| Dear Reader,
I’m on record that I really like my Meta smart glasses.
They let me take photos without holding a phone. They let me ask an AI assistant a question about the Washington Monument while I’m walking through the National Mall. They’re light, comfortable and surprisingly useful.
But here’s the thing.
Although I’ve owned these $300 smart glasses for a few years, do you know how many hours I’ve spent inside Meta’s $70 billion virtual reality (VR) metaverse?
Almost none. And it turns out I am not the only one.
At this point, I’ve tried many VR devices. And while the hardware keeps getting better and the headsets keep getting lighter, most users seem to buy VR devices, play with them for a while and then put them in a drawer.
In other words, the gap between Meta’s vision of its Metaverse and real life never really closed.
And that gap is now forcing Meta to make big changes. | This company already has $26 BILLION in contracts with the Pentagon…
But it’s still private. So it’s off limits for most investors…
However, there's a little-known ticker symbol that could get you in before the IPO boom — starting with just $20.
Click here to see how. | Following the Momentum The metaverse had a huge head start. Facebook rebranded itself as Meta in 2021 and poured billions into VR hardware, software and avatars.
Mark Zuckerberg promised a new world where meetings, entertainment and social life all moved into immersive virtual spaces. It was a bold idea, and it captured headlines. It even inspired a wave of corporate imitation.
But inspiration doesn’t always translate to adoption. After Covid, we were all seeking more social interaction, not more isolation.
Recently, reports surfaced that Meta plans to cut up to 30% of the staff inside its Metaverse division. After more than $70 billion in cumulative losses at Reality Labs — and with little growth to show for it — executives are finally pulling back.
The timing says everything you need to know about why this is happening.
Because VR has not taken off like many hoped it would.  Source: demandsage.com Meta’s Quest VR headset shipments have stalled. Apple’s Vision Pro launched with huge hype and sold roughly 200,000 units, well below expectations. In fact, Apple has already cut next year’s production targets. And Google shut down its internal XR headset program in 2024 and reassigned staff so it could focus on becoming the operating system for VR.
Big Tech once fought to dominate immersive virtual reality. Now these companies are quietly backing away from it.
But that doesn’t mean Meta is killing its Metaverse.
You see, the company is now spending $30 to $35 billion a year on AI infrastructure. And that money has to come from somewhere.
That’s why Meta is shrinking the amount of money it’s dedicating to the Metaverse and redirecting those resources into a part of Reality Labs that is actually growing.
AI glasses and wearables.
Last year, Meta and Ray-Ban released an updated version of their smart glasses with better cameras, improved speakers and an onboard AI assistant.  Image: Meta According to Counterpoint Research, the company has sold roughly 1.3 million units so far. At an average price of around $300, that represents about $400 million in revenue.
Which doesn’t mean the glasses are profitable yet. But unlike VR, they are growing. Sales jumped about 70% last year.
That’s also why Meta is doubling down on augmented reality (AR). AR doesn’t replace your surroundings the way VR does. It enhances them by adding digital overlays, AI assistance and real-time information to your field of view.
Meta showcased this vision at its developer conference this fall, where the company introduced three new glasses, including a prototype with a tiny display built into the lens.
Zuckerberg also hired Alan Dye, the longtime Apple design executive who helped shape the look of the iPhone and Apple Watch, to lead a new design studio inside Reality Labs.
And that’s not all. Last week, Meta acquired Limitless, an AI wearable startup, for about $250 million.
And Meta isn’t alone in expanding its reach in AR wearables.
Google is working on its Project Aura glasses built with Xreal. Amazon is pushing a new version of Echo Frames. Snap continues to iterate on its AR Spectacles for developers. Even Apple is reportedly shifting resources from Vision Pro toward lighter AR designs after its first-generation headset underperformed.
All of this is happening because the data for AR adoption is pointing in one direction. Straight up.
The global smart glasses market is expected to 4X over the next five years, from less than $2 billion in 2024 to over $8 billion in 2030.  Image: grandviewresearch.com That’s what an emerging platform looks like.
And there are real-world enterprise cases for AR too.
DHL reported a 15% boost in warehouse picking efficiency using AR overlays. Boeing documented a 30% reduction in wiring assembly time. And surgeons are using AR for visual guidance.
There are also plenty of uses for AR in the military.
But VR has struggled to find its breakout use case. And when you step back, the “why” becomes obvious.
VR requires you to step into another world, while AR glasses improve the one you already live in by bringing AI into the real world.
This doesn’t mean the metaverse was a bad idea.
It was just the wrong interface at the wrong time. Here’s My Take VR will continue to matter in gaming, simulation and education. But the next major consumer platform won’t require a headset.
It will be wearable and lightweight. And it will be powered by AI.
AI glasses aren’t a niche experiment anymore. They have real sales, real investment and a real roadmap.
For the first time since the iPhone, we are watching a new interface gather speed.
Which doesn’t mean that AI glasses are a lock to become the successor to the smartphone. At least, not this year, and not all at once.
But the pieces are falling into place.
And it’s becoming clear that the next decade of computing will be defined by an interface that people actually want to use.
Regards, 
Ian King
Chief Strategist, Banyan Hill Publishing
Editor’s Note: We'd love to hear from you!
If you want to share your thoughts or suggestions about the Daily Disruptor, or if there are any specific topics you’d like us to cover, just send an email to dailydisruptor@banyanhill.com.
Don’t worry, we won’t reveal your full name in the event we publish a response. So feel free to comment away! |
Post a Comment
Post a Comment