Apple, which recently became the world’s first $1 trillion company, have announced the acquisition of Akonia Holographics, a start-up maker of ‘holographic smart glass’. Part of a series of recent deals and executive appointments in the AR (augmented reality) space, the most recent deal points to Apple’s faith in what the company believes will eventually be the successor of the hugely successful iPhone series – AR headsets or ‘smart glasses’.
In the year 2000 Apple stock was trading at $1. Today, it’s just under $223. Apart from the fact that $100 invested in the company a little over 18 years ago would be worth $22,300 today (more with compounded returns if dividends had been reinvested) that spectacular rise shows just how successful the iPod and then iPhone series were. Sure, trendy laptops and desktop computers contribute to Apple’s business but it has been the success of the iPod and then iPhone that really turned the company into the first to reach a $1 trillion valuation. Both pieces of technology transformed how consumers viewed first mobile music consumption and then mobile pretty-much-every-other-kind-of-digitalised-content consumption.
As a company, Apple is still growing as a result of its success in pushing the boundaries of what we can expect from a smartphone in terms of functionality, usability and design. And what we are willing to pay for it. The last iteration of the iPhone, the X, starts at £1000 and the new model expected to be unveiled next month is expected to be incrementally higher in cost.
Despite the huge success of the iPhone, the first model was released in late June back in 2007, it is also the last time that Apple has revolutionised the latest technology in the world. It is fair to say the Apple Watch smartwatch range, while not a complete failure, has not genuinely taken off as what was hoped to be, if not the successor to the smartphone, a must-have augmentation to the experience. Apple is acutely aware that at some point within the next few years, the company needs a new hit product.
Augmented reality appears to be the main focus – an open industry ‘secret’ further underlined by yesterday’s news. The Google Glass may have been a commercial failure a couple of years ago but Apple are clearly of the opinion that their competitor’s product was either too early, not good enough, or both. The Financial Times reports that Apple has had a team working on the latest technology in the world of ‘smart glasses’ for two years now. The recent spate of acquisitions is viewed as filling in the holes in the company’s tech stack as it works towards its next blockbuster product.
AR technology is encroaching more into the mainstream, popularised by the hit game Pokemon Go and the more technologically simple overlays of Snapchat. AR is also making its way onto the iPhone via apps and features like the ‘animoji’, which morphs users into animated characters. However, these early AR features are considered no more than testing grounds for less frivolous applications. Apple CEO Tim Cook said during a February call with analysts that he believes AR tech could eventually be as big as smartphones are today.
Akonia describes itself as “the world leader in systems and materials for holography”. The company owns over 200 patents with those for lightweight, low cost lenses it has developed believed to be the main attraction for the acquisition. They would be expected to be integrated in a future ‘i/Apple Glass’ headset or smart glasses set.
The greatest hardware challenge that companies seeking to develop commercially successful AR and VR technology have faced has been building wearables that consumers are comfortable with and want to put on. While no AR product is thought to be anywhere near close to market, the latest deal is a further indicator of what is going on in the background.