Microsoft to Supply US Army More AR Combat Headsets Following Positive Field Test

Microsoft’s HoloLens-based headset built on contract for the US Army has passed an important round of field testing by soldiers. The company is now set to fulfill a larger order to be used in more rigorous testing slated to take place in 2025.

Awarded in 2019, Microsoft’s $22 billion defense contract is aiming to supply the US Army with a tactical AR headset for soldiers based on HoloLens 2 technology, or what’s called an Integrated Visual Augmentation System (IVAS),

According to Bloomberg, 20 prototype versions of the newer 1.2 IVAS headsets were field tested by two squads of solders in late August specifically to check for improvements in reliability, low-light performance and ergonomics. It was reported in early 2022 that Microsoft was bracing for negative field testing, citing concerns with low-light performance and nausea.

Taking place at Fort Drum, New York, those tests “demonstrated improvements in reliability, low light sensor performance, and form factor,” a US Army spokesperson told Bloomberg, saying further that “soldier feedback was positive.”

The Army awarded Microsoft another contract on September 5th for the 1.2 IVAS to see if the company could scale production. Its $22 billion contract indicates an upper target, and not the full amount granted to Microsoft at present.

XR Industry Giants Team up to Save Key Developer Tool

Microsoft, Qualcomm and Magic Leap announced a partnership to “guide the evolution” of the Mixed Reality Toolkit (MRTK), a cross-platform AR/VR development framework which has now gone open-source.

MRTK was a Microsoft-driven project that provided a set of components and features used to accelerate cross-platform XR app development in the Unity game engine. The developing team behind MRTK was unfortunately disbanded, as Microsoft cut both MRTK and the AltspaceVR teams earlier this year in a wide-reaching round of layoffs.

Still, as an open-source project now, Microsoft is joining XR industry cohorts Qualcomm and Magic Leap to form their own independent organization within GitHub that aspires to transform the software into a “true multi-platform toolkit that enables greater third-party collaboration.”

“With Magic Leap joining Microsoft as equal stakeholders on the MRTK steering committee, we hope to enrich the current ecosystem and help our developer community create richer, more immersive experiences that span platforms,” Magic Leap says in a blogpost. “Additionally, our support for MRTK3 will allow for simple porting of MRTK3 apps from other OpenXR devices to our platform.”

MRTK3 already supports a wide range of platforms, either full or experimentally, including OpenXR devices like Microsoft HoloLens 2, Meta Quest, Windows Mixed Reality, SteamVR, Oculus Rift (on OpenXR), Lenovo ThinkReality A3, as well as Windows Traditional desktop. The committee says more devices are “coming soon,” one of which will likely be the Magic Leap 2 AR headset.

Meanwhile, Microsoft announced MRTK3 is on track to reach general availability to developers on the second week of September 2023. To learn more, check out Microsoft’s MRTK3 hub, which includes support info, tutorials, and more.

Microsoft Releases Initial Azure Cloud Rendering Support for Quest 2 & Quest Pro

Microsoft announced it’s released a public preview of Azure Remote Rendering support for Meta Quest 2 and Quest Pro, something that promises to allow devs to render complex 3D content in the cloud and stream it to those VR headsets in real-time.

Azure Remote Rendering, which already supports desktop and the company’s AR headset HoloLens 2, notably uses a hybrid rendering approach to combine remotely rendered content with locally rendered content.

Now supporting Quest 2 and Quest Pro, developers are able to integrate Microsoft’s Azure cloud rendering capabilities to do things like view large and complex models on Quest.

Microsoft says in a developer blog post that one such developer Fracture Reality has already integrated Azure Remote Rendering into its JoinXR platform, enhancing its CAD review and workflows for engineering clients.

Image courtesy Microsoft, Fracture Reality

The JoinXR model above was said to take 3.5 minutes to upload and contains 12.6 million polygons and 8K images.

While streaming XR content from the cloud isn’t a new phenomenon—Nvidia initially released its own CloudXR integration for AWS, Microsoft Azure, and Google Cloud in 2021—Microsoft offering direct integration is a hopeful sign that the company hasn’t given up on VR, and is actively looking to bring enterprise deeper into the fold.

If you’re looking to integrate Azure’s cloud rendering tech into your project, check out Microsoft’s step-by-step guide here.

Microsoft’s Lack of XR Strategy Could Lead to Another Zune Moment

At least from the outside, it appears Microsoft isn’t actively competing for a seat at the XR table, which is fairly odd coming from a company that pioneered enterprise AR while simultaneously wrangling some of its top OEM partners to make a fleet of PC VR headsets for consumers in 2017. Microsoft gained a great early start, but now the Redmond-based tech giant is positioned to play catchup, which historically hasn’t worked out that well. Could we be in for another ‘Zune moment’? If Microsoft goes in half-cocked, maybe.

Microsoft released the first-gen Zune in 2006, an MP3 player that looked to compete with Apple’s largely dominant line of iPods. By “largely dominant,” I mean Apple not only had majority market share of the product category, making it synonymous with portable music at the time, but had already produced numerous generations of iPod Classic, iPod Mini, iPod Nano and iPod Shuffle. Apple wasn’t the first to make a portable MP3 player, although it was the first to make one everyone wanted.

Now, I can hear the Zune defenders in my head, and I sympathize. Zune wasn’t terrible, and it came at a time when full-color screens in MP3 players were just becoming a thing. It had a compelling reason to exist, which is why Microsoft directly competed against iPod Touch over the course of three device generations before eventually giving up the goat in 2011 and discontinuing the third-gen Zune. Many chalk it up to poor marketing, lack of brand cache, and not enough music to choose from. Zooming out, Zune’s ultimate defeat belies a larger pattern of behavior.

Image courtesy Digital Trends

Zune didn’t generate the sort of loyal customer base that Apple had in spades because entering rapidly evolving product categories isn’t easy. By the time platforms solidify, companies that come too late are usually tasked with flipping what’s left of undecided users or attracting users away from other ecosystems with unique selling points. Even with viable hardware on your side, it’s not an easy thing to do.

To put it into perspective, Zune entered the market one year before Apple announced the first iPhone. From that moment Microsoft was forced to play catchup not only with its MP3 players, but with its widely maligned Windows Phones which came afterwards, of which there are famously few defenders. Needless to say, Apple’s iPhone is still kicking, and that iPod/iPhone success story is why Apple is largest company in the world.

Breaking the Zune Curse?

Don’t get me wrong, Microsoft has success stories. Windows is still the world’s largest PC operating system. Azure Cloud Platform competes alongside AWS and Google Cloud. There’s a reason why we call digital slideshows a PowerPoint no matter which program you use to make them, and that’s thanks to Microsoft’s ongoing dominance in the general computing space. When Microsoft gets in early and sticks it out, you don’t generally get a Zune.

To its credit, the company had the foresight to release HoloLens in 2016, a full two years before unicorn startup Magic Leap could get its first standalone AR headset out the door. Three years later it released HoloLens 2, which directly competes today against Magic Leap Two. When HoloLens 3 will arrive, or whether it’s even in the works, still isn’t clear. We’re hoping they stick it out and it doesn’t turn into a ‘Zune moment’ down the line.

The first wave of WMR headsets launched in 2017 | Image courtesy Microsoft

In 2017, Microsoft also managed to assemble a host of major OEMs to create what would be the first Windows VR headsets, which included PC VR headsets from Dell, Lenovo, Acer, HP, Samsung, and Asus. It was a good opening gambit to break up the Oculus/HTC Vive PC VR binary that had developed a year prior, although those Windows VR headsets weren’t just new hardware destined to hook into Steam content. Microsoft made its own Windows Mixed Reality Store which ultimately failed to compete with Steam for developers, which was kind of like a Zune owner somehow getting all their music from iTunes and not Zune Marketplace.

And we’re still early, although that may not be the case for long. Compared to smartphones today, the current XR landscape is toddling out of its infancy. You’d be surprised how much competition there is already, not only across multiple hardware platforms, but entire content ecosystems—something you can’t just grow over night. Currently major contenders are Meta, Sony, HTC, Valve, Pico, Pimax, and Apple starting next year. The future leaders are shaping up to be Sony, Meta and Apple, the last two moving into mixed reality (Meta Quest Pro, Meta Quest 3, Apple Vision Pro) which feature VR displays and color passthrough cameras for AR tasks, while Sony is already in their second-gen PlayStation VR. Things are changing, and Apple jumping into XR could see a host of other companies deciding they want a piece of the pie fairly soon.

Whatever the time frame, eventually the amount of money Microsoft leaves on the table is going to pile up until it can’t be ignored. That’s essentially the strategy the company has decided to take with Xbox at least, with Xbox Game Studio head Matt Booty saying in a recent Hollywood Reporter interview that VR just isn’t big enough yet.

“We have 10 games that have achieved over 10 million players life-to-date, which is a pretty big accomplishment, but that’s the kind of scale that we need to see success for the game and it’s just, it’s not quite there yet with AR, VR,” Booty told the Hollywood Reporter.

So, while we’re no closer to knowing when Microsoft will decide it’s the right time to enter into VR (or MR for that matter), the company is well equipped and funded to break the Zune curse. Whenever Microsoft chooses to compete in consumer XR, any potential failure can’t be blamed on the lack of resources. The company now boasts a vast collection of game studios it can weaponize, which includes the entire Zenimax family of studios, including Bethesda, Arkane Studios, id Software, MachineGames, Tango Gameworks, and ZeniMax Online Studios. Provided the contentious Activision Blizzard acquisition goes through, Microsoft will also own World of Warcraft, Call of Duty, and Diablo franchises. That untapped library of IP and developer talents could make whatever Microsoft decides to bring to the XR table a serious contender.

Just the same, if the megalithic Microsoft can’t overcome what must be a massive internal friction to put out something focused, timely and well-supported, whatever it makes might as well be Zune.

Hands-on: Magic Leap 2 Shows Clear Improvements, But HoloLens 2 Retains Some Advantages

Magic Leap 2 isn’t available just yet, but when it hits the market later this year it will be directly competing with Microsoft’s HoloLens 2. Though Magic Leap 2 beats out its rival in several meaningful places, its underlying design still leaves HoloLens 2 with some advantages.

Magic Leap as a company has had a wild ride since its founding way back in 2010, with billions of dollars raised, an ambitious initial product that fell short of the hype, and a near-death and rebirth with a new CEO.

The company’s latest product, Magic Leap 2, in many ways reflects the ‘new’ Magic Leap. It’s positioned clearly as an enterprise product, aims to support more open development, and it isn’t trying to hype itself as a revolution. Hell—Magic Leap is even (sensibly) calling it an “AR headset” this time around instead of trying to invent its own vocabulary for the sake of differentiation.

After trying the headset at AWE 2022 last week, I got the sense that, like the company itself, Magic Leap 2 feels like a more mature version of what came before—and it’s not just the sleeker look.

Magic Leap 2 Hands-on

Photo by Road to VR

The most immediately obvious improvement to Magic Leap 2 is in the field-of-view, which is increased from 50° to 70° diagonally. At 70°, Magic Leap 2 feels like it’s just starting to scratch that ‘immersive’ itch, as you have more room to see the augmented content around you which means less time spent ‘searching’ for it when it’s out of your field-of-view.

While I suspect many first-time Magic Leap 2 users will come away with a ‘wow the field-of-view is so good!’ reaction… it’s important to remember that the design of ML2 (like its predecessor), ‘cheats’ a bit when it comes to field-of-view. Like the original, the design blocks a significant amount of your real-world peripheral vision (intentionally, as far as I can tell), which makes the field-of-view appear larger than it actually is by comparison.

Photo by Road to VR

This isn’t necessarily a bad thing if only the augmented content is your main focus (I mean, VR headsets have done this pretty much since day one), but it’s a questionable design choice for a headset that’s designed to integrate your real-world and the augmented world. Thus real-world peripheral vision remains a unique advantage that HoloLens 2 holds over both ML1 and ML2… but more on that later.

Unlike some other AR headsets, Magic Leap 2 (like its predecessor) has a fairly soft edge around the field-of-view. Instead of a hard line separating the augmented world from the real-world, it seems to gently fade away, which makes it less jarring when things go off-screen.

Another bonus to immersion compared to other devices is the headset’s new dimming capability which can dynamically dim the lenses to reduce incoming ambient light in order to make the augmented content appear more solid. Unfortunately this was part of the headset that I didn’t have time to really put through its paces in my demo as the company was more focused on showing me specific content. Another thing I didn’t get to properly compare is resolution. Both are my top priority for next time.

Photo by Road to VR

Tracking remains as good as ever with ML2, and on-par with HoloLens 2. Content feels perfectly locked to the environment as you move your head around. I did see some notable blurring, mostly during positional head movement specifically. ML1 had a similar issue and it has likely carried over as part of the headset’s underlying display technology. In any case it seems mostly hidden during ‘standing in one spot’ use-cases, and impacts text legibility more than anything else.

And while the color-consistency issue across the image is more subtle (the ‘rainbow’ look), it’s still fairly obvious. It didn’t appear to be as bad as ML1 or HoloLens 2, but it’s still there which is unfortunate. It doesn’t really impact the potential use-cases of the headset, but it does bring a slight reduction to the immersiveness of the image.

While ML2 has been improved almost across the board, there’s one place where it actually takes a step back… and it was one of ML1’s most hyped features: the mystical “photonic lightfield chip” (AKA a display with two focal planes)—is no longer. Though ML2 does have eye-tracking (likely improved thanks to doubling the number of cameras), it only supports a single focal plane (as is the case for pretty much all AR headsets available today).

Continue on Page 2: Different Strokes for Different Folks Enterprise Use-cases »

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HoloLens Chief Alex Kipman to Leave Microsoft Amid Misconduct Allegations

Alex Kipman is leaving Microsoft amid what an Insider report alleges to have stemmed from misconduct allegations leveled at the HoloLens co-creator.

The report maintains that Microsoft Cloud head Scott Guthrie is planning a reorganization of the departments, as Kipman is set to leave the company in the next two months as a part of transition process.

According to an email obtained by Insider, the company’s mixed reality hardware teams will join the Windows and Devices organization, which will be led by Panos Panay, whilst MR software teams will join the Experiences and Devices division under Jeff Teper.

The report details alleged actions by Kipman, including inappropriate behavior such as  “unwanted touching” of women employees and an instance wherein Kipman viewed an adult VR video in front of other employees.

“Managers warned employees not to leave women alone around Kipman,” the report maintains, according to three affected sources.

Insider says “[m]ore than 25 employees shared their experiences as part of a report that was compiled about Kipman.”

Military version of HoloLens (IVAS) | Image courtesy Microsoft

A former colleague told Insider that the pandemic was “[t]he best thing that happened, sadly,” as no one on the team had to interact with him personally.

Kipman hasn’t responded to any of these allegations. Microsoft also declined to confirm or deny the specific allegations against Kipman, however the company says it’s investigating every report and “for every claim found substantiated there is clear action taken.”

This follows a Business Insider report from earlier this year that cast doubt on a prospective HoloLens 3 amid an internal division that may have hobbled the company’s efforts to release its next AR headset as planned.

That earlier report maintained that progress on fulfilling its $22 billion US defense contract, which aims to put HoloLens in battlefield roles over the next 10 years, has been stymied by internal production issues.

An alleged internal rift stemming from competing designs, one of which would completely reposition HoloLens as a consumer AR device, were citied as reasons for the lack of progress on release of the next-gen device.

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Microsoft HoloLens Boss Alex Kipman Leaving Due to Misconduct Allegations

As the co-creator of Hololens and the chief of Microsoft’s mixed reality division, Alex Kipman has been the face of the company’s immersive efforts for several years now. That’s all coming to an end, with reports stating that Kipman will be leaving Microsoft after allegations of verbal abuse and sexual harassment surfaced.

Microsoft HoloLens 2

Insider reported the allegations back in May and it was the same site this week that first reported on Kipman resigning his position. While Microsoft has yet to officially comment on the report, Geekwire obtained an email from Scott Guthrie, the head of Microsoft’s Cloud & AI Group, announcing a restructuring of the Hololens group.

The hardware and software teams will be split between the Windows + Devices organisation and the Experiences + Devices division respectively. This hasn’t been an overnight decision it seems, with Guthrie stating in the email that: “Over the last several months, Alex Kipman and I have been talking about the team’s path going forward. We have mutually decided that this is the right time for him to leave the company to pursue other opportunities.” Kipman won’t be leaving right away. He’ll help the team’s transitions over the next couple of months before departing Microsoft.

What this will mean for Hololens is unclear as Kipman was by far Hololens’ (and mixed reality’s) most ardent supporter within Microsoft. The news comes at a turbulent time for the device as the US Army decides whether to continue with HoloLens development – called IVAS – for its soldiers, with reports suggesting that the 10-year, $21.9 billion USD contract might be delayed or reduced in size.

Microsoft Ignite, Alex Kipman and John Hanke
Alex Kipman and John Hanke at Microsoft Ignite

A Brazilian engineer, Kipman joined Microsoft in 2001 and worked within the Windows and Xbox teams – he helped create the Xbox Kinect sensor – before heading up the mixed reality division. Insider’s report last month saw dozens of staff detail his alleged behaviour to the publication. These included one employee saying Kipman watched what was essentially VR porn in front of others whilst another spoke of an incident where he kept massaging a female employee’s shoulders even though she was trying to shrug him off.

It was this pattern of continual inappropriate behaviour and unwanted touching that created an atmosphere where managers reportedly told staff women shouldn’t be left alone with him.

At the beginning of the year, the Wall Street Journal reported on more than 70 staff from the Hololens team leaving Microsoft in 2021, with 40 of those joining Meta.

For continued Hololens updates, keep reading gmw3.

Innovations in AR: Heavy Industry

Augmented reality (AR) is a key pillar of Industry 4.0 (or the fourth industrial revolution), side-by-side with other potentially transformative technologies like machine learning and big data. Indeed, consultancy firm PwC has estimated that industrial manufacturing and design is one of the biggest areas for augmented and virtual reality (VR), with their use in heavy industry having the potential to deliver a $360bn GDP boost by 2030.

In this latest edition of our series on how augmented reality is faring across a range of industries, we’ll be taking a closer look at why AR is proving so useful in heavy industry, in particular the fields of construction, manufacturing and energy.


AR is proving to be a key tool for the construction industry, whether in the design stage or actually in the construction process itself, leading a 2020 study of the architecture, engineering, and construction (AEC) industry to say that AR and VR would see “strong growth” in the next 5 to 10 years.

On the design side, numerous architectural tools exist to help with space visualisation using augmented reality. One such example is The Wild, which allows designers to view 3D models in both virtual and augmented reality. Such tools can layer virtual details onto a building plan so that plans can be more readily understood by stakeholders. 

That requires highly detailed and accurate 3D models, which is where the technology overlaps with digital twin technology. Using those digital twins, companies like Akular can enable clients to see what a building would look like on-site in the real world before it is built via a mobile application.

When it comes to actual construction, augmented reality again finds a number of uses, not least training workers on safety. That might involve AR headsets that interact with tags on potentially dangerous areas to bring up safety information, but even before workers are on-site, AR can help with training them on how to use heavy machinery – as with the construction equipment training simulators offered by CM Labs or the Arvizio AR Instructor.

Arvizio AR Instructor

“Industries are experiencing a shortage of skilled front-line employees and view augmented reality as a means to accelerate training and efficiently transfer the expertise of experienced workers,” said Jonathan Reeves, CEO of Arvizio. “Arvizio enables organizations to rapidly upskill employees without the need for on-site coaching and mentoring. By delivering no-code authored augmented reality instruction and remote expert connectivity, AR Instructor can substantially increase productivity and reduce errors of workers performing complex operational activities.”

Meanwhile, progress capture and tracking functionality directly compares real-world sites with virtual models to ensure they aren’t deviating – all in real-time. A host of companies provide variations on that technology such as VisualLive, which enables users to witness 3D models in real life via headsets such as the Microsoft HoloLens or mobile devices.


Much of the technology we’ve covered for construction can equally apply to the manufacturing industry, whether that’s learning how to use dangerous equipment or visualising the layout of equipment and machinery in a factory. None of this is to say there aren’t plenty of bespoke uses for augmented reality in the manufacturing space, however.

One early pioneer was Volkswagen, which was using augmented reality to assist service workers way back in 2013. The MARTA app showed step-by-step instructions on how to repair and replace certain components, overlaying its advice on the car via an iPad app. Along similar lines is Boeing’s more recent use of augmented reality to give technicians real-time, hands-free, interactive 3D wiring diagrams. 

Interestingly, that technology has bled over into the consumer space with AR manuals that assist car-owners with basic maintenance operations by showing precisely where components are located within a car.

In the design space, AR has been deployed by the largest manufacturers to rapidly iterate and do away with expensive and time-consuming physical prototypes. In the case of Ford and its partnership with HoloLens, changes can be made to a design and reflected in real-time to collaboratively sculpt a new vehicle.

AR has been trusted at the very highest levels of manufacturing, too. Lockheed Martin utilised augmented reality in the creation of NASA’s Orion Spacecraft, overlaying information to help with mission-critical procedures such as precisely aligning fasteners.

Nasa Orion HoloLens


In the energy sector, AR has the potential to remedy significant problems faced by the industry, chief of which is a brain drain caused by an ageing workforce. Indeed, the US Department of Labor estimated in 2019 that 50% of the current energy utility workforce will retire within the next ten years. The institutional knowledge being lost could be replenished more quickly with the help of AR technology.

Shell is duly using the remote collaboration possibilities of AR to educate workers in the field. Expert consultants are able to see through a worker’s eyes via an AR headset, and even draw on the screen of the augmented reality display they are using. That increases safety as workers interact with potentially dangerous heavy oil and gas equipment, as well as allowing experienced but ageing employees the ability to work remotely.

Shell AR
Image credit: Shell

The energy sector is no slouch when it comes to more specific AR solutions either, such as Upskills’s Skylight platform which allows companies to more easily develop bespoke augmented reality apps for use with AR devices, ranging from Google Glass to Microsoft HoloLens 2 and mobile devices. Then there are solutions such as Adroit, which can provide guidance on repairing high-stakes equipment such as oil rigs by scanning and identifying faulty components and machinery.

Final Thoughts

In heavy industry, where the costs of prototyping are enormous and the potential risks from machinery are significant, leaning on the virtual possibilities of augmented reality is common sense – hence the interest in the technology from across the sector.

To find out more about how AR is progressing in other fields, read the previous entry in the series, where we explored the healthcare industry in particular.

Report: Microsoft Braces for Negative Field Tests of Military HoloLens

Microsoft is supposedly gearing up to field test its HoloLens-based military AR headset, however a new report contends the company is bracing for impact, as it’s expecting negative feedback from soldiers.

Last year, Microsoft announced it had won a United States Army defense contract worth up to $22 billion which would see the development of a so-called Integrated Visual Augmentation System (IVAS), a tactical AR headset for soldiers based on HoloLens 2 technology.

A Business Insider report, citing a leaked internal email, maintains that Microsoft has low expectations for its latest version of IVAS, which is set to begin real-world operational tests with the US Army in May.

Prototype testing (2019), Image courtesy CNBC

Microsoft’s IVAS contract has allegedly seen delays and quality problems. A separate Business Insider report from last month alleges its enterprise-focused HoloLens 3 may also be at risk due to internal issues within Microsoft’s mixed reality division surrounding whether HoloLens should serve consumers or continue courting enterprise companies.

A purported Microsoft Teams message from Mixed Reality division head and HoloLens co-inventor Alex Kipman paints a pretty depressing story:

“So depressed, so demoralized, so broken. I’m sure by now you’ve read or heard about one or two of the Business Insider articles that were published on us. On our private roadmap. On our customers’ confidential data … as a consequence of these articles and these individuals shameful actions, someone from finance already came to me to ask if we should lock down and not share so openly our numbers. Someone from marketing already came to me and asked if we should lock down and not share so openly our roadmap. Someone for from our National Intelligence and Security Team already came to me to ask if we should lock down our IVAS work.”

Kipman rebuffed the previously report of unrest, saying “don’t believe what you read on the internet.”

It’s said that soldiers may take issue with the device’s low light and thermal imaging performance, and that user impressions will “continue to be negative as reliability improvements have been minimal from previous events.”

That $22 billion is an upper target and not the full amount granted to Microsoft at present. And it seems confidence in the project isn’t very high at the moment, as US Congress has allegedly frozen $394 million from the Army’s IVAS budget, which Business Insider notes leaves only $405 million—around $200 million shy of what Microsoft supposedly needs to recover development costs.

Additionally, it’s also said some close to the project fear the Army will simply walk away from the contract.

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Report Casts Doubt on HoloLens 3, Microsoft Says AR Headset is “doing great”

Microsoft’s enterprise-focused HoloLens 3 may be dead in the water, as a recent report maintains that internal divisions have hobbled the company’s efforts to release its next AR headset as planned. In the days following the report’s release, HoloLens co-creator Alex Kipman responded, saying “don’t believe what you read on the internet.”

Business Insider report from earlier this month maintains that plans to release HoloLens 3 are shifting behind the scenes. This comes alongside an alleged partnership with Samsung that would see the development of a wholly new consumer AR device that is rumored to tether to a Samsung smartphone.

This has allegedly caused divisions within the company surrounding whether HoloLens should serve consumers or continue courting enterprise companies. Rubén Caballero, Microsoft’s mixed reality and AI device engineering VP under Kipman, is reportedly pushing to focus on consumers, whereas the company has historically geared HoloLens for enterprise and the military.

Alex Kipman wearing HoloLens 2, Image courtesy Microsoft

Making an AR headset accessible enough for consumers is a vastly different challenge to producing higher cost enterprise headsets—just ask Magic Leap. If true, it would represent a significant change of course for the HoloLens product line.

There’s some ostensible background radiation related to employee attrition here too. The team has demonstrably thinned out over the last few months, with HoloLens veterans such as principal optical architect Bernard Kress leaving the company recently for Google Labs. A number of other high-profile members, including mixed reality technical fellow Don Box, engineer of computer vision Dave Reed, and former HoloLens engineering director Josh Miller have all left for Meta, along with a reported 70 others over the past year.

The report maintains progress on fulfilling its $22 billion US defense contract, which aims to put HoloLens in battlefield roles over the next 10 years, has also been stymied by internal production issues.

Microsoft Responds

Microsoft spokesperson Frank Shaw reaffirmed HoloLens’ importance to the company, telling Business Insider that HoloLens is “a critical part of our plans for emerging categories like mixed reality and the metaverse. We remain committed to HoloLens and future HoloLens development.”

HoloLens co-creator Alex Kipman also voiced his concern via Twitter, but declined to comment on the specifics.

In a follow-up tweet, Kipman says he hopes HoloLens 3 will be as “mind blowing” of an upgrade as the 2019-era HoloLens 2 was over the 2016 version, both of which were class-leading standalone AR headsets.

‘IVAS’ configured HoloLens 2 for US Defense, Image courtesy Microsoft

Kipman’s openness about the existence of the next HoloLens signals at least that Microsoft isn’t throwing in the towel, although the report may suggest Microsoft is moving forward with a more software-forward approach with AR instead of solely hocking its own hardware—pretty much par for the course for the company.

If those claims can be believed, it’s also possible HoloLens 3’s focus has changed so drastically that the device is no longer purely enterprise-focused, but instead split in two separate projects: one to service the US military contract and another to appeal to consumers.

In any case, Samsung’s reported partnership with Microsoft sounds like very familiar territory for the South Korean tech powerhouse. Samsung partnered with Oculus (now Meta) back in 2014 to build Gear VR, a snap-in VR smartphone holder that was a generational leap in terms of low-latency mobile VR.

And as Microsoft no doubt looks to compete with Meta and Apple, both of which are making strides to release AR headsets for consumers in the near future, we’re sure to see its strategy out in the open sooner rather than later.

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