Meta VR dreams of ‘Google Android’, opportunity opens due to Apple Vision Pro’s sluggish performance

[비즈니스포스트] There is an assessment that Meta may take a similar step to Google, which developed the smartphone operating system Android, by opening up ‘Horizon OS’, a virtual reality (VR) headset operating system (OS), to third parties.

Meta’s VR division is still making losses, but with expectations of reflected profits growing due to the sluggish performance of its rival, Apple’s Vision Pro, attention is being paid to whether it can expand its business opportunities.

According to the New York Times on the 24th (local time), Reality Labs, Meta’s VR division, recorded an operating loss of $3.85 billion (about 5.304 trillion won) in the first quarter of 2024.

However, sales increased compared to the same period a year ago. Reality Labs’ first quarter sales were calculated to be $440 million (approximately KRW 605.6 billion), a 29.8% increase from the first quarter of 2023.

As the demand forecast for Meta’s VR headset ‘Quest’ series and its competing product, Apple’s Vision Pro, has been significantly lowered, it is considered a factor in Metaverse’s sales continuing to rise.

Mingchi Kuo, a researcher at TF International Securities, said, “It is understood that Apple has lowered its Vision Pro shipment target for this year to around 400,000 to 450,000 units (half of the original estimate).”

Researcher Kuo added that Apple has entered the stage of reexamining its plans to commercialize the successor to Vision Pro.

Apple is also experiencing a talent drain. According to Bloomberg, Frank Casanova, a key executive in charge of Vision Pro marketing, left Apple in April.

Due to the uncertainty of the launch of follow-up products and the negative news of key personnel leaving, it has been reported that there is even talk of the possibility that Apple will eventually significantly change the direction of its VR business or virtually give up on entering the market.

The New York Times also evaluated that “Reality Labs’ losses were the amount used to build VR-related business models such as headsets and operating systems,” and analyzed that this quarter’s performance was a strong investment for future market leadership.

Since its establishment in 2014, Reality Labs is having difficulty recovering, with accumulated losses exceeding $45 billion (approximately 61.89 trillion won) as of the first quarter of this year.

Meta was also expected to benefit as VR and Metaverse content increased with the launch of Vision Pro, but market growth was sluggish.

However, the fact that Meta is expected to dominate the VR headset market is cited as a reason why it is difficult to give up hope.

The reason for the recent move to expand the related market by releasing Horizon OS to other companies such as Microsoft (MS) and Lenovo is analyzed in the same context.

They believe it is difficult to lead the popularization of VR headsets with their own devices alone, so they are actively trying to attract other manufacturers.

This is interpreted as the purpose of expanding the overall VR headset market through the influx of hardware companies, and at the same time, Meta will lead the platform and build a business model like Google Android in the Metaverse market.

CNBC analyzed, “Meta’s decision to open the OS is consistent with the strategic reasons why the reality division spends billions of dollars per quarter.”

Google is also one of the competitors aiming to re-enter the VR and mixed reality (MR) market by joining hands with Samsung Electronics and Qualcomm. On the other hand, Meta is showing confidence by indicating its ambition to include the Google Store in Horizon OS.

This can be interpreted as a determination not to repeat what happened in social media (SNS) sectors such as Facebook and Instagram, where they had no choice but to pay fees to Google and Apple and follow their advertising policies.

In the end, Meta seems to have planned to form a ‘Meta vs. Apple’ structure in the metaverse market and establish itself as a market leader like ‘iPhone vs. Android’.

However, this is based on the assumption that the VR and extended reality (MR) markets will become as popular as smartphones, so the outlook is still unclear. MR refers to a technology that encompasses augmented reality (AR), which adds VR to actual reality.

Attention is focused on whether the choice to open Horizon OS for VR devices to hardware companies will have the same effect as Android on smartphones.

Business Insider, an economic magazine, said, “Meta CEO Mark Zuckerberg has repeatedly expressed skepticism about Vision Pro’s chances of success,” emphasizing that Meta is clearly at odds with Apple. Reporter Lee Geun-ho