Zuck's 10 Year bet - MetaVisions #32

Hate or Love them, Meta’s story and vision is one for the history books. When focusing on Spatial Computing, they rebranded from Facebook to Meta, acquired Oculus, created the Reality Labs business unit and many many billions of dollars invested, Meta has led the XR market by capturing over 70% of its market share. Whilst many organisations doubled down on what’s already working, Meta took a leap of faith.

This infamous 10-year roadmap launched in 2016 by Zuck is weirdly accurate, it reflects quite well the advancements and areas of focus that we are seeing in Tech.

Of course, when Mark changed Facebook’s strategy of being a great ad and social platform company to investing in more innovative plays such as the ‘Metaverse’ it created a lot of buzz and with it came what I believe were unrealistic expectations. Sure, burping out Metaverse without giving it any ‘real’ meaning about what it is, how we are going to get there and why humans will want it, it’s not the best way to make investors feel safe. Especially if there are tens of Billions of dollars being poured into it every year. In 2021, the market made sure to make their discontentment heard.

What I believe many people missed out on, is that in Facebook’s 10 year roadmap, VR/AR was not 5 years away, it was 10 years away. Sure, it is incredibly hard to put much faith in a vision when much of it is badly pixelated virtual worlds, bulky and expensive headsets and not many value-creating use cases. Building out Zuck’s vision, was going to take time and money, lots of it. To be more specific, since the creation of the Reality Labs business unit, it has had cumulative losses of 50 Billion Dollars. The good news is that we are getting close to arriving at Mark’s original vision.

Making Mixed Reality accessible

To Meta’s credit, they have always been the most accessible player in the XR market, which is one of the reasons why they captured so much market in the B2C space, especially with gamers. The original Oculus Quest 64GB was released at $399 in 2019, at the time this was already a very well-priced headset, delivering similar performance and features compared to more expensive options.

Fast forward 5 years at this year’s Connect event, Meta announced the Meta Quest 3S with a starting price of $299, the headset has almost identical technical specs to the Quest 3 and enables a great Mixed Reality experience. Now, it is cheaper to get a great Mixed Reality headset than an Xbox or a PS5. The Meta Quest line-up was already outselling Xbox consoles, this will create an even bigger gap.

Mixed Reality experiences will not become mainstream through $3500 headsets. Sorry Apple Fanboys. Yes, the Vision Pro is great and does feel like a high-end experience, unless you have enough cash to waste away, you wouldn’t give your kid a $3.5K headset for them to be able to game with their friends (to be honest, there’s actually almost 0 games on the AVP anyways), but 300 bucks seems a lot more realistic.

A more accessible experience will not only impact the number of end-users, as more people own headsets in their homes, but we will also start to see an increased amount of investment from dev studios to create new games, apps and platforms that are best experienced in Mixed Reality. In addition to this, brands will have a new channel to do brand activations and a unique way to create differentiation.

My bet? 1 in 5 homes in NA and EMEA to have a Mixed Reality headset by 2027.

Orion - final destination

Glasses, we all wear at least a couple times a year when the sun finally decides to come out beaming or even daily if your vision is not 100%. A proven and accepted form factor.

Augmented reality, has lots of potential, based on providing digitalised information to someone in a way that it blends with its environment, using clear displays. Not to be confused with Mixed Reality, which shows your physical environment through a mix of displays, cameras and sensors. Microsoft had a go at it with the HoloLens, as well as Magic Leap and other smaller start-ups. All focused on the B2B market. Main challenges? Form Factor and Pricing.

What if you could combine glasses with Augmented Reality and a sprinkle of multimodal AI? This is what many in the industry have been excited about and believe is where the next generation of computing interfaces will happen. Of course, this is what Meta has been building towards. At this year’s Meta Connect, Zuck showed us Orion, the project that Meta has been working on since the creation of Reality Labs. Although it is not going to be launched yet, as some improvements need to happen (e.g. 1K prototype units built costing $10K per unit), it is incredibly exciting to see what the near future holds for us.

I won’t ramble about the technical marvels that have gone into Orion, you can read all about it in this Meta blog post, definitely worth the read.

Project Orion could represent somewhat of a full-circle journey for Meta. The creation of Facebook, and investments in Instagram and WhatsApp completely shifted how we connected as individuals, moving most interactions from a physical realm to a digital one. Whilst one could argue that Meta’s success in growing their platforms has created more positive or negative externalities, it has massively contributed to constructing a permanent tissue that connects both physical and digital worlds. Once we accept that this is an essential part of our society, the question becomes: how can we stay connected to the digital world without being stuck to screens? Well, it is Meta who might have created and found the answer to this.

See you soon,
Davi, MetaVisions