![]() The contract to build IVAS was once said to be worth as much as $22 billion to Microsoft. At the time, Microsoft insiders said that the company was instead focusing its mixed-reality hardware efforts on a similar but more specialized device for military use called the Integrated Visual Augmentation System (IVAS). Microsoft's headset for the US Army is falling shortĪs Insider reported earlier this year, Microsoft scrapped plans for the next generation HoloLens device, internally called Project Calypso. "Microsoft is committed to all aspects of mixed reality and the metaverse," Shaw said. ![]() Shaw declined to comment on Eolian and referred IVAS questions to the Army. He did say that Eolian leadership has "zero interest in selling the company." Microsoft once considered acquiring the startup to bolster its effort to build the HoloLens-like devices for the Army, according to a person with knowledge of the HoloLens order and acquisition talks.Įolian cofounder Mike Simmons confirmed to Insider that it purchased the headsets for the "relatively accurate" amount of $1 million, but declined to provide more details on the deal or whether acquisition talks occurred. Meanwhile, those insiders say the biggest bulk-purchase sale of HoloLens devices in recent memory is a sale of $1 million worth of the devices to a startup making mixed reality for the government and public sector called Eolian. Even if all of those devices sold for full retail price, that would put the device's lifetime revenue at around $200 million. That would be a significant amount for a device one former employee estimates has sold between 40,000 and 60,000 devices since its 2016 launch. However, insiders suggest that the math doesn't quite add up.Įach current-model HoloLens 2 headset has a sticker price starting at $3,500, meaning Microsoft would have to sell around 30,000 units in three months at full price to meet that projection. Publicly, Microsoft has projected confidence: A slide in a recent Microsoft presentation to investors suggests the company is expecting $100 million in HoloLens augmented reality device revenue in its next quarter alone. "The devices would have gotten us killed," one tester said of the current iteration of Microsoft's device for the military, in an excerpt of an Army report dictated to Insider, owing to the light generated by the goggles when they're active. And the special headsets Microsoft is making for the battlefield are still falling short in some areas. One insider said that there's "no roadmap to speak of" for HoloLens as Microsoft instead focuses on the Army contract. Now, months later, Microsoft insiders say the company's metaverse and mixed reality ambitions remain uncertain amid canceled projects, budget cuts, a struggling contract with the United States military, and lack of leadership. Alex Kipman, who led metaverse strategy, left after an Insider investigation into misconduct allegations. In June, Microsoft's Mixed Reality unit - responsible for the HoloLens goggles and other nascent metaverse projects - saw a huge shakeup. Microsoft's US Army smart-goggles project is falling short, though it continues to move forward.While "Alex needed to go," insiders say, the mixed reality unit split up after his exit and left a leadership vacuum.HoloLens chief Alex Kipman left Microsoft in June after an Insider report on misconduct allegations.
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