Apple VR headset expected to 'stand on shoulders' of past product launches

As Apple's WWDC 2023 event begins on June 5th, IDC Research Director on Mobile Devices Ramon Llamas joins Yahoo Finance Live to break down what to expect from event.

Video transcript

- Well, shares of Apple hit a record high on Monday as the tech giant is gearing up for its Worldwide Developers Conference. And if the rumors are to be believed, it could be one of the biggest events for Apple in recent history.

Let's bring in Ramon Llamas, IDC Research Director of Mobile Devices, to weigh in here. So Ramon, obviously, we know this is a developers conference that's supposed to take all the shine. But of course, all this talk that we're hearing about, this mixed VR headset, what are your expectations for this big tech event?

RAMON LLAMAS: Wow, it's a rare occasion when Apple comes out with brand new hardware. And all of us, myself included, get incredibly excited about it. But you know, let's face it. There's a couple of things here, you know AR, VR, augmented reality, virtual reality, this is not a brand new market. Apple's not really creating something totally new.

But what Apple does and does really well and has a history of this is that they stand on the shoulders of the giants that have come before them and make a device and experience you know, so brand new, so easy to use, so user friendly so that even Joe and Jane Smith on Main Street, USA can look at and say, yeah, you know what, I think I want to get that. I want to give that a shot.

And because this is a developers conference, it's not just the hardware. It's the software, it's the apps that's really going to make this virtual reality or mixed reality headset pop. So let's just wait and see what exactly that you can do with this headset.

- I mean, and that's the point, because I mean, between the price tag, I mean, the early adopters, if this does get launched, they'll be all over it. But in terms of translating that into mainstream interest and use, how do you think that would best work with some of Apple's existing products and services?

RAMON LLAMAS: You know, and it's-- here's the thing, whereas a lot of other AR, VR vendors out there, they really come out with the device and maybe they're going to have a handful of applications. Apple can come at this rather differently and say, listen, not only do we have a device, we have a ton of services that we can tap into. We have Apple TV, we have Apple Music, we have Fitness Plus. And let's not forget an army, an army of developers and a lot of top brand names out there.

So when you kind of put this all together, Apple is one of those rare companies rather armed to the teeth in terms of what it can bring to the table. So it's not just Joe and Jane Smith on Main Street, USA saying, OK, I have a device. Now, I'm going to go find the applications. Now it's, I have the device, I can connect to all the services, which are probably already have.

And it's that seamless integration that's going to get people to come back again and again saying, you know, this isn't incredibly foreign. It's new, it's fresh, but at the same time, it's familiar. And I think that's one of the aces that Apple has up its sleeve to really make this a little bit more mainstream compared to some of the other devices that are out there.

- And we certainly saw they ended up doing that with the smartphone-- playing plenty of cell phone giants existed, and then Apple came in and changed the game. We'll see if they're able to do that here. Now, of course, this is a developers conference. So in terms of some of what we might see on the software side, what are your biggest expectations there?

RAMON LLAMAS: You know, here's the thing, the developers are going to be really excited about number one, not just all the new developments and changes, and I'll talk about that in a second. But if you take a look at-- you have iOS, which powers the iPhone, you have iPadOS for the iPad, macOS, the different versions for the Macs, watchOS, tvOS, and quite possibly, let's just call it vrOS or xrOS.

There's a lot of different ways for developers to get deeper into that Apple ecosystem. And that's what they're going to be really excited about. And obviously, that's all going to connect with all the different kind of hardware that's attached to that. But when you have a new OS like this virtual reality one, this is going to make a lot of developers say, hey, this is a new frontier that we can get in on that ground level and say, OK, you know what, we're going to have a new audience to tap into, new experiences, and new ways to be a part of that.

So you take a look at that kind of numbers potential. And at the same time, look how Apple makes it so incredibly gosh, darn easy for developers to come in and say, hey listen, we're going to make this easy-- we're going to make this convenient for you so that if you're coming up with their own application, to be able to port that or to build from the ground up. This is not going to be very difficult for you to do.

And by the way, we had that one thing that we know developers want, which is reach, having a terrific, almost I think Apple said 2 billion person or 2 billion device installed base worldwide. That's a lot of people to reach. And we have that many people to reach, whether it be something as traditional as iOS or macOS, or if you have something new as this X or OS, that's just fantastic numbers that you can try to sell your applications to, try to sell your experience to. And that's going to bring in eventually, money into developers.

- And Ramon, we have to talk about AI because that's something that basically comes up on every single earnings call. Apple, relatively quiet on that. What are the expectations for what we'll hear there? What do you think will make perhaps, investors happy versus, say consumers who can actually use some of these products?

RAMON LLAMAS: You know, I think A's been kind of the buzzword of 2023. Now, it's just a question as to how many other companies can really meaningfully attach to it. But here's what I really like to see out of Apple is this, is that they already make things so really easy for consumers to use.

Look, you don't even have to use-- you don't even have to look up the manual to try to complete certain tasks. You just open up your device, you can just fire it up, and you can just get in and get it going.

Now, is add AI to the mix, whether it be generative AI or something else where you can just say to your device, you know, hey, Apple, do this for me. And what I really hope would Apple will do is say, here you know what, let's solve a problem. Let's make that experience that much more convenient.

Because when you get right down to it, users and consumers, and I count myself as one of them, is that number one, I want to see how various devices and softwares and experiences that I own and use on a regular basis what they can tell me about me and what I could do better. And that's one of the holy grails of AI.

And then on top of that is that what else can-- what problems can AI solve? What conveniences can it bring forth to me so that I don't even really have to think about trying to concentrate and move towards my brain, towards something else to get it done. AI is going to handle that.

Now, to the extent that Apple can integrate that with all of its experiences, I think, eventually, they're going to have to put it into its various platforms. But let's see which one or which ones they start with, that's going to make the most sense. I mean, you don't want to just say, hey, we are AI powered, but we are AI powered and this is what it's going to do for you, this is how it's going to make your lives that much easier. And when you have something like that, when you build a better mousetrap, that's what's going to make consumers, and I think, investors much happier.

- I think so too, that sort of optimized experience there. I mean, it does give a little bit of "Wall-E" and "Ready Player One" vibes to it, but still early days. We'll see how that goes. Ramon Llamas, thank you so much, IDC Research Director of Mobile Devices. Thank you.