Thank you @My Weekly Stock for restacking our post.
The uncertainty surrounding mainstream adoption of the Apple Vision Pro seems to be the main concern around whether this is really the device that will set forth Apple for the next phase of its innovation.
As for whether to spend $3500 on Apple Vision Pro, I share your thoughts.
Thanks anna. Guess Im going to check them out. My old Samsung Galaxy is giving me trouble and I'm looking for something refreshing, moving beyond the iPhone-Galaxy-Pixel phone lineup.
If the fidelity and latency metrics are there in a form factor that can operate well for 8+ hours and be comfortable enough to wear for that amount of time, it has a lot of potential in manufacturing, design, construction, and so many other industrial spaces. Device performance and wear ability has always been a limiting factor for adoption beyond entertainment, which is where real innovation and productivity gains can be made to justify the cost. Otherwise, it is another expensive toy.
Excellent, piece, thank you for putting it together.
Thanks for adding your perspectives, Dean! Great points! You touched on many views that I did not add into this piece.
Everything you mentioned is quite typical of Apple, as I reflect on what you mentioned. When they create new categories of products they seem to always start with a higher-to-market form factor, latency and fidelity and let their fanbase and early adopters do the job for them and they gain market share later. The iMac, Macbook did the same.
Most recently, Apple displaced Fitbit with a high priced smartwatch. If you remember, Fitbit was into fitness trackers and the markets for smartwatches never existed. Then 4 years after Apple's smartwatch launch, it became a category leader while Fitbit had to be acquired.
That is also a bit of double edged sword. The original MS Surface was an awesome device that I absolutely loved using. Then the iPad came out and everyone forgot that the tablet had already been invented and the original was actually better in so many important ways.
The only thing iPads had on the original tablet was weight and looks, everything else kind of sucked. I am glad they are begrudgingly evolving the iPad to offer the things that truly make a tablet an awesome form factor.
Appreciate your work, the quality of content is very good.
It seems to me that Apple Vision has two psych-based problems that may come into play in the product's adoption and financial success beyond the sticker price: 1) motion sickness and 2) social separation.
The target market is constrained by the tendency to experience virtual reality sickness (VR motion sickness) that results when the user's brain receives conflicting signals about self-movement in a virtual environment. By some estimates, 40-70% of the population experiences this within 15 min. of using VR. While Apple says they are working on this and some reports suggest their headset is an improvement, VR motion sickness is only partly reliant on hardware. Certain populations are more vulnerable. Of particular concern are children and tweens whose brains and vestibular systems are still maturing.
And in direct contrast to social zeitgeist concerns about overuse of media post COVID social isolation, Apple has introduced a product that creates a barrier to connecting in person. While, according to Apple, it makes virtual experiences more compelling and appealing by making them feel more "real." This may be a plus for Zoom meetings and video games, but it flies in the face of a society already prone to filter bubbles. Even if the Apple Vision headset signals anyone around you that you're in an app and has some AR capacity that lets the user know when someone approaches, it encourages virtual connection--in fact, it's success depends on expanding the use of VR. Thus, it presents a further challenge to creating the meaningful social connection that is a primary need and essential to wellbeing. The good news is that it you can only hide out in virtual space for 2 hours--the length of a charge.
FYI review of research on VR motion sickness:
Eunhee Chang, Hyun Taek Kim & Byounghyun Yoo (2020) Virtual Reality Sickness: A Review of Causes and Measurements, International Journal of Human–Computer Interaction, 36:17, 1658-1682, DOI: 10.1080/10447318.2020.1778351
I was actually unaware of the motion sickness aspect of AR/VR devices, though it actually doesn't surprise me. I have yet to try on a pair of headsets to really know what it is like.
As for the social separation side of things, I fully agree with you. While I do think that over the course of the coming decade, some form of mixed-reality devices will replace the multiple screens across laptop and phones we use, there is a huge unknown as to the extent in which it engulfs all of our key senses to the point that it will make it more difficult for people to distinguish between their lives online and offline and communication and association amongst human beings even more challenging. I am somewhat concerned about that future, yes. For now, the application of the VR/AR headsets is purely geared towards entertainment and not mass application that iPhone had, though as the technology develops and matures, that may change quite rapidly.
Thanks for taking the time to reply! Lots of people have argued that for VR to succeed it needs to be social. Social presence can be very powerful. Feeling the presence of others in video conferencing or in avatars in gaming environments helped (and continue to help) a lot of people who feel isolated. However, human brains are "old" hardware from an evolutionary perspective and are wired to rely on physical presence to process relational clues (facial expressions, eye gaze, body movements). I'm waiting to see how VR developers meet this the human gold standard for social connection. Until that happens, mediated connection can be positive, but will always be second. If VR is primarily for entertainment, how much is a shared vs solitary experience? I can see VR bridging the gap (e.g. making me feel like I was at a NFL game when I was in my living room), but would it work to sit in a theater with friends and wear a VR headset? Part of that experience is seeing others' enjoyment. But, as so many comments here have pointed out, at $3500, most of these questions are moot for the Apple product.
Thanks again, Pamela. Sorry for the late reply. But your thoughts are always deep and pushes me to reflect on the post again with a different perspective all the time.
Back to your thoughts - funny how all these immersive experiences of promised lands and surreal connections of life-like people is limited by the length of a battery charge and possible VR Motion sickness.
I'm super intrigued how Apple could try to solve the VR motion sickness problem while also weaving the narrative of the benefits of mental health which will definitely become louder as an issue at some point along the adoption curve.
I’ve 2x (occulusi) at home. As a percentage of time used on them over a year they don’t even eke out a percentage. VR flight sims are all I use them for. My computers work all day, and most of the night, long so I could easily just plug in the units but they’re intrusive.
$3500 is a very strange price point as Quest sell at a fraction of that price and have been in the market longer. That’s where my money will go next...
As a minor point, I am disabled and housebound so would think as a customer I would use them more but, alas, they probably catch more dust than usage time...
I agree too. $3500 is strange. But what is even stranger is they gave consumers all of 2023 to mull over the price point and they're still going ahead with launching it at that price next month. It's as if they know something from somewhere and are confident this will sell.
About your headsets, though.. are these the original Occulus from the 2010's or something like Quest 1/2?
I have a Rift and a Rift S. I got the S as they were on offer and the Rift`s were over engineered. There are pro`s and cons to that...
I can only see the Apple set predominantly going to businesses, who can claim back tax and get a trade discount, as most people who have VR/AR know what they can do, and not do well, so would probably stick with the MQ3`s as the Pro`s quite type specific and, ironically, a lower spec.
Saying that, Apple has a large fan base and we all like different things. For $3500 I`d buy another laptop and the MQ3`s but that`s just me...
That`s a really good point. I`d forgotten about them. I do think it`s a fad though. A bit like 3D tv. They`re great at some things but they`re being sold to do things that already have solutions e.g. comms. Skype etc does that fine!?! Good luck to anyone hanging onto them by wearing them outdoors...
You can tag your tickers in the article. I recently learned about this and am trying to share the info.
Tagging the tickers will improve Substack’s ability to find the article for people who are searching for that ticker.
For instance: “Apple (AAPL) $AAPL needs to…”
The Substack app, last I knew, didn’t recognize these $ ticker links yet. However, they work on web and e-mail.
I’m encouraging all stock analysis authors to begin using this system more. If we use it as authors, it creates a bigger incentive for Substack to develop it. The more Substack develops their stock searching features, the better it will be for all stock analysis publications on Substack.
Thanks Michael, I do tag stock tickers, when I write about them, though the evening when I was publishing the post, the stock tagging feature was not working, but I will go back and update the post with the tickers like you said. Thanks
In my opinion for AR/VR to really hit critical mass they are going to have to get to the point that they are closer to the size of a pair of eyeglasses than an astronauts helmet.
At that point you can integrate them into day to day life, and get regular value even at a higher price tag. I bought my son a meta quest 3 for Christmas, and it’s a cool toy. I like shooting zombies superimposed over my living room, but if that’s all I can do I’m not paying $3000 for it, and I doubt most people would.
Now if this can become a substitute for a laptop, and improves the experience over what you get with a laptop you might find wider adoption even with a higher price tag, and a headset that you wouldn’t wear on a shopping trip to target.
Once they do get to the point of these resembling a pair of glasses I can think of a million applications and business ideas for them. I’m not sure if the tech can get there or not.
Loved how you framed your argument for the Vision Pro as a potential substitute for the laptop! I think Apple is using this year as a testing ground to see how their fanbase+early adopters on the user side, and develoepers build use cases for Vision Pro.
So far, Apple has implicitly stated that retail users can watch it for movies and personal TV. If you rewatch their presentation last year they illustrate many examples of how it can be used as a personal TV. They've also talked about gaming as a use case but there were no visuals around it.
Now explicitly, they may want to see if it can pick up steam amongst their creator-side and business-side user base just like the Macbooks and iMacs have a strong relevancy with those users.
I have mixed feelings about Apple. On the one hand I like their products. I bought my first iMac in late 2012 and am still happy with it. I replaced it in 2020 with a new one, and ... still happy with it. Yet, the latest price increases are hefty. Meanwhile, I'm wondering, if it's really worth it. The main reason, why I moved to Apple, was because of the performance and maintenance a Windows system required. And meanwhile, as far as I heard, this not, or less the case anymore. And since Steve Jobs died, you could see a decline in quality (especially in terms of software stability). Ok, it's still good, but it was better. I guess I will definitely look at alternatives when I buy my next machine.
The Vision Pro? I don't see a point in buying them, since the "benefits" are not worth $3,500 imho.
Looks like you are taking good care of your Macs. As for me, while I have always been a fan of their design and user experience, my Mac actually died recently after 4 years and this resonates with your thought on how the overall degree of quality has been on the decline since Steve Jobs days.
As for the $3500 price tag, if the application is limited to just gaming and entertainment, its adoption will be limited to a very specific target audience. I do think however, that the technology may slowly develop to a point where AR/VR or some form of mixed reality may replace the multiple screens we use in the form of laptops and phones, but till we see practical applications of that, I would fully agree with you on the limited benefits of Vision Pro.
Thanks for sharing your experience! The first iMacs always hold a special place in everyone's hearts.
About the metaverse, mixed reality headsets etc. do you still think these industry has room to expand? Businesses are showing increasing optimism in using products tied to this space and I'm closely watching this. Given that you wont be buying the Vision Pro for its wallet-draining price tag, would you still be looking at other mixed reality headsets?
as it evolves, so will the use-cases and potential benefits. I think it has a lot of potential, but it is yet not as "convincing" as Chat GPT was. Therefore the adaption velocity will be slow (at least for now). And no, I'm not interested in buying any in the near future :-)
Yes!!!! I miss my Nokia days!!! I was so much productive and focused during those years. I I bought my first smartphone in 2014, which is still quite a few years after the iPhone was released, so quite a late-adopter. My phone that I am using now is like 5 or 6 years old, works just fine. So, yeah, I still have the Nokia mindset.
A great read Amrita. Apple is definitely going to face competition with cheaper players emerging. The real-life applicability of VR/AR headsets are limited now. It can only be a game changer if it turns out to be an inevitable part of our lifestyle, like our smartphones.
Echoing your thoughts, I believe the mass applications of mixed-reality devices are still not known, and currently limited to entertainment.
I also think that $3500 is insane, but then again, if there is any company in the world who would pull it off, it probably would be Apple. But then again, Meta’s Quest is significantly cheaper and much better positioned for mass adoption.
Long term, I do believe that some form of mixed-reality/spatial computing (other fancy names?) will probably replace a portion of our existing screens and devices.
"Apple needs to sell its vision again." Every big tech company has to sell its vision again. Sales are down, and people are kinda getting tired of the gadgets. They can't afford to keep up and when this coupled with actual dissatisfaction with the "direction" of most companies, people withhold their spending. Tech is passe. It serves a purpose, like a toilet, but I don't structure my entire life around a toilet. People structure their entire existence around gadgets, fantasy, and online falsehoods. Apple knows this, so the "vision" will change, pro rae nata, "as needed."
Apple's play to create a new product will come at a bad time with 2024 an economically uncertain year, and at $3500, I agree that the product won't be focused on the general population. The fact that 78% of respondents stated they wouldn't be interested even if the product was on sale is a clear demonstration of this.
Do you think in this upcoming year in an uncertain economic environment, even big businesses would be seeking to purchase such devices to completely reshape their business practices, especially at $3500 a unit? If they haven't with other cheaper alternatives, what makes the Apple Vision Pro different?
Good question, Dylan. I'm going to let Amrita add her views on the macroeconomic side but I can definitely say its no secret that the outlook. for consumer spending is still feeble, despite what the top line economic growth suggests.
My strong guess is that Apple put the word out there last year that they have a $3500 device that lets you do immersive experiential things to give themselves time and observe all the reactions they get from all corners of the target market, and its not just retail consumers. Many companies are realizing this and subtly pivoting the appeal of their products for the enterprise where spending still remains strong. There is this 2022 survey by PwC, i think that talks about how spending in metaverse will be led by capital spending from the enterprise.
Also, if you haven't noticed, enterprises have upped their expenses on gadgets for their employees too. For the first time in 6-8 quarters, sales of Macbooks and laptops rose at Apple, Dell etc. Even Microsoft's Personal Computing division saw nice uptick in sales last quarter. So, Apple maybe onto something if they really are targeting businesses.
In my view, in 2024, the consumer spending will be weaker than before, which means its a very targeted audience that may actually consider buying the Apple Vision Pro at 3.5K, not good for mainstream adoption. At the same time though, as long as labor markets are strong, I would not be betting against the US consumer, as spending on items using BNPL is through the roof, so this may actually bode well for overall Vision Pro sales afterall.
I would fully agree with what Uttam said on the enterprise side of things.
All in all, there are still quite a lot of unknown unknowns as to the broader application side of this device, sure it has got some fancy name (spatial computing), but I think the technology will still take quite a few years to develop before mainstream adoption. Have you ever tried on any one of these headsets/devices? Quest?
Thanks for your response and your thoughts Amrita. My brother has one of the quests that he uses for gaming and I’ve had a try of his but no other exposure to the AR/VR headsets outside of this!
Apple in a nutshell for me. No one needs a $2000 smartphone and the marketplace will ultimately demonstrate that. Apple will eventually be prevented from selling them in China, potentially their largest markets. I don't want an overpriced computer. I can build my own to do number-crunching. data management and digital computer graphics. I can have it built sometimes for a 1/3 or less of what Apple and others could sell it to me for, because I know what I want and when to turn off the wallet in buying it. I do not want to be disconnected from the world when I am working, which is basically what VR does. I guess I am not a gamer or a millennial or GenZ'er, but I want to sever complete connection to the internet when I want it, but I want portability of the experience when I need it, and I don't want it to cost the price of a junker vehicle to have that experience. The company that can do that, particularly in the world of hyperinflation and zero budget restraint, will eventually dominate world markets. Will it be Apple, or will it be some other company? Only time will tell.
Thank you. You hit some good points in your commentary. There actually was another study, I just cant find it at the moment, I think it was by KPMG, where they found 60% of people who were excited about the prospects of the metaverse were millennials and GenZ's. So there is definitely more appeal for this technology for those generations and later.
But still, with a 3500 price tag, im not sure how many of them can afford it. And China, more and more looks like a sore spot in terms of Apple's target market. Since you mentioned you can build your own computer, I'm assuming its not MacOS🤓, do you build Windows or Linux or some other OS? I used to put together a nice Windows-CPU too with spare parts, then Apple's Macbook won me over.
And those are the leading edge generations too, so if they want that tech, then perhaps they'll pay up for it. I would contend that the world is getting so pricey that unless there is a substantial cost reduction, sales expansion might be limited, but who knows? The usefulness of PCs at 1984 prices were questioned too, but the costs fell quickly.
Mine are all Windows, as my trading platforms perform more quickly on Windows 10. I can find discounted parts of take my machine to shops locally that can replace chips or other hardware at the fraction of the cost of new equipment. I just need number crunching configurations and speedy graphics generation. After that, I am happy :)
Exactly. I think Amrita has a post on this where she talks about consumers really wanting deflation to get them fell good about spending when inflation falls back to its long term growth average. But as newer generations flow into the workforce, their willingness to pay is very different from the older generations. The question of affordability will only be raised when labor markets break. I guess until then, many folks feel its fine to spend $3.5k on the Vision Pro? (especially when there is Buy-Now-Pay-Later)
This is an excellent analysis, Amrita. I wonder, whether Vision Pro etc will be stunted by general inconvenience... in the same way that more books are probably sold today despite kindles existing. For most things, a screen and earphones are good enough right?
Very good question, Zan! I certainly am happy with my screen and my earphones (even if they're not bluetooth). But since we are talking about technology and technology was initially supposed to solve the convenience issue, Ill say this: One person's convenience, is another person's inconvenience.
Maybe Amazon doesnt sell as many kindles as the number of books in the world. But they're still around and Amazon is still a very profitable large technology company. Maybe they are selling enough Kindles to make enough profit on selling it and keep the user entwined in within their Amazon ecosystem.
At the end of the day, it all comes down to 2 things:
1) Has Apple found their target market yet?
2) Are they breaking even on the Vision Pro in terms of cost?
If they have the answer to #1, They will keep going because Apple has enough cash to buy some countries in the world. On #2 - they just need make sure they make 37% margins on selling the product. Apple makes roughly 37% margin on all hardware products sold. I hope that answers your question, Zan?
Ahhh I see - so it's somewhat a question of finding PMF, rather than ubiquity... super insightful response thank you for taking the time to clarify that!
Thank you for the read Amrita!
Apple has always managed to keep bears at bay ultimately. I’d not bet against them!
But they do need a new product. I don’t know/not sure if Vision pro will be the one.
Instead of spending $3.5k on the Vision pro, I’d rather buy the stock!
Thank you @My Weekly Stock for restacking our post.
The uncertainty surrounding mainstream adoption of the Apple Vision Pro seems to be the main concern around whether this is really the device that will set forth Apple for the next phase of its innovation.
As for whether to spend $3500 on Apple Vision Pro, I share your thoughts.
I am loving my 'all day carry' Nokia 2660. Eyeballs pop out around me when the Nokia ring goes off.
Wow! Is that the new one that their new owner HMD makes or the classic model that was released in 2007?
The new flip one in green! Sound quality 100 times better than iphone
Thanks anna. Guess Im going to check them out. My old Samsung Galaxy is giving me trouble and I'm looking for something refreshing, moving beyond the iPhone-Galaxy-Pixel phone lineup.
If the fidelity and latency metrics are there in a form factor that can operate well for 8+ hours and be comfortable enough to wear for that amount of time, it has a lot of potential in manufacturing, design, construction, and so many other industrial spaces. Device performance and wear ability has always been a limiting factor for adoption beyond entertainment, which is where real innovation and productivity gains can be made to justify the cost. Otherwise, it is another expensive toy.
Excellent, piece, thank you for putting it together.
Thank you Dean. Glad you enjoyed the post and truly appreciate your support.
Thanks for adding your perspectives, Dean! Great points! You touched on many views that I did not add into this piece.
Everything you mentioned is quite typical of Apple, as I reflect on what you mentioned. When they create new categories of products they seem to always start with a higher-to-market form factor, latency and fidelity and let their fanbase and early adopters do the job for them and they gain market share later. The iMac, Macbook did the same.
Most recently, Apple displaced Fitbit with a high priced smartwatch. If you remember, Fitbit was into fitness trackers and the markets for smartwatches never existed. Then 4 years after Apple's smartwatch launch, it became a category leader while Fitbit had to be acquired.
That is also a bit of double edged sword. The original MS Surface was an awesome device that I absolutely loved using. Then the iPad came out and everyone forgot that the tablet had already been invented and the original was actually better in so many important ways.
The only thing iPads had on the original tablet was weight and looks, everything else kind of sucked. I am glad they are begrudgingly evolving the iPad to offer the things that truly make a tablet an awesome form factor.
Appreciate your work, the quality of content is very good.
Really great read, Amrita! As for the Vision Pro, hard pass.
Thanks Mike, glad you enjoyed the post. I am on the same boat as you on the Vision Pro, though I am generally quite a late adopter.
It seems to me that Apple Vision has two psych-based problems that may come into play in the product's adoption and financial success beyond the sticker price: 1) motion sickness and 2) social separation.
The target market is constrained by the tendency to experience virtual reality sickness (VR motion sickness) that results when the user's brain receives conflicting signals about self-movement in a virtual environment. By some estimates, 40-70% of the population experiences this within 15 min. of using VR. While Apple says they are working on this and some reports suggest their headset is an improvement, VR motion sickness is only partly reliant on hardware. Certain populations are more vulnerable. Of particular concern are children and tweens whose brains and vestibular systems are still maturing.
And in direct contrast to social zeitgeist concerns about overuse of media post COVID social isolation, Apple has introduced a product that creates a barrier to connecting in person. While, according to Apple, it makes virtual experiences more compelling and appealing by making them feel more "real." This may be a plus for Zoom meetings and video games, but it flies in the face of a society already prone to filter bubbles. Even if the Apple Vision headset signals anyone around you that you're in an app and has some AR capacity that lets the user know when someone approaches, it encourages virtual connection--in fact, it's success depends on expanding the use of VR. Thus, it presents a further challenge to creating the meaningful social connection that is a primary need and essential to wellbeing. The good news is that it you can only hide out in virtual space for 2 hours--the length of a charge.
FYI review of research on VR motion sickness:
Eunhee Chang, Hyun Taek Kim & Byounghyun Yoo (2020) Virtual Reality Sickness: A Review of Causes and Measurements, International Journal of Human–Computer Interaction, 36:17, 1658-1682, DOI: 10.1080/10447318.2020.1778351
Thanks Pamela for such an insightful comment.
I was actually unaware of the motion sickness aspect of AR/VR devices, though it actually doesn't surprise me. I have yet to try on a pair of headsets to really know what it is like.
As for the social separation side of things, I fully agree with you. While I do think that over the course of the coming decade, some form of mixed-reality devices will replace the multiple screens across laptop and phones we use, there is a huge unknown as to the extent in which it engulfs all of our key senses to the point that it will make it more difficult for people to distinguish between their lives online and offline and communication and association amongst human beings even more challenging. I am somewhat concerned about that future, yes. For now, the application of the VR/AR headsets is purely geared towards entertainment and not mass application that iPhone had, though as the technology develops and matures, that may change quite rapidly.
Thanks for taking the time to reply! Lots of people have argued that for VR to succeed it needs to be social. Social presence can be very powerful. Feeling the presence of others in video conferencing or in avatars in gaming environments helped (and continue to help) a lot of people who feel isolated. However, human brains are "old" hardware from an evolutionary perspective and are wired to rely on physical presence to process relational clues (facial expressions, eye gaze, body movements). I'm waiting to see how VR developers meet this the human gold standard for social connection. Until that happens, mediated connection can be positive, but will always be second. If VR is primarily for entertainment, how much is a shared vs solitary experience? I can see VR bridging the gap (e.g. making me feel like I was at a NFL game when I was in my living room), but would it work to sit in a theater with friends and wear a VR headset? Part of that experience is seeing others' enjoyment. But, as so many comments here have pointed out, at $3500, most of these questions are moot for the Apple product.
Thanks again, Pamela. Sorry for the late reply. But your thoughts are always deep and pushes me to reflect on the post again with a different perspective all the time.
Back to your thoughts - funny how all these immersive experiences of promised lands and surreal connections of life-like people is limited by the length of a battery charge and possible VR Motion sickness.
I'm super intrigued how Apple could try to solve the VR motion sickness problem while also weaving the narrative of the benefits of mental health which will definitely become louder as an issue at some point along the adoption curve.
I’ve 2x (occulusi) at home. As a percentage of time used on them over a year they don’t even eke out a percentage. VR flight sims are all I use them for. My computers work all day, and most of the night, long so I could easily just plug in the units but they’re intrusive.
$3500 is a very strange price point as Quest sell at a fraction of that price and have been in the market longer. That’s where my money will go next...
As a minor point, I am disabled and housebound so would think as a customer I would use them more but, alas, they probably catch more dust than usage time...
I agree too. $3500 is strange. But what is even stranger is they gave consumers all of 2023 to mull over the price point and they're still going ahead with launching it at that price next month. It's as if they know something from somewhere and are confident this will sell.
About your headsets, though.. are these the original Occulus from the 2010's or something like Quest 1/2?
I have a Rift and a Rift S. I got the S as they were on offer and the Rift`s were over engineered. There are pro`s and cons to that...
I can only see the Apple set predominantly going to businesses, who can claim back tax and get a trade discount, as most people who have VR/AR know what they can do, and not do well, so would probably stick with the MQ3`s as the Pro`s quite type specific and, ironically, a lower spec.
Saying that, Apple has a large fan base and we all like different things. For $3500 I`d buy another laptop and the MQ3`s but that`s just me...
Yup. Im also of the opinion that this device will go more to creators and enterprises. And creators are a large part of Apple's fanbase.
That`s a really good point. I`d forgotten about them. I do think it`s a fad though. A bit like 3D tv. They`re great at some things but they`re being sold to do things that already have solutions e.g. comms. Skype etc does that fine!?! Good luck to anyone hanging onto them by wearing them outdoors...
You can tag your tickers in the article. I recently learned about this and am trying to share the info.
Tagging the tickers will improve Substack’s ability to find the article for people who are searching for that ticker.
For instance: “Apple (AAPL) $AAPL needs to…”
The Substack app, last I knew, didn’t recognize these $ ticker links yet. However, they work on web and e-mail.
I’m encouraging all stock analysis authors to begin using this system more. If we use it as authors, it creates a bigger incentive for Substack to develop it. The more Substack develops their stock searching features, the better it will be for all stock analysis publications on Substack.
Thanks Michael, I do tag stock tickers, when I write about them, though the evening when I was publishing the post, the stock tagging feature was not working, but I will go back and update the post with the tickers like you said. Thanks
Thanks Amrita. Trying to get the word out to several authors. Hoping we can get this to spread throughout all the stock substacks.
In my opinion for AR/VR to really hit critical mass they are going to have to get to the point that they are closer to the size of a pair of eyeglasses than an astronauts helmet.
At that point you can integrate them into day to day life, and get regular value even at a higher price tag. I bought my son a meta quest 3 for Christmas, and it’s a cool toy. I like shooting zombies superimposed over my living room, but if that’s all I can do I’m not paying $3000 for it, and I doubt most people would.
Now if this can become a substitute for a laptop, and improves the experience over what you get with a laptop you might find wider adoption even with a higher price tag, and a headset that you wouldn’t wear on a shopping trip to target.
Once they do get to the point of these resembling a pair of glasses I can think of a million applications and business ideas for them. I’m not sure if the tech can get there or not.
Loved how you framed your argument for the Vision Pro as a potential substitute for the laptop! I think Apple is using this year as a testing ground to see how their fanbase+early adopters on the user side, and develoepers build use cases for Vision Pro.
So far, Apple has implicitly stated that retail users can watch it for movies and personal TV. If you rewatch their presentation last year they illustrate many examples of how it can be used as a personal TV. They've also talked about gaming as a use case but there were no visuals around it.
Now explicitly, they may want to see if it can pick up steam amongst their creator-side and business-side user base just like the Macbooks and iMacs have a strong relevancy with those users.
I have mixed feelings about Apple. On the one hand I like their products. I bought my first iMac in late 2012 and am still happy with it. I replaced it in 2020 with a new one, and ... still happy with it. Yet, the latest price increases are hefty. Meanwhile, I'm wondering, if it's really worth it. The main reason, why I moved to Apple, was because of the performance and maintenance a Windows system required. And meanwhile, as far as I heard, this not, or less the case anymore. And since Steve Jobs died, you could see a decline in quality (especially in terms of software stability). Ok, it's still good, but it was better. I guess I will definitely look at alternatives when I buy my next machine.
The Vision Pro? I don't see a point in buying them, since the "benefits" are not worth $3,500 imho.
Looks like you are taking good care of your Macs. As for me, while I have always been a fan of their design and user experience, my Mac actually died recently after 4 years and this resonates with your thought on how the overall degree of quality has been on the decline since Steve Jobs days.
As for the $3500 price tag, if the application is limited to just gaming and entertainment, its adoption will be limited to a very specific target audience. I do think however, that the technology may slowly develop to a point where AR/VR or some form of mixed reality may replace the multiple screens we use in the form of laptops and phones, but till we see practical applications of that, I would fully agree with you on the limited benefits of Vision Pro.
Thanks for sharing your experience! The first iMacs always hold a special place in everyone's hearts.
About the metaverse, mixed reality headsets etc. do you still think these industry has room to expand? Businesses are showing increasing optimism in using products tied to this space and I'm closely watching this. Given that you wont be buying the Vision Pro for its wallet-draining price tag, would you still be looking at other mixed reality headsets?
Hi Uttam,
as it evolves, so will the use-cases and potential benefits. I think it has a lot of potential, but it is yet not as "convincing" as Chat GPT was. Therefore the adaption velocity will be slow (at least for now). And no, I'm not interested in buying any in the near future :-)
I love it and it weighs nothing and if i lose it the heck i care!
I'm pretty sure when Amrita reads this she'll be telling me "I miss my Nokia days." 🙄🙄
Yes!!!! I miss my Nokia days!!! I was so much productive and focused during those years. I I bought my first smartphone in 2014, which is still quite a few years after the iPhone was released, so quite a late-adopter. My phone that I am using now is like 5 or 6 years old, works just fine. So, yeah, I still have the Nokia mindset.
I miss my Blackberry the most :(
A great read Amrita. Apple is definitely going to face competition with cheaper players emerging. The real-life applicability of VR/AR headsets are limited now. It can only be a game changer if it turns out to be an inevitable part of our lifestyle, like our smartphones.
Great point @Sanuj Thomas.
Echoing your thoughts, I believe the mass applications of mixed-reality devices are still not known, and currently limited to entertainment.
I also think that $3500 is insane, but then again, if there is any company in the world who would pull it off, it probably would be Apple. But then again, Meta’s Quest is significantly cheaper and much better positioned for mass adoption.
Long term, I do believe that some form of mixed-reality/spatial computing (other fancy names?) will probably replace a portion of our existing screens and devices.
Lots of exciting innovation lined up in 2024.
"Apple needs to sell its vision again." Every big tech company has to sell its vision again. Sales are down, and people are kinda getting tired of the gadgets. They can't afford to keep up and when this coupled with actual dissatisfaction with the "direction" of most companies, people withhold their spending. Tech is passe. It serves a purpose, like a toilet, but I don't structure my entire life around a toilet. People structure their entire existence around gadgets, fantasy, and online falsehoods. Apple knows this, so the "vision" will change, pro rae nata, "as needed."
Great post Amrita and Uttam.
Apple's play to create a new product will come at a bad time with 2024 an economically uncertain year, and at $3500, I agree that the product won't be focused on the general population. The fact that 78% of respondents stated they wouldn't be interested even if the product was on sale is a clear demonstration of this.
Do you think in this upcoming year in an uncertain economic environment, even big businesses would be seeking to purchase such devices to completely reshape their business practices, especially at $3500 a unit? If they haven't with other cheaper alternatives, what makes the Apple Vision Pro different?
Good question, Dylan. I'm going to let Amrita add her views on the macroeconomic side but I can definitely say its no secret that the outlook. for consumer spending is still feeble, despite what the top line economic growth suggests.
My strong guess is that Apple put the word out there last year that they have a $3500 device that lets you do immersive experiential things to give themselves time and observe all the reactions they get from all corners of the target market, and its not just retail consumers. Many companies are realizing this and subtly pivoting the appeal of their products for the enterprise where spending still remains strong. There is this 2022 survey by PwC, i think that talks about how spending in metaverse will be led by capital spending from the enterprise.
Also, if you haven't noticed, enterprises have upped their expenses on gadgets for their employees too. For the first time in 6-8 quarters, sales of Macbooks and laptops rose at Apple, Dell etc. Even Microsoft's Personal Computing division saw nice uptick in sales last quarter. So, Apple maybe onto something if they really are targeting businesses.
Thank you Uttam for your in depth comment. I was unaware that PC sales for last quarter rose. Very interesting times we’re living in, that’s for sure!
Thanks Dylan, glad you enjoyed the post.
In my view, in 2024, the consumer spending will be weaker than before, which means its a very targeted audience that may actually consider buying the Apple Vision Pro at 3.5K, not good for mainstream adoption. At the same time though, as long as labor markets are strong, I would not be betting against the US consumer, as spending on items using BNPL is through the roof, so this may actually bode well for overall Vision Pro sales afterall.
I would fully agree with what Uttam said on the enterprise side of things.
All in all, there are still quite a lot of unknown unknowns as to the broader application side of this device, sure it has got some fancy name (spatial computing), but I think the technology will still take quite a few years to develop before mainstream adoption. Have you ever tried on any one of these headsets/devices? Quest?
Thanks for your response and your thoughts Amrita. My brother has one of the quests that he uses for gaming and I’ve had a try of his but no other exposure to the AR/VR headsets outside of this!
Apple in a nutshell for me. No one needs a $2000 smartphone and the marketplace will ultimately demonstrate that. Apple will eventually be prevented from selling them in China, potentially their largest markets. I don't want an overpriced computer. I can build my own to do number-crunching. data management and digital computer graphics. I can have it built sometimes for a 1/3 or less of what Apple and others could sell it to me for, because I know what I want and when to turn off the wallet in buying it. I do not want to be disconnected from the world when I am working, which is basically what VR does. I guess I am not a gamer or a millennial or GenZ'er, but I want to sever complete connection to the internet when I want it, but I want portability of the experience when I need it, and I don't want it to cost the price of a junker vehicle to have that experience. The company that can do that, particularly in the world of hyperinflation and zero budget restraint, will eventually dominate world markets. Will it be Apple, or will it be some other company? Only time will tell.
Great article.
Thank you. You hit some good points in your commentary. There actually was another study, I just cant find it at the moment, I think it was by KPMG, where they found 60% of people who were excited about the prospects of the metaverse were millennials and GenZ's. So there is definitely more appeal for this technology for those generations and later.
But still, with a 3500 price tag, im not sure how many of them can afford it. And China, more and more looks like a sore spot in terms of Apple's target market. Since you mentioned you can build your own computer, I'm assuming its not MacOS🤓, do you build Windows or Linux or some other OS? I used to put together a nice Windows-CPU too with spare parts, then Apple's Macbook won me over.
And those are the leading edge generations too, so if they want that tech, then perhaps they'll pay up for it. I would contend that the world is getting so pricey that unless there is a substantial cost reduction, sales expansion might be limited, but who knows? The usefulness of PCs at 1984 prices were questioned too, but the costs fell quickly.
Mine are all Windows, as my trading platforms perform more quickly on Windows 10. I can find discounted parts of take my machine to shops locally that can replace chips or other hardware at the fraction of the cost of new equipment. I just need number crunching configurations and speedy graphics generation. After that, I am happy :)
Exactly. I think Amrita has a post on this where she talks about consumers really wanting deflation to get them fell good about spending when inflation falls back to its long term growth average. But as newer generations flow into the workforce, their willingness to pay is very different from the older generations. The question of affordability will only be raised when labor markets break. I guess until then, many folks feel its fine to spend $3.5k on the Vision Pro? (especially when there is Buy-Now-Pay-Later)
Fantastic Read!
Thank you!!! Glad you liked it.
Thank you!
This is an excellent analysis, Amrita. I wonder, whether Vision Pro etc will be stunted by general inconvenience... in the same way that more books are probably sold today despite kindles existing. For most things, a screen and earphones are good enough right?
Very good question, Zan! I certainly am happy with my screen and my earphones (even if they're not bluetooth). But since we are talking about technology and technology was initially supposed to solve the convenience issue, Ill say this: One person's convenience, is another person's inconvenience.
Maybe Amazon doesnt sell as many kindles as the number of books in the world. But they're still around and Amazon is still a very profitable large technology company. Maybe they are selling enough Kindles to make enough profit on selling it and keep the user entwined in within their Amazon ecosystem.
At the end of the day, it all comes down to 2 things:
1) Has Apple found their target market yet?
2) Are they breaking even on the Vision Pro in terms of cost?
If they have the answer to #1, They will keep going because Apple has enough cash to buy some countries in the world. On #2 - they just need make sure they make 37% margins on selling the product. Apple makes roughly 37% margin on all hardware products sold. I hope that answers your question, Zan?
Ahhh I see - so it's somewhat a question of finding PMF, rather than ubiquity... super insightful response thank you for taking the time to clarify that!