Bloomberg confirms Apple is developing an Augmented Reality headset

Following other rumours Bloomberg’s Mark Gurman has confirmed that Apple has started development of an Augmented Reality headset, and has ordered small quantities of near eye displays needed for such a device.

The headset is believed to be powered by an iPhone, which Gurman calls the “hub” of Apple’s ecosystem and is expected, if development is successful, to hit the market in the 2018 time frame.

The glasses are expected to compete with Microsoft’s HoloLens, which also offers an untethered augmented reality experience, rather than Google’s Daydream virtual reality headset, with Tim Cook recently saying “My own view is that augmented reality is the larger of the two, probably by far, because this gives the capability for both of us to sit and be very present talking to each other, but also have other things visually for both of us to see.”

By being tethered to an iPhone the device will likely have a cost advantage over the HoloLens, which is a compact full PC, but by then Microsoft should have built out an ecosystem of Virtual Reality and Augmented Reality OEMs based on its Windows Holographic platform, with a large number of headsets running the OS expected to ship by the end of 2017.

Gurman notes that Apple is currently looking for the next big thing as a follow-up to the Apple Watch, but outside observers may note that Apple has so far failed to follow-up on the success of the iPhone, with the iPad seeing more than two years of year on year sales declines and the Apple Watch never really catching on. With the Apple Car rumoured to have been in intense development and then cancelled, it appears Apple’s ability to move the market and provide a serious threat to competitors is becoming less and less of an issue.