Apple’s upcoming mixed reality headset (AR and VR) will apparently be “a pricey, niche precursor” to the company’s eventual augmented reality glasses, which is being described as a way more ambitious project that’s taking longer to develop than originally anticipated.

Development hurdles

That’s according to Bloomberg‘s well-informed reporter Mark Gurman, who this morning wrote about development hurdles plaguing the Cupertino giant’s first major new product category since the Apple Watch, which launched back in 20144.

The initial device has confronted several development hurdles and the company has conservative sales expectations, illustrating how challenging it will be to bring this nascent consumer technology to the masses.

Bloomberg previously reported about Apple’s AR/VR strategy.

Apple’s plan apparently involves augmented reality glasses that would run thin apps like messaging and social media apps, as well as support 360-degree video and more. As for the rumored headset, Apple apparently had two versions in development: one that offloads processing to the paired iPhone and the other a completely standalone product.

Apple’s mixed reality headset

The headset, codenamed N301, will be more focused on VR than AR, Gurman claims:

As a mostly virtual reality device, it will display an all-encompassing 3-D digital environment for gaming, watching video and communicating. AR functionality, the ability to overlay images and information over a view of the real world, will be more limited.

The headset was supposed to launch next year, going up against Facebook’s Oculus, Sony’s PlayStation VR and headsets from HTC. The device should use a custom Apple chip said to be faster than the M1 processor in the new Macs. One version of the headset even has a fan.

The powerful processors and the inclusion of a fan initially led to a device that was too large and heavy with some concern about neck strain in early testing. Apple removed the space VR gadgets usually reserve for users who need to wear eyeglasses, which brought the headset closer to the face and helped shrink the size. And to address consumers with poorer eyesight, it developed a system where custom prescription lenses can be inserted into the headset over the VR screens.

It’s said to use fabric rather than metal exterior for weight reduction, with prototypes featuring external cameras for hand-tracking and air typing. While rival headsets fall somewhere in between the $300-$900 price range, Gurman claims the Apple headset will be “far more expensive” than those from rivals.

Apple isn’t looking to create an iPhone-like hit for its first headset. Instead, the company is building a high-end, niche product that will prepare outside developers and consumers for its eventual, more mainstream AR glasses.

The AR glasses, codenamed N421, are still in an early stage of development and are “several years away”. For what it’s worth, Gurman says that Apple may unveil it in 2023.