Why Did Apple Abandon Its AR and VR Headset Dreams?

Apple (NASDAQ:AAPL) has scrapped its plans for augmented reality (AR) and virtual reality (VR) headsets, according to Taiwanese news site DigiTimes. It reportedly disbanded its AR/VR headset unit in May, four months after Avi Bar-Zeev, a key team member who co-created Microsoft's (NASDAQ:MSFT) HoloLens, left Apple. Apple never clearly outlined its AR/VR plans, but it acquired several AR/VR firms, assembled a team of AR/VR experts, filed patents for an AR/VR headset for the iPhone, and added depth-sensing cameras and computer vision chips to its newer iPhones for AR apps. Apple also launched ARKit, an API (application programming interface) that lets iOS developers build more advanced AR apps. Google offers a similar API, ARCore, for its higher-end Android devices. A CNET report last year claimed that Apple was developing a stand-alone wireless AR/VR headset codenamed T288, which sported an 8K display for each eye. That marked a multi-generational leap over any other AR/VR headset -- Microsoft's new HoloLens 2 and Facebook's new Oculus Quest both offer just 1440p displays for each eye. CNET claimed that Apple could launch the headset in 2020. However, DigiTimes claims that the device wasn't light enough and couldn't function optimally without 5G support. The production cost was also likely too high. As a result, Apple scrapped the project and transferred its team members to other divisions.