Virtual and augmented reality (AR) may well signal the future of online collaboration with the ‘new normal’ promised by the Covid-19 pandemic – but it may have come a little too late for Magic Leap.
The AR hardware firm has announced major layoffs and a move towards the enterprise ahd hardware markets, with some reports suggesting that up to half of the company’s workforce is to go.
In a blog post, Magic Leap CEO Rony Abovitz outlined the ‘painful process’ of restructuring, with layoffs expected across the business, from executive to factory floor level. “While our leadership team, board, and investors still believe in the long-term potential of our IP, the near-term revenue opportunities are currently concentrated on the enterprise side,” Abovitz wrote.
The company released its original Magic Leap One Creator Edition headset in August 2018, with many in the industry – including this publication – noting that, with $1.8 billion raised in funding by October the previous year, it wasn’t before time. At a starting price of $2,295 USD, its place at the higher end of the market was assured. Critical response was relatively positive, although according to The Information at the end of last year, sales did not follow in the same vein.
The next-generation Magic Leap 2, according to Abovitz in a Forbes interview around the same time, was slated for a 2021 release, with the enterprise and ‘early prosumer’ market firmly in its sights. Updates from the company, such as an extension of its partnership with industrial software provider PTC, signalled this change.
Abovitz added in the blog post that the changes were necessary to advance Magic Leap’s technology, as well as ensure delivery of Magic Leap 2. “We must decrease investments in areas where the market has been slower to develop, providing us with a longer runway while retaining the ability to explore and build on future use cases when the market signals readiness,” he added.
Plenty of innovation remains in augmented reality right now, with various initiatives looking to put a positive spin on the current crisis. PTC is using its augmented reality technology to help produce more ventilators in the UK, it was reported this week, while alternate realities are being advocated by industry figures as a way for people to explore ‘outside’ if they are stuck at home.
“The post-Covid economy will be one of resiliency and the ability for businesses to operate across vast distances and connect with their customers in ways that mimic physical interactions, but benefit from the speed and scale of high-speed networks, will be critical,” wrote Abovitz. “Spatial computing will very much be part of that coming economic change.”
Many former Magic Leap employees have taken to LinkedIn to note their change in circumstances, including chief content officer Rio Caraeff, who said he was ‘forever grateful for the amazing learning experience’, and senior director of Magicverse Chris Matthieu, who said he was ‘still a huge believer’ in AR, VR, spatial, and decentralised edge computing.
You can read the full blog post here.
Picture credit: Magic Leap
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