Apple Vision Pro: Can it create a new category for the tech giant?

Analysts say it will likely remain a vanity tech, though there is a view that AR, VR will become pervasive interfaces

Every time Apple has come up with a new product, it has been received with scepticism – not for its technological prowess, but for its price. It’s no different with the Vision Pro.

Priced at around Rs 2.8 lakh, or $3,499, many are wondering whether the Vision Pro will end up as just another vanity buy or will it manage to achieve what some other products have for Apple: Create a new category.

In India, the augmented reality (AR) and virtual reality (VR) headset market is still niche. According to Faisal Kawoosa, chief analyst, Techarc, the AR/VR headset market is focused towards the gaming sector, that too high-end gaming, and some of it is directed for industrial use.

Kawoosa doesn’t think the Apple Vision Pro will work on the market in India. “Honestly, after Vision Pro’s pricing, I feel the market will go down further. If Apple has a price point of Rs 2.9 lakh (approx.), then other players, especially in the android space, too will launch their products at a higher price,” he says. “Though those will be cheaper than Apple’s, they will be at a higher end. Then AR/VR will not be employed for social use like education, healthcare etc.”

According to Statista, India’s AR/VR market stands at around $624.3 million and is expected to have a compound annual growth rate (CAGR 2023-27) of 14.63 per cent.

While India’s market is still nascent, globally, this segment has seen a fall in shipments.

Global shipments of AR and VR headsets slowed significantly in the first quarter of 2023 (1Q23) as macroeconomic conditions worsened and the market cooled down compared to the pandemic-driven highs of last year. According to the International Data Corporation’s (IDC’s) Worldwide Quarterly Augmented and Virtual Reality Headset Tracker, the overall AR/VR headset market declined 54.4 per cent year-on-year in 1Q23, with VR headsets representing 96.2 per cent of the headsets shipped.

This market’s dominant player is Meta, with its AR/VR headset brand, Quest. According to IDC’s Q1 2023 report, Meta’s share of the market was 47.8 per cent. Meta’s upcoming Quest 3 is expected to cost $500.  

Some analysts believe that despite Vision Pro’s price point, there will be a market for it. “The comparison is not the same. Apple is a high-end consumer electronics brand. Meta is aiming for the broader market,” says Tuong H Nguyen, director analyst, Gartner.

Nguyen believes that games make for most of AR/VR’s current content and usage. However, the interest, maturity and growth in the next 3-5 years will be for enterprise-use cases (such as frontline work in asset-intensive industries). 

“I encourage everyone to think of AR and VR as interfaces for digital. As an interface, it will become increasingly pervasive,” he says. “While it won’t be the only way people interact with digital, it will be one of the ways. An analogy is tablets. The tablet did not replace PCs and smartphones, but it occupies a place within the usage spectrum. AR and VR will evolve in a similar fashion.”

In India, though, analysts aren’t as excited about the Vision Pro. Many say the big players have made no attempt to create a market in India. For instance, Meta’s Quest is not sold directly in India. The gadgets that are available are China-made and are for gaming purposes.

Kawoosa has a point when he asks whether AR/VR will bring incremental value addition? “Are there great use cases or applications being developed around it? The answer is, no,” he says. “In India, looking at the way 5G is unfolding, there is no monetisation. One needs to think twice about whether this is a disruptive technology. It looks more of a vanity tech.”