towards and prioritize specific architectural directions that it has on its roadmap. Knowing that Apple also plans to replace Intel processors in its notebooks in the same time frame, there will be overlap in the chips being used. The source story believe that Apple is waiting for 5nm process technology for this jump, which is at least two process generations ahead. Getting to mass production for chips of that size by 2020 is another hurdle.

Of course, Apple is definitely not the first player in the field. Other major players have been working and developing virtual reality hardware, algorithms, and software systems, creating the capability for software to evolve. Despite the attention that Apple is getting (and will get as more rumors persist), there is a lot of gain for the first adopters.

Oculus and HTC brought the first mainstream VR headsets to the world but they required powerful PCs and were hardwired to the system. Snap-in designs like the Samsung GearVR and Google Daydream allow users to double-up the use of a smartphone with head-mounted units. Though the headset itself is reasonably priced, the phones that can provide the power for them are often $600 of higher, and limit the battery life and capabilities.

Qualcomm started developing chips and reference designs for standalone VR headsets back in 2016, and they utilize a lot of the same technology found in modern, flagship smartphones. Just this week, Oculus, now owned by Facebook, launched the Oculus Go, the first mainstream, high quality sub-$200 device for VR that does not require a PC. Early reviews have been very positive, and having used one myself for a few days, I support the idea that this is the way VR should be utilized going forward.

The current players in the VR market will see an uplift of interest thanks to the strong rumor of Apple getting into the fold within two years. To some degree, it validates the VR/AR markets. Even though there is a sizeable audience for virtual reality products today, its growth has been much slower than expected. Solid information that Apple will be entering the field will force these companies to increase investment, hoping to solidify a leadership position before Apple gets involved. It will also drive consumers to take notice of VR and AR, moving a sub-set of the audience to buy-in early once interest is peaked.