Reporting by XinZhiyuan
Editor: Good sleepy Yuan Xie
In early February 2022, Microsoft's mixed reality headset HoloLens 3, which could not be released for a long time, was revealed by company insiders that it had been killed. In this regard, the official spokesperson and the project leader have publicly denied it.
On Feb. 3, Insider said in a lengthy article that Microsoft had killed the HoloLens 3 project. Among them, a number of people familiar with the matter revealed that this is the end of Microsoft's mixed reality (MR) headset project.
However, Microsoft spokesman Frank Shaw immediately denied that the HoloLens project was dead. Project leader Alex Kipman also said on Twitter that "don't be gullible to the news seen online, there were people who said Hololens 2 was also canceled" before.
In this regard, netizens said, "You are also publishing news on the Internet."
Insider continued to follow up with the report, interviews with Microsoft's internal employees, many people confirmed that the future will be with Samsung's headset cooperation project, the new Microsoft MR headset is likely to be a non-Windows-based cloud computing device, HoloLens 3 is really cold, and so on.
Is there any drama in HoloLens 3, is it an official announcement, or is it a roadside gossip?
In any case, one thing is certain: Microsoft has long-term grand plans for the metaverse.
The third-generation HoloLens ran aground?
At a 2019 all-hands meeting before the coronavirus epidemic, according to those present, Microsoft Chief Marketing Officer Chris Capocella said that HoloLens is a nice gadget for promotional videos, but it is only an "approximate error value" for Microsoft's business.
A few years later, the tech industry saw a huge business opportunity to immerse users in the digital augmented reality and virtual world.
However, Microsoft's HoloLens business, despite its early start, doesn't look like a pre-investment that's starting to pay off, but more like a chaotic mix of engineers and visions that are exploring directions.
According to Insider, three insiders said Microsoft had canceled plans for the HoloLens 3 in recent months.
One person expects this to be the end of the project, at least for the well-known HoloLens family of products.
In addition, Microsoft agreed to work with Samsung to develop a new mixed reality device, which stirred up disagreements within the team.
Patience is being lost
Microsoft's HoloLens device was sought after and awe-inspired when it was unveiled in 2015.
The wearer can see through the glasses that digital information is superimposed on their view of the physical world, for example, showing a manual that a technician can catch a glimpse of while repairing an appliance.
Unlike Google, which moved into industry after failing its attempts to bring it to the consumer market, Microsoft positioned HoloLens as an enterprise product from the start.
In the early days of the HoloLens, the department had a bad check from Microsoft, guaranteed by HoloLens creators Alex Kipman and Kudo Kakuda. Insiders say the two are masters at convincing leadership to invest in their vision.
Like many tech companies that invest billions of dollars in research and development, Microsoft often takes a long-term view of experimental or strategic projects.
Microsoft, for example, spent $10 billion developing Bing, a search engine that rivals Google, and it sustained a lot of losses before making a profit.
At this point, however, the mixed reality business has been around for about a decade in a variety of ways, and insiders say executives, including Chief Financial Officer Amy Hood, want the division to focus on businesses that generate significant revenue.
Early promotional videos for the HoloLens family of products promised hospital customers a future that could change the way surgery is done
For an entirely new product category, Microsoft has scored some impressive early wins, signing deals to sell HoloLens devices to big customers like Ford and elevator maker ThyssenKrupp.
But one former employee estimates that HoloLens has sold a total of 40,000 to 60,000 devices since its launch in 2016. Even at HoloLens' current price of more than $3,500, that leaves the business insignificant in Microsoft's $168 billion annual revenue.
Wobbly targets
In recent months, there has been significant disagreement among different factions in the mixed reality division over whether to redouble their efforts to develop their own hardware, or devote more effort to building a software platform for the metacosm, and whether they should continue to focus on Microsoft's major enterprise customer base or create products for consumers.
It's unclear which of these different visions for the future of the department, if any, is currently more favored by management.
Even the "meta-universe" that Microsoft attaches the most importance to now cannot find the north.
In March 2021, Microsoft launched this new mesh, which aims to create applications that enable people to collaborate remotely through AR/VR technology.
It's a virtual platform with 3D avatars and other XR capabilities and leverages the Azure cloud platform to facilitate remote participants sharing a collaborative experience through HoloLens 2 and other devices.
In November 2021, Microsoft announced plans to turn its Microsoft Teams into a "metacosm", starting its march.
CEO Nadella shared the experience scene in the mixed reality conference platform Mesh, where people can meet and interact through avatars, and share Office files.
In addition, Mesh for Teams can pre-build a range of immersive spaces that support a variety of environments such as meetings and social events. For example, play table tennis, use a whiteboard for color-coded tasks, or even display product prototypes on a table.
In the future, Microsoft will introduce a new 3D avatar, users will no longer need a VR headset to use the new features.
So if you don't want to turn on the camera, you can choose to use animated characters instead of yourself, and interestingly, the platform will make your face move according to the voice prompts.
In January 2022, Microsoft spent 68.7 billion yuan to acquire Activision Blizzard, once again expanding the "first version" of the meta-universe in hand.
The acquisition includes iconic IP from Autovision, Blizzard and King Studios, including Warcraft, Diablo, Overwatch, Call of Duty and Candy Saga, as well as global esports events through Major League Baseball.
Microsoft CEO Satya Nadella said: "Gaming platforms are the most dynamic and exciting of all platforms today, and will also play a key role in the development of metaversal platforms."
Prior to this, Nadella had said, "Actually, a lot of our current games are a metaverse in themselves. Halo, for example, is actually a metaverse. Minecraft and Flight Simulator are also metaverses."
Behind the seemingly smooth progress, however, is something that even people inside Microsoft don't know: how HoloLens fit into this wave.
"The big question is what exactly the team is focusing on, and that's uncertain. The Mesh platform is something that everyone is focusing on, but what are the components? What are we trying to convey? It's quite frustrating to see the team shift its focus to a new, uncertain strategy."
While Nadella wants to ensure that Microsoft becomes the software maker of the metaverse, no matter who is making the hardware, just as the Windows operating system is used for a variety of different devices.
But some people familiar with the matter revealed that the overall metacostem strategy is not clear and seems to be changing.
A former employee said that the hardware business is the "darling" of Kipman, the head of the mixed reality department.
Microsoft said in the mesh platform promotional video: "This will be the moment when users are closest to Iron Man."
And this strange contradiction runs through almost the entire department.
In 2020, Microsoft hired Ruben Cabalero, Apple's vice president of engineering, to take charge of device engineering for mixed reality and artificial intelligence.
Caballero was involved in the design and production of the first iPhone and iPad, and according to one source, he joined Microsoft to beat Apple in releasing mixed reality headsets for consumers.
For Ruben Caballero, he wants the team to focus on consumers and metaversities.
Similarly, Kipman said last year that Microsoft intends to release a consumer version of the HoloLens.
Other team members, however, disagree with those who believe Microsoft should redouble its focus on the enterprise market and fulfill defense orders.
Spoof the four-frame picture of consumer reaction to the headset: "This shows that the quality is real... The machine will also prompt "No one loves you"."
Microsoft said the U.S. Department of Defense's Integrated Visual Enhancement System (IVAS) order is expected to be worth as much as $22 billion over 10 years.
Screenshot of an advertisement for IVAS
The cooperation with Samsung is to "add bricks" to the whole chaotic situation.
Originally, Microsoft had been hesitant to give up holoLens, at which point Samsung said that Microsoft provided software and Samsung produced hardware, which was the best combination.
According to one employee, the partnership was nothing short of a "bullshit show."
Some have even suggested that Microsoft should end its partnership with Samsung or do only the minimum amount of work contractually agreed upon in order to focus on its own projects.
Some sources say that Microsoft has already "killed" the HoloLens 3 in mid-2021, and around the same time, Microsoft began working with Samsung.
Samsung also does its own head show
Some sources have criticized Kipman for failing to quell infighting within its jurisdiction, not only within the hardware group, but also between the HoloLens application experience team and the cloud and infrastructure teams.
While Kipman and other leaders of the mixed reality team hold monthly "casual ask" meetings with employees, two sources revealed that leadership has largely failed to address issues raised at these meetings about declining employee morale, continued staff drops and project cancellations.
It's not uncommon for product designs to be altered or even thrown away throughout Microsoft's development process. But the speed with which the HoloLens project changed its strategy was truly unique.
A former employee said, "What we're told to do changes every month."
These contradictions and uncertainties made the team morale very low, and also made the team members doubt the promise of the HoloLens device.
According to the Wall Street Journal, more than 100 people have left Microsoft's mixed reality division in the past year, and many of them have gone to Meta.
This includes a veteran Microsoft employee with 20 years of experience, Mixed Reality Technology Researcher Don Box and Dave Reed, a 26-year outstanding computer vision engineer.
Microsoft says the mixed reality division has a strong team that has grown over the past year.
Spokesman Frank Shaw said, "HoloLens remains an important part of our plans for emerging areas such as mixed reality and metaverses. We remain committed to the growth of HoloLens."
Microsoft declined to comment on the partnership with Samsung, team dynamics and said Capossela did not recall commenting about HoloLens at the conference. Samsung did not respond to requests for comment on the partnership.
HoloLens roadmap
Microsoft's virtual reality business is about to undergo major technological changes, abandoning the operating system that continues to do MR devices with windows systems that drive the current HoloLens family of products. This could reduce costs associated with device complexity, but also end Microsoft's strategy since launching HoloLens.
The product roadmap for Microsoft's mixed reality headsets dates back nearly a decade.
Microsoft's first attempt at mixed reality devices, known internally as "Fortress City," separated computing from display and wore it around the waist as a sphere. The version that would later become holoLens was eventually canceled as "unfeasible" and never hit the market.
Microsoft then turned to "Project Baraboo," producing the original HoloLens device as we know it today, which debuted in 2015 and was released in 2016. The device was the first stand-alone mixed reality device, with all the computing hardware placed inside the headset.
Netizens spoofed the HoloLens conference: "This action, really a testicular cancer self-test simulator, saved my life"
Shortly after the release of the first HoloLens, Microsoft began working on what was supposed to be a HoloLens 2, but this was also canceled. Kipman said the new device isn't an improvement over the original HoloLens, and there's no need to rush to launch new devices because he doesn't see competitors in the market.
The version that was eventually released as HoloLens 2 in 2019 came from a later project called "Sydney".
Microsoft is currently developing a customized product based on HoloLens technology for the U.S. military, which could be worth as much as $22 billion as part of the contract. The project was called "Delaware," and the device itself was called "Atlas" within the company.
The high-profile Pentagon contract, which added to holoLens' image, fell far short of expectations and was plagued by quality and performance issues.
IVAS prototype machine field test photos for fall 2021
The Pentagon Test Office report also shows that Microsoft's system has "not yet demonstrated the ability to act as a combat goggle."
According to a december 2021 public statement by the U.S. Department of Defense's IVAS program director, although there is no corresponding mass-market product, Microsoft's latest product to meet the defense contract is almost what its Hololens 3 can do.
Other U.S. military spokesmen said officials were aware of the claim, but the news was released without permission.
Spoof GIFs made by American netizens for the news that "Microsoft can not finally deliver IVAS"
Next Generation MR: Cloud-Based "Samsung Lens"?
For the "debunking" of Kipman, the head of the mixed reality department, people familiar with the product roadmap said that this is complete nonsense.
Unequivocally, the project, code-named "Hidden Narcissus," was terminated. All the people who work on this job have been assigned to other projects or have left the company.
HoloLens 3 operates as the previous two releases, a standalone computer operating on Windows, but will be more rugged, have longer battery life, and can be used outdoors.
The termination of HoloLens 3 development allowed Microsoft to focus its engineering resources on other projects, including Bondi, which was created in partnership with Samsung. Unlike the logic of the HoloLens, the device will use a Samsung phone as the computing platform.
While Microsoft hasn't recently planned to launch another HoloLens-like headset that runs on Windows, people familiar with the matter say the company is planning to launch a vision device with forward-looking capabilities that resemble edge devices, with computing in the cloud.
It's unclear whether Microsoft will call the device HoloLens, after all, the project is still in its infancy and could still change a lot.
Netizens found that the 2015 Hololens styling was almost the same as the prop styling of the 1985 movie "Back to the Future"
Microsoft first disclosed HoloLens in January 2015 as part of a grand unveiling of its Windows 10 operating system. The claim at the time was that HoloLens would run a dedicated version of Windows 10, making it easier for developers to bring their Windows applications to their headsets.
Sources said the cancellation of HoloLens has put Microsoft no longer at the heart of its next big push for augmented reality technology.
While it's unclear what operating system the cloud version will use, if it's based on a Samsung smartphone, it's likely to be Android.
However, whether it's porting from the old HoloLens platform or Microsoft switching the system back to Windows in the future, HoloLens developers estimate that they will need to rewrite some or all of their software from scratch, or even more than once.
Resources:
https://www.businessinsider.com/microsoft-hololens-3-metaverse-mixed-reality-strategy-confusion-rivalries-2022-2
https://www.businessinsider.com/microsoft-hololens-3-canceled-mixed-reality-product-roadmap-samsung-2022-2