Magic Leap had high hopes for sales of its augmented reality headset. Instead, the richly-valued startup has seen slow sales of the device, recent layoffs and executive turnover. In the coming years, competition in AR will likely intensify as bigger tech companies enter the market
Eventually, Magic Leap executives convinced Abovitz—an entrepreneur known for his bold predictions about how the company’s products will disrupt computing—to settle on a more modest plan of selling at least 100,000 headsets in the first year, eventually scaling up to millions of units with future iterations, according to three people with direct knowledge of the discussions.In addition to its high price, the $2,300 Magic Leap One early reviewers have criticized the headset for its limited field of view, lack of killer apps and a cumbersome design.
There is good news, however. Magic Leap is reportedly prototyping the Magic Leap 2 that features “5G compatibility, higher quality graphics, a wider field of view, greater depth perception and a smaller and lighter headset that comes in multiple colors”.
The bad news it that this headset is said to be years away from launch. In the meantime, Magic Leap may release a shorter-term update to its first headset with minor improvements.
Given that Apple is reportedly launching its own AR headset in 2022 and Apple AR glasses in 2023, Magic Leap will have to make serious improvements to its platform in order to stay in a game that will soon become a lot more competitive.
The report shows that Magic Leap had a “monthly burn” of around
$40-$50 million in the year 2018. The company’s raised over
$2.6-BILLION dollars from investors, the latest of which was NTT Docomo
in April of 2019 for another $280 million. On November 11, 2019, Magic
Leap announced that they were in the process of raising a “Series E
round of funding.”
Magic Leap assigned its patents to JPMorgan Chase back on August 20, 2019. This was revealed by KGuttag to be an assignment for collateral for a loan.
If you seek out document 505634859 08/22/2019 EPAS ID:
PAT5681665 you’ll find a shocking number of patents on the list with the
Nature of Conveyance as “PATENT SECURITY AGREEMENT.” This isn’t the
last we’ll hear about these patents, of that you can be sure.
Meanwhile, The Information reports that two high-profile board
members left quietly in 2018: Google CEO Sundar Pichai and former
Qualcomm executive chairman Paul Jacobs. Both cases involved extenuating
circumstances, though. Jacobs had been abruptly removed from Qualcomm’s
board after trying to organize a buyout, and Pichai’s schedule was
reportedly too busy, which makes sense given his expanding role
at Google’s parent company Alphabet. Pichai was also replaced by
another Google executive, Jennifer Fitzpatrick, so the company itself
hasn’t ditched Magic Leap.
Magic Leap also recently fired “dozens of employees” according to Heath. Sundar Pichai was made part of the Magic Leap board back in October of 2014 when Google first invested in the company, per the announcement back then. Pichai left the Magic Leap board in 2018.
Magic Leap will also have to contend with the much-improved Hololens 2 from Microsoft on the enterprise front, as well as an expected wave of consumer AR headsets and glasses that will leverage Qualcomm’s XR2 platform. Pokemon Go creator Ninantic has already announced that it is working on AR Glasses in partnership with Qualcomm.
Magic Leap will have a presence at CES 2020, so we may hear some announcements at that show.
