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The Stinger Report #1246 - The Hyperscape Reality – Part 1
The September XR consumer landscape showcased a mixed outlook, with Apple notably absent of significant advancements in its Spatial Computing platform, disappointing supporters and causing a market dip post-event amid no new hardware announcements or substantial app support, signaling a slow start for their Vision Pro system. Meanwhile, Meta’s CONNECT 2025 highlighted ongoing struggles within the VR sector, including platform consolidations, layoffs, and the abandonment of promising features like ‘Augments,’ alongside a pivot toward AR glasses—particularly the AR-lite Ray-Ban displays—raising privacy concerns and dampening sales forecasts. Despite efforts to emphasize content creation tools and metaverse ambitions, Meta’s focus on transitioning from VR to AR reflects an industry grappling with delayed consumer adoption, waning enthusiasm, and investor skepticism, underscoring a challenging environment for XR market growth and the need for clearer strategic direction.
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This is the Stinger Report, issue number 1246, The Hyperscape Reality, Part 1 by Kevin Williams. The acceleration in XR investment seems to have fragmented. Where consumer VR was the main driving force of investment seven years ago, a more focused approach is prevalent. IN has been ushered an AR future with smart glasses, with VR being redefined, if not completely sidelined. We look at key developments in this move, XR consumer progress. September started with excitement about speculation regarding the XR landscape, and in particular announcements from the mega corporations investing in the remaining consumer VR and MR landscape. Apple hides the lead. First out the traps we had Apple holding the appropriately labeled Apple event, aimed at offering a chance to present new products the corporation intended to release. The slick Apple presentation reflected the realities of the current market. No real mention of last year's spatial computing platform as the corporation revealed the current line of smartphone with the iPhone 17 line. A glimmer of hope with spatial media bail to be captured on the phone, if at a limited resolution, but the hard truth was that no mention of any improved Vision Pro hardware on the horizon. Many of the loyal supporters of the tech giant had previously speculated that they would be hearing an announcement of a brand new Apple Vision Pro special computing platform. The futuristic Gogg system had only been launched in 2024, and while offering amazing technological feats, had not hit sales targets, hampered by an excessive$3,500 price tag. Apple now treating the platform as a developer system, only for early adopters, but the lack of apps and general support seemed to point a slow start to their technological revolution. While supporters claimed an Apple Vision Air was in the wings that would see major reductions in price and features to achieve popularity in sales, while the reality saw no mention of the spatial computing system at the Apple event, the corporate PR machine attempted to spin a positive narrative about the platform. Supportive media claiming the headset was being considered in enterprise applications. But this felt more like an attempt at a means to change the story regarding the actual utility of the expensive hardware, rather than a solid example. VR providers such as VRNG, INE, ERS, VARJO, HP, and others having already established enterprise credentials in automotive and aeronautics. Previously, Apple has spun the narrative that AVP was focused on productivity and would be employed in creational pursuits. Though the reality is clear, the expensive system has been used more to consume media with those owners that retained their hardware. The most loyal of the Apple Vision supporters would not be able to hide their disappointment from the lack of any substantial spatial computing news from the September event. An ocean of promises, speculation, and rumor fueled in a level of disappointment that permeated the spatial computing scene and impacted the virtual reality landscape, Apple stock seeing a major drop after the event. The markets reflecting the disappointment from what was revealed and the less than stellar response to the lackluster iPhone 17 reveal and hype over elements that failed to materialize. Apple, no matter the reaction to the initial rollout, seemed to be in the spatial computing scene for the long run. Well-placed sources had been expecting the reality of a new lighter version of the system released in 2027, called Apple Vision Air, hoping to reappear in the market following a leveling and reality check on the market interest for head-mounted technology. Some even suggesting that Apple plans to enter the smart glasses AR market with a system of their own, pivoting from their spatial computing cool de sac. Further sources stated that the situation had changed, with Apple suspending further development in their headset aspirations, pivoting fulling to launching their AR smart glasses. Meta rings the changes. The consumer VR community was looking on the MetaConnect 2025, even a few weeks after Apple, to offer some salve to the difficult conditions that the sector was experiencing. With numerous developers pulling out of the scene or closing access to their VR content on certain platforms, echoing the statement, this year determines whether this entire effort will go down as the work of visionaries or a legendary misadventure, a statement made by Meta's chief technology officer at the beginning of the year in a leaked internal message to staff. The VR community needed to see from Connect continued support from Meta after removing Beat Saber support on other platforms and the momentum abandonment of the lone echo development community, along with other repositioning moves that impacted owned studios regarding their VR endeavors. Also seen with the news that social VR platform Rec Room had laid off 10% of their workforce, only recently raising in 2021 some$145 million in funding, having been described by the media as one of the most valuable VR companies to date, now cut back to a staff of 100 and about to announce a major repositioning in the market. As is custom for Meta, they hoped to get ahead of any bad news before this year's Connect. In interviews, the Meta team admitting they had abandoned the Augments, a MR feature promised at last year's Connect, to offer games and apps that could be virtually pinned to your wall in your house through the Quest III's mixed reality technology, admitting they had dropped this highly promoted feature because of performance and trade-off issues in a vague statement, claiming this was a pretty big miss, though stated they were not completely cancelled. Yet another disappoints regarding what was hyped and promoted, against what was delivered, if anything. Several of the key announcements had been leaked before the stage event, partly due to recent departures, partly from the poor secret retention that seems to impact reality labs. One such leak was the reveal of the new game experience for Horizon World. Developed by NDreams, the new game offers a children-friendly experience in the metaverse. However, early reports mistook this for a VR experience on the much-hyped portal. Only for it to be revealed that this was a web-only non-VR experience, confirming the move by Meta for a hard smartphone pivot for content to try and retain some audience in what had hoped to have been a VR portal. Endream was still in the VR news with confirmation of an October date for their pioneering VR action adventure called Reach. Continued investment into the Horizon World platform was evident from the announcement prior to the event that fast food restaurant chain McDonald's had launched McDonald Land within the Meta virtual environment. An attempt to connect with the majority young audience that remains in the portal. A portal that has abandoned any hopes of buyer VR medium favoring smartphone app status. This came just before news broke from the Washington Post that Meta had actively avoided the subject of its involvement in children's safety on the Horizon World platform. Leaked internal documentation pointed to the burying of information and avoidance of mentioning issues internally. This follows a 2021 congressional hearing into Meta's business. The report goes on to suggest Meta management vetoed internal research about youth safety in VR. Recent layoffs from the company have seen further information being revealed, raising concerns over their metaverse strategy, users complaining that the remaining users of Horizon seem to be children corresponding with a recent change in the user age restrictions on the Meta hardware. During Metaconnect 2025, the new hardware presentation was the previously revealed Meta Ray Band display, an alternative to their AR light glasses, now going full AR with an in-lens display, offering full heads-up information into the user's vision, from image recognition to directional and surrounding information, though not as impressive as the investor bait prototype Meta Celeste, AR glasses previewed at Connect 2024, the mono display smart glasses with their neural band interface positioning at an$800 price point for an October market launch, along with an updated AR Light Oakley glasses improvement. The keynote presentation from Meta Founder and CEO illustrated that this technology may still need more development as live demos stumbled, demonstrating the AI capability and some functionality of the new Ray-Ban display platform failing to take a WhatsApp live video call on stage, extremely embarrassing. But it was only the AR smart glasses that were revealed, with only a fleeting mention of virtual reality at the beginning of the presentation. The fixation seems to be in the consumer sphere on establishing smart AR glasses into the market. Well-placed sources suggesting that chip manufacturer Quelcom, who are supply many of the processor sets for AR glasses, forecast global smart glasses shipments for 2026 in the range of between 13 or 15 million, far less than previous speculation, and so forcing the downgrading of sales forecasts. Metas claimed a threefold increase in sales of their Ray-Ban AR Lite platform. This against major drops in sales of their Quest III and III SVR hardware. AR Lite referring to displayless smart glasses, only capturing video and images and supporting AI assistant features. While the definitive AR glasses feature in-lens displays, presenting images and information into the player's vision over the see-through vision. The pivot to the AR Lite business has raised old concerns about invasion in privacy, as these camera embedded devices can collect information without those caught in its gaze permission. There was even concern that these cameras may be active even without the user's knowledge. Medica coverage reported on public pushback against unsolicited capture, which even saw Meta had revised their smart glasses' privacy policy, expanding on their AI data collection through image and voice interaction. This appeared in many media coverage reporting, even with that assurance, the changes signify an important and concerning shift. So concerning that some Meta third-party developers stated their concerns over the changes being implemented that could impact not just AR, but their VR platforms. Even the theme park industry was linked to concerns about allowing AR glass users on rides, as the possible recording of footage on the rides and the infringement of information and invasion of privacy of other guests was raised. It is expected that an official statement from the leading theme park operators on this situation will be made soon. These issues reigniting memories of 2014 when the public attacked wearers of the then new Google Glass AR system, with the term glass hole being thrown at wearers. The insidious lack of any indication that the glasses are capturing data, be it audio via the AI assistant or video concerning many social protection groups. The reality of sales expectations of AR glasses has seriously undermined the hope that AR tentative sales successes could be used to offset the disappointment in the stalled consumer VR sector. Unable to diffuse investor anger at the failure to hit any of the ambitious targets set for the VR hardware and metaverse infrastructure. All that taken into consideration, VR was given some love during the keynote presentation at Connect. Mentioned several times, mainly regarding the implementation of the new MetaHorizons Studio app, supporting their tool called Engine to drive creation and bring the Metaverse to life. Able to create virtual environments and content to drive the ecosphere, employing AI text prompting, along with the ability to use Quest VR headsets in MR mode to scan real-world environments to create photo-realistic, hyperscape, capture, then turned into VR environments, immersive homes. The hope is to create an interconnected metaverse and drive content creation and double down on establishing their horizon world, from VR to AR and eventually their social media platform. It was clear that the progression from VR to AR accessibility is now the new focus, with platforms like the new Meta Horizon TV app. The reality was that Meta was trying to square the circle regarding their original VR slash metaverse aspirations towards the reality of retention and success of their smart glasses initiative. Those attending the event who had demonstrations of the new AR Smart Glasses or listened to the conversations on stage saw reality labs being scaled back to focus on an overarching initiative. Examples of this were inviting legendary movie director John Cameron to express his aspirations for immersive 3D experienced on meta platforms, as he is about to launch the latest in the movie series Avatar Fire and Ash later this year, along with the news of other film production houses moving across to present on the meta platform. Accusations of reality labs being rudderless as they face restructuring following recent layoff aggressively denied, with an onstage message that visionaries are five years ahead of the technology. This clearly a veiled attempt to defuse accusations regarding their business roadmap. The missteps of previous metaverse aspirations, VR hyperbole, and retention numbers turned into jokes. To diffuse the investor concern of the continued losses of$4.2 billion each year. While raw meat was being thrown to the investors of a new AR perspective, what was happening in the rest of the VR landscape?
