Microsoft's HoloLens 3 's--t show' proves it still doesn't understand the consumer market

Man wearing HoloLens 2
Man wearing HoloLens 2 (Image credit: Windows Central)

Update 11 AM ET 2/4/2022: Microsoft's Alex Kipman has since posted a response claiming HoloLens 3 is not dead but did not address any of the other claims from the BI article.

Update 11 PM ET 2/4/2022: Business Insider has a new report that refutes Kipman, says HoloLens 3 is dead.

An explosive new report from Business Insider confirms everyone's worst fear regarding HoloLens and Mixed Reality: Microsoft has no idea what it's doing.

The story, which relied on reports from "more than 20 current and former employees," is a damming expose on the HoloLens division, headed by Microsoft technical fellow Alex Kipman. The entire program is apparently in complete disarray.

The news is devastating for those who thought that with HoloLens, announced in 2015, Microsoft would have an enormous advantage in the market because it was so early and ahead of everyone else.

In case you missed it, here is a tl;dr of Ashley Stewart's excellent reporting:

  • HoloLens 3 was reportedly canceled in mid-2021.
  • That timing was around when Microsoft partnered with Samsung for a mixed reality device.
  • The choice to rely on Samsung for hardware while Microsoft focuses on software is causing disruption.
  • The mixed reality and HoloLens teams are infighting over strategy: consumers vs. enterprise (and military).
  • The leadership team has largely failed to address the concerns of employees working on these projects.
  • The $22 billion Integrated Visual Augmentation System (IVAS) for the US military is having major quality issues and is behind schedule.
  • At least 25 Microsoft mixed reality employees left Microsoft and joined Facebook's Meta in 2021, but it may be more than 100 employees.

It's no wonder why one Microsoft employee called it a "s--t show." I have never heard of such a division in this much chaos in all my years of covering Microsoft.

History repeats itself

Microsoft Kinect

Source: Windows Central (Image credit: Source: Windows Central)

What's so troubling about all this negative news regarding Windows Mixed Reality is how familiar it all is to those who follow Microsoft. The company has a terrible track record of shipping consumer devices and creating new categories. There's Windows Phone, of course, but also Zune, the Courier Project, Surface Neo, Windows 10X, Project Andromeda, Kinect, Band, Kin, the entire Nokia acquisition, and some would lump in Surface Duo.

Even Windows Mixed Reality (WMR) has been in doubt despite being years ahead of anyone else, shipping free with all Windows 10 PCs, and having strong OEM support (HP, Lenovo, Acer, Samsung, and Dell all had WMR headsets).

Source: Microsoft (Image credit: Source: Microsoft)

On the contrary, Microsoft's Xbox division, save for a few shaky years, has been nailing it, which explains why it is pivoting (and investing) so heavily into it. And Surface, for the most part, has had strong (and innovative) releases that have seen many iterations.

But when it comes to cutting-edge, generation-defying products, Microsoft is very good at envisioning them but rarely sticks the landing. And the cause of the failure? It's rarely due to the product being awful. Instead, it's almost always attributable to lousy leadership, tumultuous strategy, lack of direction, and an inability to understand the market. I mean, we are talking about the same company that released its Kin phones at the same time it was selling Windows Mobile.

Interestingly, some in Microsoft's mixed reality division seem to know this past. The Samsung deal, which we speculated on the podcast, would have Microsoft do the software while Samsung did the hardware. It makes sense, as Samsung can not only ship things on a global level, but it also makes processors, RAM, storage, displays, and headphones all internally. Samsung does hardware very well. (Since this editorial went live, a new report sheds more light on the Samsung deal).

But, ironically, this decision to partner with Samsung is itself causing infighting within the mixed reality division. As reported by Business Insider:

It was even suggested by some that Microsoft should end the Samsung partnership, or do the bare minimum to fulfill it, in order to focus on its own projects, the employee said.

Microsoft even hired Apple's vice president of engineering, who helped spearhead the iPad and iPhone. He wanted to get to the market ahead of Apple with a mixed reality headset for consumers. Of course, which is it? Is Microsoft doing its own consumer mixed reality headset, or is it Samsung? No one seems to know.

The metaverse is still a joke

Ignite 2021 Mesh Demo 26.00 02 47 37.still

Source: Microsoft (Image credit: Source: Microsoft)

All these issues circle back to the main problem, which is that virtual reality (VR), mixed reality (MR), and augmented reality (AR) are still all cool ideas with little utility for regular people. That may change, but no one has been able to crack that nut so far. VR is still primarily for gamers with social sprinkled in, but it has a long way to go before being mainstream (if ever).

The recent trend of using "metaverse" as a buzzword for this technology is tragically hilarious. No one knows what it means. When examples are given, it refers to virtual reality … with avatars and a marketplace. Yeah, it's Second Life (2003), reborn but now with NFTs, virtual real estate, crypto, and idiotic venture capitalists. We get it. It's not cool.

Microsoft is caught up in this hype, too, even using the phrase when it talked about its recent announcement around the Activision Blizzard acquisition.

But if you have no idea what the metaverse is, neither does Microsoft. Even the teams working on it don't know what it is supposed to be and how to address it. The question is, will Apple? The company is rumored to release something in late 2022. If I were a betting man, I'd bet Cupertino is going to swoop in and dominate this market, followed by Google (who has its own rocky past in this segment). Microsoft mixed reality could be Windows Mobile all over again.

Time will tell what will become of Microsoft's mixed reality ambitions. Unless it gets back on track soon, trades in leadership, and brings on a visionary who can execute, this could all go down in another all-too-long list of Microsoft's "we were so far ahead we blew it" catastrophes.

Daniel Rubino

Daniel Rubino is the Editor-in-chief of Windows Central, head reviewer, podcast co-host, and analyst. He has been covering Microsoft since 2007 when this site was called WMExperts (and later Windows Phone Central). His interests include Windows, laptops, next-gen computing, and for some reason, watches. Before all this tech stuff, he worked on a Ph.D. in linguistics, watched people sleep (for medical purposes!), and ran the projectors at movie theaters because it was fun.

  • Sad and intriguing article. Thanks... I keep hoping MS can learn from these, but it's a like a movie ghost, forced to keep repeating its history over and over, never able to learn and grow like the living. (Limited metaphor, not suggesting MS is dead.)
  • It seems the leadership is not knowing what to do. Even with Satya things changed but still the same.
  • "Even with Satya things changed" To the worse...
  • Satya is the problem
  • That's MS insider team issue. Satya handled MSFT very well.
  • Satya handled the stuff in which he exceled well. He moved the cloud and subscription-based (which has a similar pricing model to cloud) stuff forward exceptionally. However, the consumer stuff is a collective letdown, IMO. We keep praising Xbox for their dev teams, but they're all taking FOREVER to release games. they're delayed, buggy, or both. Nadella ran mobile into the ground so fast it looked intentional. I still believe that's what made Band and Cortana (including connected devices like the Invoke speaker) an inevitable failure, as they were so reliant on mobile as a driving force to accompany them into consumers' lives. Surface, calling it a success is probably an "investor vs. consumer" thing. It's not losing money, so it's successful as a business. As a brand, I think it's completely lost itself from where it started. There's little innovation, while prices are through the roof. The latest Surface Pro starts at $1,100, while asking you to pay more than ever for the keyboards and pens to boot. Duo suffers greatly because of its MSRP and lack of sales (despite having a higher MSRP, the Fold 3 is constantly having good trade deals and sales). Consumer electronics just aren't a great experience within Microsoft. The did well with Surface, but have since branched out to releasing overpriced, mediocre stuff like their audio accessories and the Surface Laptop (which is a Macbook without the allure of Mc OS to justify its price tag).
  • Satya has, so far, managed quite well some/few of the programs that had been envioned and therefore developed by his predecessor.
  • He's been all along. Look at what he destroyed since he's CEO...
  • Well Satya is making rhe company earn a shitload of money. To investors is all that matters. Otherwise, anticipating the future tech will not always be easy.
  • I second that
  • That'd be nice if I was interested in Ms stock. In that case I'd be commenting on an investment site
  • Anticipating or not, doesn't matter, if satya cant put together what exists and make use out of it, like Windows on ARM, PWA support on edge, amazons android app support, CShell UI. satya is lacking everything that Microsoft needs to stay ahead of the times, and is simply keeping the shareholders distracted with what they get now by organizing, cutting losses and reducing risk factors, if so in the end, Microsoft future will be quite bleak, cause they will just "go lazy".
  • It's the same old goat...
  • After my experience with Microsoft as a developer for Windows 10/11, nothing in this article surprises me. It is, indeed, sad. You can only get them to pay attention if you start off with, "Azure . . ." I made a cool drawing program that was pen-centric and had voice commands in it, showing off Windows 10 when it arrived. I had a developer relations contact, but that led nowhere. Now he won't even return my emails.
    As background, I was a key developer/publisher for the Macintosh in the 80s, helping it get started. In the 90s, I co-founded the company that created what became Adobe Flash. And with this background, I couldn't get the time of day from Microsoft. Maybe I should have said, "I have a drawing program for Azure . . ."
    -Charlie Jackson
  • Maybe Microsoft's unofficial tagline should be: If it's not our idea, implemented in our way, we're not interested.
  • Their market research says X but nobody can find anyone who wants X. I think their market research is completely fabricated to support their preconceived notions.
  • I believe you have a point. Microsoft don't seem to be open to new ideas and especially if it may benefit the consumer a huge market which I don't understand their negative stance. The OS don't really put any new features and it seems if they find out you like something it's will be stripped in the following OS...
  • It's a bit sad they repeat this same mistake. Its hard not to draw comparisons to Apple. Both companies have an extraordinary amount of money and Microsoft seems to fall short in 2 key areas. They quit or lose faith too easily and they seem to try and do more with less too often. They don't sink too much money into areas they worry might fail. Which is why most of their most revenue stems from products they developed 2 decades or more ago. Office windows azure. All are very old. It's rare they develop anything new that sets the world on fire and unfortunate because they could really do so well. I wish they'd believe in what they do
  • I would add the rare exception seems to be Xbox/gaming now
  • I would say Xbox / gaming can be the exception because that's the one of the few products can't sell to enterprise.
  • I would say that rare exception was Ballmer but he was hated and now is long gone. Bill Gates hardly swallowed even the project concept of Xbox while Ballmer had no problem investing billions when it was loosing money and some costly mistakes needed that budget to be fixed.
  • They could have easily practice the same patience in developing the Xbox with Windows Mobile and WP they could have come along together. But I am wondering if Microsoft is prohibited from entering the mobile market because they act like they want any part of it...
  • They are not engaging pornography enough. It's what will make VR hot. You would think with bing being the porno search engine they'd do better with VR.
  • Hahaha while true I don't think THAT is what they want to be known for, even if it's what can drive interest
  • Well they could substitute that for sports from baseball, football, hockey, etc., to Indianapolis 500. Could partner with Disney and Xbox affiliates for content creation, movie theatres, schools, etc. but this would benefit consumers something Microsoft's upper management don't want to take part.
  • The comments about a consumer device possibly coming out was from Alex Kipman back in 2019... and he said it would take 4 years to possibly get it to that point. So we would of had to wait until 2023 to see another device come out anyways. Additionally the Hololens 3 program which was "scrapped" happened the same time MSFT started to redesign the waveguides according to this Army IVAS update which happened on December 1, 2021. The Army rep basically said the IVAS was a consumer Hololens 3 if you removed all the miltech sensors (digital night vision and thermal sensors). The video can be seen here:
  • I don't get the consumer angle. They could have developed this mostly for business and military. Just assumed that was their direction
  • A bit hilarious to read that all these 25 or maybe 100 Hololens folks were jumping ship from Microsoft to Meta. Seems like from frying pan to fire if you ask me. Although learning that, some of the stuff one sees in the public domain starts to make a little sense. If Zuckerberg is busy raiding engineers from a particular area wholesale from rivals, it would make sense for him to do something nutty like change his whole company name, to show these workers that cash aside, hey, we are really serious about this area in a way that is impossible at Microsoft or whichever other large company that has many other things to deal with. Also, this would explain why FB's stock tanked today. The earnings report showed Facebook is spending $3billion a year now on "Metaverse" (which as the writer reminds us, nobody knows what it means). I guess investors prefer real reality cash to virtual tokens. It also explains why Microsoft itself (or indeed any other company in the business) is happy to join the keyword hype and bandwagon. "We have our own "Metaverses" " etc. If you see your workers leaving wholesale through the backdoor to join "the Metaverse company" when the journalist on Bloomberg asks you what you are doing about the Metaverse, and you are Nadella, you can't really say, "I don't have time for that nonsense .." , since you don't want to encourage a stampede. :-) All that said, the reason Microsoft will lose on consumer anything is right there. FB is spending $3 Billion (not total, per year). It is always this way. The rival, more consumer-focused company is ready to spend humongous amounts near the beginning when the payoff isn't really clear. Microsoft is an old world company in a way non of their current rivals (except Apple) isn't because they stick to conservative investment approaches. They can never win in today's consumer business that way. Since Google came on the scene, the way that game is played as changed. Apple is different because they have a huge, high-income audience locked in their walled garden.
  • “Apple is different because they have a huge, high-income audience locked in their walled garden.” And Microsoft has a huge, high-income audience locked into their enterprise walled garden. The point is, Apple is a consumer company. Microsoft is an enterprise company. Neither understands - nor needs to understand - the other market. Both are hugely successful in their respective markets. And there is zero chance either would be successful in the other market.
  • I agree that Microsoft is somewhat comparable to Apple consumer in their enterprise dominance. I am not sure about the middle and end there though. Both Microsoft & Apple started out as just computer companies and sold to both audiences. It is only later they both got pushed out of those two different markets, not totally by design but just based on reality of focusing on what you do best when push came to shove. However, there is never a complete demarcation in the way you seem to think about it because computing devices and services are many times dual use, and the same individual who is a consumer consumer :-) is also an enterprise consumer. Indeed, and necessarily, both Microsoft and Apple still have considerable businesses that serve the "not focus" areas today. I am typing this on a Windows personal device. Finally, to these companies it's about making money, and/or fending off the competitor. They cannot afford to just leave the field of one segment completely because if they do, (a) they will miss learnings and trends that are useful in their main areas, and perhaps more importantly (b) very bad things can happen when competitors completely occupy other segments, and you have no recourse to competitive actions they can and will take against you in your area of strength, because they would like to make more money. So that "zero chance of success in the other market" thing, no company acts that way. I mean, there was a time neither Apple nor Google, had any presence in phones, Microsoft was the leader in phone software. So, a company can and will be evicted from their "area of strength" or dominant market or whatever if they misstep.
  • Except that all businesses use iPhones (or at least not Microsoft phones). So it is not that simple.
  • All businesses use iPhones? Where did you pull that out from? Most businesses that I know support BYOD when it comes to mobile devices.
  • Well it depends, I've been to companies that only provide company iPhones, though still offered BYOD, most just prefer having seperate working phone from their personal one. My current one uses Galaxy A21, it used to offer iPhones. Idk the statistics, but iPhone on enterprises is actually far more common that what most think. It's only Macs are rare, except on design and media related companies.
  • Exactly - back in 2015 Apple claimed their enterprise business was already $25 billion a year.
  • “The company has a terrible track record of shipping consumer devices and creating new categories.” So then, given this fact, WHY do people continue to look to MS for consumer products? Why are you ALWAYS surprised when yet another consumer product fails? Is anyone surprised that the Duo 1 sold barely 40,000 units in over 1 year? Of COURSE Microsoft “still doesn’t understand the consumer market”. Is it not totally, blindingly, bleeding obvious that MS is not, never has been and never will be, a consumer-focused company? MS is in the best financial shape in its 46 year history, without a single consumer product. Why do you continue to believe they need to be selling consumer products? Why not complain that Apple needs to get into the enterprise market with Linux/Oracle DB servers? What would be the point? Apple is a consumer company, and Apple is in THEIR best financial shape in THEIR 46 year history without a single enterprise product. Once you understand and accept all of this, life is good. It all makes sense.
  • "So then, given this fact, WHY do people continue to look to MS for consumer products?"
    You're conflating people's wants with the reality within Microsoft, who is, reportedly, having the same debate. The whole thrust of the BI article is the MS mixed reality division is in chaos, with no clear path forward, internal fighting focusing only on enterprise (and military) and what to do about the consumer market. Kipman wants a consumer product. The Samsung partnership is about a consumer product. The ex VP from Apple came to Microsoft to help launch a consumer product. Hell, forget the consumer angle for one second: MS is evidently blowing the $22B military deal with poor quality and being behind schedule. The (presumably) enterprise-grate HoloLens 3 was canceled.
    "Once you understand and accept all of this, life is good. It all makes sense."
    I'd suggest actually addressing the central thesis of the BI article first because none of this "makes sense." Consumer or enterprise, the whole thing is a disaster.
  • Then why is the title of this article “ Microsoft's HoloLens 3 's--t show' proves it still doesn't understand the consumer market”? My point stands. If people at MS are STILL expecting to build/sell a consumer product, then they are at the wrong company. Which explains why everyone is leaving for Facebook, which IS a consumer company. Do you get it yet? MS IS NOT A CONSUMER PRODUCTS COMPANY. Apparently people IN Microsoft are learning this obvious fact. That MS was trying to convert a consumer product into a military - of all things - product, just shows how clueless MS is outside of enterprise. Yes, it all makes sense. But you have to be willing to see AND ACCEPT reality.
  • My bigger concern is what's laid out here in the article: Mismanagement of the mixed reality division with no clear path forward for consumer or enterprise.
    I'm not on board with this statement. It's not that black and white when they sell Surface devices and Xboxes. The could do Surface HoloLens if they wanted, and being so ahead in the market (or, were) have an advantage. The head of HoloLens believes this as does Nadella, who financed the division.
  • Is microsoft going to mess this up and let Facebook take over?
  • Interesting thesis about Microsoft. But the Windows operating system isn't an enterprise product.
  • My Xbox Series X would like a word with you.
  • 6+ years and.... Nothing. What are they afraid of? Apple released the iphone with what, 12 apps in the app store? It wasn't anywhere near finished. Microsoft could have followed the same script. Let the masses decide where Hololens can go. It's like Microsoft is too protective and afraid of losing "their" idea.
  • When Apple first released the iPhone it didn't even have an app store. Which process your point even more.
  • Heck, it didn't have copy, paste either. However, Microsoft did try a similar process with Wp7. That failed due to stubborness and piss poor management.
  • Yep, the problem with WP7 is they basically just following similar approach like how iOS started, except its got a Windows Marketplace from the start, but iOS that time already have huge selection apps to begin with. And other features like task switcher and cut-copy-paste features were already implemented while WP7 has none at the start. That task switcher on Windows phone didn't even came until WP8. It was also mismanaged sadly and early bad decisions led to its very slow adoption rate to the point Android and iOS were too dominate on the market that is hard to crack. Not to mention the price entry for Windows Phone and its availability is hard. Even for those who may want it is either unable to afford or justify the price and is pretty rare to find.
  • Those bad decisions lasted through to WM10. On Wp7.x, Microsoft stubbornly region gated the best features of bing to the US. It had terrible landscape support. Not to mention the fiasco with msd cards. As well as the issue with the front buttons. Wp8 Microsoft still stubbornly refused to budge from adding a file explorer, notification centre, region gated Cortana. Email attachments defaulted to the photohub. Wp8.1, there's also the fiasco of tap to pay, dynamic lock screens. The Cortana team being under resourced. WM10, before launch the entire mobile division was axed. As a result the 950 series launched in a buggy mess with flagship prices. WM10 until cancellation still lacked basic features i.e being able to set custom/static ips per wifi network connection. Not to mention Microsoft pay never made it out of the US. That's just a few examples. On a wider note, there's WoA and lack investment into UWA. Especially, visible investment into UWA. Microsoft was too visibly invested into their competitors platforms. What materialised from that? Google kicking Microsoft in the teeth with the youtube app. Apple refusing to allow xcloud on their platform. Microsoft should have focused on WoA and UWA. As they could have used WoA on Hololens as well as pocketable devices. But nooo... it was too bleeding obvious *smh*.
  • Yeah, I still remember some of those shortcomings though are not the sole reason for its adoption issues, but still to sum up can be a bug factor for some. It seems that Microsoft were too slow to add features and trying to follow Apple approach even though they are late on the party. It took for W10M to address most of the shortcomings and it as become more of a proper "pocket" Windows, but it's too late, and that time of release it was so buggy, sluggish and UI were unpolished that was a turn off when release with a flagship device. That time I wasn't even the fan of Lumia 950 series, basically loosing the Fabula hardware design with something more bland. The last nicer looking Lumias were 930 and 830, IMO peaked the Lumia design. Don't get me wrong, I was really more into Windows Phone, but I can't deny it's shortcomings that disappointly took them a while to implement features it needs. Not to mention many API restrictions that don't help the app gap during WP7 and WP8.X days.
  • Lol. We can agree no surprise there. The only surprise is that you mention Windows 10X, as if that was a thing. And neglect to mention xbox's twin Windows Media Center.
  • How was 10X not a thing? It was announced by Microsoft. They published documentation on it for developers. There was a damn emulator released.
  • It was code name for a device that was never released.
  • No, it wasn't. Windows 10X is an operating system that other OEMs were going to use in future 2-in-1 PCs. It was announced. Documentation was released for developers, and there is a working emulator. If you're going to comment, at least make sure you know what you are talking about.
  • And Windows Media Center was in no way xbox's twin. It was an overlay/app on Win XP that brought entertainment options, to what was primarily a productivity device. No games BTW. It was Plex before Plex. One stop shop for Music, Videos, DVDs, TV, Radio, scheduling, recording.
  • Yeah, and I think it was just discontinued due to slowly loosing ground on HTPC market, and Xbox console were already serving as de facto media center. Maybe if they held it for longer, they could have a foundation of what a modern day Smart TV OS now. But Media Center is long gone before the rise of Smart TV.
  • WMC is not smart TV.
  • Media Center a productivity oriented device? It was aimed to entertainment for a consumer audience.
  • Windows Vista, Xbox and Windows Media Player were designed to be separate platforms going forward. So yeah it was a twin or a trio if you include vista. The products with round logos at the time represented platforms or ecosystem.
  • The X in 10x was a placeholder for an edition of Windows 10.
  • Device = Neo
    Software = Win 10X Not the same.
  • Or system software or software that operates hardware. It was 1 unreleased device.
  • Windows Media Center is ko twin of Xbox though. Especially in its early stage, Xbox were just for games and didn't really have media features. Only on Xbox 360 slowly that console becoming like Media Center, they even had baked it to Xbox until new Metro dashboard. HTPC market were waning that time, and mostly just a enthusiast HTPC who do it. Though it it lived longer, Windows Media Center could have played the way to Smart TV. But that time it was supposed to be Xbox One is the Media Center, which pretty much got what Media Center had including DVR and TV Guide.
  • Microsoft should bet it's whole Hololens business for Samsung partnership. Samsung will jump ship as soon as Google launches their new MR OS.
    Google will give them all privilege Samsung want with their Open Source model, something Microsoft can't provide with it's Closed Source proprietary OS. They should keep developing their own device and partner with OEM's who have less demands.
  • "Microsoft should bet it's whole Hololens business for Samsung partnership."
    Not sure that was ever claimed or implied. Samsung and Microsoft work often together on PC (see foldable PC initiative). Samsung stands to benefit from this as it could use the tech with its laptops and Galaxy phones.
  • At the moment, it seems that all the technology giants are still unsure about the prospects of mixed reality in the consumer. I can understand why consumer-oriented HoloLens is so difficult to produce, as it's still hard to imagine how the average person will use them in real everyday life.
  • I think it's always been the case with new form factor. Smartphone in its early days were also harder to imagine what regular consumers need for it and how they can use it. Mostly feature phones were already sufficient for most people needs. For mix reality, I think the hardware are just still early in this stage be really viable for consumers. Once we got to the point that it's more like wearing a sunglasses and with wider FoV that extends towards peripheral vision and decent battery that last a day, then only mix reality devices would be attractive, thus more devs will make apps for it. The problem at the moment is that smartphone devices are so versatile these days that there is very little thing left for mix reality devices to have unique features that smartphones cant do or not efficient on doing. Most people use smartphone for social media and media consumption, which is far more than sufficient with smartphones.
  • To have such a big headstart in the market, only to lose it due to poor management and lack of direction, is ridiculous. Personally, I think Satya Nadella has done well. Under Ballmer's leadership, Microsoft had really veered off course. They were chasing dead ends and it started to feel like they were going to slide into obscurity. Nadella was the right man to steady the business down and get them focussed. He followed safe bets into the cloud, and they've paid off. With that said, however, it does at times feel like Nadella is so laser focussed on cloud and office, and now xbox, that everything else Microsoft has to offer is of little to no interest. He's a steady pair of hands at the tiller, guiding Microsoft toward where the obvious money lies, but he's no visionary. He lacks depth of perspective. And, with the exception of xbox, he's completely at a loss in the consumer space.
  • I bought a Windows Mixed Reality headset and it just sits in a box. The weird progress - the lack of consistent development... and then the Oculus Go (then the Quest and Quest 2) came out and WMR just faded away. With HoloLens, the demos convinced me I wanted one - but then US$3000 with no warranty or return policy meant I waited until I could try it on and... well... underwhelming. So I passed on that. And I could see 3D on Windows was going away when 3D Builder, one of the best light weight 3D object design tools I've seen suddenly stopped being included and had to be downloaded from the MS Store, so none of this is surprising... just really... sad. One note though, Courier (a project near and dear to my heart) was never a public project. It was basically a leak by Gizmodo (I think). And it did sort of survive as Win 10X which admittedly is either in a coma or is dead (although Win 11 may be its eventual expression) and arguably, the Duo represents what's left of the idea,.
  • They have got to get rid of Satya Nadella before he blows this huge chance they have
  • Yeah, I don't think they are going to oust the CEO that turned the business into a multi trillion dollar company. The fact of the matter is that Microsoft aren't really making their money from consumer products, so why focus on it? Which I then understand why the staff might be getting frustrated, as they can see that these ventures simply aren't money makers, so what's the point?
  • I think a pandemic was the biggest cause of them becoming a multi trillion dollar company. Everyone bailing on the hospitality industry had to put their money somewhere. All the big tech players became trillion dollar companies having not released anything new and groundbreaking.
    If the board at Microsoft is basing their decisions just on stock price, they're missing the bigger picture.
  • It was not Satya that turned the business in to a. Ulti trillion $ company; he was a lucky guy who was able to capitalize, decently managing, some of the projects created by the predecessor. It not only MS shares that are going up, it is the sector.
  • I think Microsoft should go back to their roots; Project Fortaleza. It was originally intended to be an Xbox companion device to augment games. That always made sense to me. I understand wanting to kick their ambition to the moon and make it a platform unto itself like the PC, but if they aren't willing to commit to that why not go to Gaming? Gaming is driving VR, so why not AR? Revisit a PC replacement when technology allows it to be small and light enough while also being powerful enough.
  • Finally a headline with the word "shitshow". Now I can stop refraining myself from using the term 😊
  • How could you have avoided it the last couple of years?
  • "The recent trend of using "metaverse" as a buzzword for this technology is tragically hilarious. No one knows what it means. When examples are given, it refers to virtual reality … with avatars and a marketplace. Yeah, it's Second Life (2003), reborn but now with NFTs, virtual real estate, crypto, and idiotic venture capitalists. We get it. It's not cool." THANK YOU! Finally an article that describes everything I feel about "Metaverse".
  • Interesting how people were making similar comments about " A computer in every home" mantra...
  • Everyone is criticizing microsoft here but I think samsung making the hardware is a good move if the hardware is released as microsoft surface product. I am not sure whether this will happen or not. Microsoft needs a strong base. Both samsung and microsoft make foldable device but because samsung has huge experience creating consumer product and experiences their foldable phones are selling well. Also I think microsoft needs to restructure their hololens team and invest into their own products.
  • I am not surprised. With chip shortage still going on, there is no space for HoloLense. I expect competition to lose on all devices sold similar to Lumia industry. All gain will be on linked services that Microsoft failed to realise in mobile space already.
  • I think the underlying problem is that AR and VR is trash... I'm being a little hyperbolic, I know. Still, I think there's a simpler reason why this tech hasn't reached mass adoption and that's because the masses don't want it. Yes, VR is a metric ton better than it was in the 80s. And technically the cheapest it's ever been. Yet, the gilded age of VR continues to elude us. It's like when digital assistants were the hot, new thing. And everyone from Amazon to Apple was trying to convince you that their assistant would change your life... Here we are, years later, and the basic functions of these assistants have barely changed; turn off the lights, play some music, and what's the weather. The Metaverse is the same as 3DTVs. It's corporate backed propaganda to convince you there's a problem and they have a solution. You're right, Zuckerberg, my boss wearing a Mii outfit during a Zoom call made hearing how I'm being downsized so much more enjoyable. It's no wonder Hololens can't break into the consumer market. Smartphones make life better. Clunky headsets don't. And until a company creates a headset that can be easily inserted into everyday life, then AR/VR will continue to be a distant dream for corporations looking for mass adoption.
  • If they want their AR to be successful then they have to be big in the consumer Market.
    They've already decided they're going for it in 2024 so they need to get their act together.
  • So sad to see yet another case of Microsoft leading but then failing. Innovative engineers not lead by quality or visionary marketing and management. This is a malady invading many companies these days where only safe choices are permitted to “protect” the company. Result? Stifling of innovation. They’re really just waiting for a small innovative risk taking company to come up with something they can then buy and kill too. Another malady. It’s not just Microsoft. But some companies are better at the buyouts.
  • I think you're right. They've lost the vision that big bets can have massive upside. They've become afraid of losing everything when that likely isn't possible for one product to doom the whole company.
    I believe you should always be working to make yourself obsolete before another company does it for you.
  • MS is popular to introduce and pull out their technology and service. They've plenty of interesting and useful ideas/prototypes.
  • Sounds to me like Alex Kipman may need to not manage people, but work on tech and inspire others.
  • That's the feeling I'm getting to. It's not even a slight, not everyone is good at management, which is its own set of skills. Sometimes you need someone who is good at herding the cats, and someone who can just work on the vision and tech.
  • Why don't they use that guy they got from Apple to manage the team while he works on the tech
  • Just look how MS wasted Ray Ozzie...
  • One thing Microsoft does almost without fail is to approach the consumer business just as they do enterprise. While in enterprise roadmaps and long term strategy matter more than fast iteration, this doesn't work in the consumer business.
    They have great ideas, usually way ahead of the competition, but it takes them far too long to refine and perfect it in time to actually lead the market, so they either give up or half bake it to rush to the next new thing.
    They need to shed their enterprise mindset when it comes to consumers.
    The surface team sort of got it, but even there is room for improvement.
  • The consumer product (if there is one) and enterprise/military products should be completely separated, maybe all three should be completely separated. They need to focus to get anywhere and clearly that isn't happening when they have all this mashed together. They might share technology and learnings at some points along the way but having interdependencies will result in ... Exactly what they've got ... chaos.
  • "The consumer product (if there is one) and enterprise/military products should be completely separated, maybe all three should be completely separated."
    I agree.
  • Baffles me why that isn't the case at MSFT.
    Yes, technologically they're all intertwined, but those segments have such different individually unique needs, separating them is the only thing that makes any sense.
    I used to work at a Fortune 50 tech company.
    Technology was shared a across all business units, but product, planning, operations, marketing, service were all separate units for each BU.
    I really don't know how it could possibly work any different.
  • AR/VR is still waiting for it’s killer App. Many suppose it to be gaming, social or maybe identifying people in your address book when you meet. Maybe it’s navigation or education? That process of discovery is being done in the market place with disappointing results by Google, Microsoft and Facebook right now. The result, consumer confusion and disappointment.
    I don’t think a Samsung/Microsoft partnership is a good idea. It’s tough enough to make things happen when everyone is on the same team but two companies, hardware/software focused, will likely end up with some sort of dogcow hybrid system.
  • The killer app for VR is porn. However, none of the mainstream companies are willing to admit it and work on it. It would have to be a small start up that does it. Care to invest in my (probably if I get off my lazy ass) future venture?
  • Can't have a killer app until the get the input method correct. Until then, apps won't make much sense.
  • This is when I miss Balmer. He persevered when Xbox was a lost cause, and today it's the only non-core business Microsoft succeeded in. A few more years of Ballmer and Windows 10 Mobile would have become a viable third mobile OS. Microsoft has become victim to "investor focused" innovation rather than consumer focused innovation, which brought down companies like HP.
  • Agree completely. Very true
  • "A few more years of Ballmer and Windows 10 Mobile would have become a viable third mobile OS."
    By his own admission, Ballmer flubbed Windows Phone due to the burning fire that was Windows Vista (and then 8):
    “If there’s one thing I guess you would say I regret, I regret that there was a period in the early 2000s when we were so focused on what we had to do around Windows that we weren’t able to redeploy talent to the new device called the phone. That is the thing I regret the most. The time we missed is the time we were working on what became [Windows] Vista and I wish we had resources slightly differently [deployed]. It would have been better for Windows.” - Steve Ballmer
    He is also the one the pushed the Nokia deal, which while it made sense at the time, IMO, was eventually executed poorly. By the time Ballmer left in 2015, Windows Phone was already on a steady decline after it peaked in 2013. What history tells us is that Windows Phone (nee Windows Mobile) needed the push early in the market to dominate. Playing catch up while rebooting the OS three times and charging an OEM license fee (when Android was "free"), was always a losing strategy. This is the exact problem that should be avoided with mixed reality but instead seems to be repeating.
  • Mixed reality is still in the early days. They are like pre-2007 smartphones. Until a breakthrough makes them a joy to use, they will continue to be low impact.
  • Charging license fee was pure greed. They were making money off of every Android device sold. They could have used that money to ensure they built a robust mobile system. But much of Microsoft history is to do things half heartedly. And they seldom stick to anything. Create and Cancel should be their motto at times.
  • Maybe it's time for Dan and Zac to take over management at Microsoft.
  • I doubt they want that headache as lucrative it may be lol.
  • I've always wondered where Microsoft would be if Elop and taken over as CEO. I believe they still would have been successful in the way Microsoft is now, and successful the consumer market as well. I don't believe in one instant Nadella cares for any of these types of projects. None! I think he goes along for appeasement. Or maybe a built-in tax write-off. Is rain wet? Is the sun hot? Does Microsoft suck at consumer products? Yes, for all of the above. Years ago, when Microsoft started hiring people from google and apple I knew there was going to be a problem. Let's bring people in who don't share our vision. There's a reason I didn't want an apple or google product. Again, I've said it now for almost a decade, Microsoft is not trying to lead. They are trying to coast. They want to follow and act like they're in with the cool kids (Apple/Google). They really have not shown any leadership in the past 12 years in the consumer space. Capitulating time after time after time with lazy decisions like they can't stick to something and see it through. This is why I can never be mad at those who say, Microsoft won't follow through with DUO. Their history speaks for itself. They a plain quitters.
  • Elop is no longer CEO of anything. It doesn't seem the market agrees with your assessment as he has never attained the heights as CEO of Nokia since his departure.
  • Really, I didn't know that? Ha! How does that take away from the notion or belief, if he were at the helm that Microsoft would still be successful both in consumer products and their other business areas? It doesn't. He may have failed miserably. But looking at Microsoft consumer brand under Nadella's leadership isn't a shining star. And at least I don't have to wonder about that.
  • Elop is still considered by many to have failed Nokia. After all, the mobile division is basically no more. It's gone and now just a shell company (Nokia HMD) that makes 'meh' Android phones. I think Microsoft's decision to have a CEO who knows Microsoft and is from within its ranks is better than bringing in one who capsized a business, IMO. Nadella was already a success story within Microsoft before his ascent to CEO.
    "But looking at Microsoft consumer brand under Nadella's leadership isn't a shining star."
    Microsoft rightly focuses on areas where it thinks it can win and turn into billion-dollar businesses. Under Ballmer, only Surface and Xbox survived his push into consumer tech.
  • Surface is Ballmer child. Elop came from Microsoft... (Office guy) Nadella is the retrenchment guy.
  • Nadella is the Azure guy, who has led Microsoft to more success than Ballmer. If Ballmer was really smart, he would have instructed the Surface division to build its own Windows Mobile phone back in 2012. If the model worked for PC, why would it not have worked for phones, which, arguably, needed it much more than PC?
  • "If Ballmer was really smart, he would have instructed the Surface division to build its own Windows Mobile phone back in 2012. If the model worked for PC, why would it not have worked for phones, which, arguably, needed it much more than PC?" Here's where we agree 100%!!! You get no argument here. So many lost opportunities.
  • No, Balmer and Ozzie started the project, Nadella did not.
  • Those things survived because someone in the company decided to continue them. And luckily, they survived. In the past years there were rumors and reporting that Nadella was going to pull the plug on Surface and possibly Xbox. So yes, Nadella wants to focus on areas where he believes they can win. Nothing wrong with that. I'm just saying I wish Microsoft had a leader that could focus on both business and consumer side.
  • *exasperated sigh*... hardly surprising at all....
  • No idea about consumers and it looks like they're also starting to screw up in the enterprise sector.
    Case in point, Neo.
    Yes, I'll mourn the death (almost certain at this point) for a long time, and there's a good reason.
    At work, I use a full blown laptop for my office (it's now a Laptop Studio). I, and many of my peers travel a lot, so when we saw the Neo announcement, we were thrilled. We NEED a device small enough to truly be mobile, always connected and (based on the tools we use) HAS to run full Windows. The Neo looked like the perfect device. I use the Duo at my trips for some basic work and it's way better than a slab phone at that, but for many tasks it's just a bit too small and lugging my laptop around is often impractical (try working in economy when the flight is full and you know what I mean). The Neo looked perfect.
    The plan was to have me test one and then deploy it to about 50 users, eventually to about 200 of us.
    We waited until 2 weeks ago.
    Now I'm testing the Surface Go 3 LTE and if it performs OK during my trips over the next 3 weeks we will go with that.
    But it cost us time where we were waiting for something that wasn't.
    It will also very likely be compromise.
    As soon as they realized that 10X wasn't happening, they should have worked on making Win 11 a reality on that form factor. No excuses. Full steam ahead.
    But they didn't.
    Their way of doing things simply kills any confidence anyone puts in them.
    And they keep doing it. Over and over.
    I don't know why their management is so messed up.
    But it can't stay that way.
  • I would be surprised if they aren't working on Windows 11 for such devices, but it is going to take time. They killed 10X less than a year ago and have been wasting their time making devices for Android.
  • My point is, it's too late.
    We had to move on. Many probably have. Nobody is willing to wait for two years without any word on what's going on for a device.
    We can safely assume that even if it ever launches (which I really doubt at this point) it will be a buggy mess at start, which will further show that they just can't get it right from the start, no matter how long it takes.
    That's just inexcusable.
  • You are probably right, but folks are launching folding Windows machines this year, but they don't have support from Windows yet. Luckily these are folding screens, so it doesn't take much. Microsoft should at least be able to get that right. If they can't, they should just give up software. They can just stick with Azure/Enterprise, Xbox, and being a Google OEM.
  • It is still too early for these AR/VR technologies. The input method for them has not been created yet. Until they figure out the input method, they will never catch on. The current devices can be fun for gaming, but they aren't great yet. They are frustrating to use for the most part and feel like a gimmick for anything else. When someone gets it right, it will be immediately obvious. That will also spark a software revolution to go with it. Software now is held back by the poor input methods.
  • Still looking for an improvement in input beyond flashing colours on devices. If Apple can solve some of the hardware/OS issues on a touchbar and nobody cares to adopt it, what are the chances something as huge as AR/VR will be a mass-market pickup.
  • Finally, a great piece by Rubino. Kudos! Took the words out of my mouth
  • Some 20-30 minutes before I launched this site and saw this article on my laptop, I was watching a music group's livestream on YouTube on my phone and had a thought about how the embodied vision of a company will determine its successful ventures, when I imagined how Google (through YouTube) had been able to capture and index (and influence) human expressions, interests and interaction to a very high degree through acquiring a video sharing platform. Their founding vision matched and turbo-charged this acquisition into the behemoth it is today. Seeing this article makes me think that Microsoft would have killed all the potential of YouTube if they'd bought it from its founders, because it does not fit in with their DNA. Other video-sharing sites would have taken over and there would have been a fragmented market. I think I agree with Daniel that Apple will make a big dent in this space. They already have the power-sipping silicon, hardware chops, experiences ecosystem, and consumer story to sell their solution to their fans and the market. Microsoft does not have any idea what to do with consumers or how to woo them long-term. Whenever any of their teams comes up with something, the corporate bent of Microsoft chokes it to death. Gaming is the outlier of course, with a built-in and super-engaged audience. Microsoft gave up on a Lumia fanbase it created from scratch because it didn't make short-term business sense. I don't have any hope for the Hololens in the consumer space.
  • I think this article is much ado about nothing and old news, but you have a very good point that Microsoft tends to butcher a lot of stuff they get their hands on that has potential. For instance, they claim they missed the social media boat, for instance, but that's a fib. They literally owned the first social media platform called FireFly, which was originally an MIT project called Agents Inc. Microsoft dismantled FireFly after buying it, integrated a small part of it into the Microsoft Passport and sold the rest of the assets to Yahoo. This was before not only Facebook but Myspace. They did the same thing with Pacific Microsonics, the state-of-the-art audio mastering hardware company and originator of the HDCD standard. After acquiring it they shut down the R&D and manufacturing facility, sold the remaining hardware assets (I believe to Euphonix), stopped the marketing and cataloguing of new HDCD album releases, and then just took the software compatibility stuff and put it in Windows Media Player, actually buried where most people don't even know it's present. Seems like they have too many corporate raider types historically at Microsoft that are running these M&As, even if they might be inspired by the nerds amongst them as to which companies to target. It'd be like Lisa from the Simpsons recommending to HQ as to the prospective companies and then HQ giving each of the projects over to Mr. Burns.
  • Get back into mobile. Go ahead an purchase LG's phone tech and build/launch windows phone. Your lacking ideas because you cut out a whole segment "Mobile" limiting what you can do. Mobile is simply to huge a segment/population. Those Windows Phones of which I had one and loved the Live Tiles and of course the opposition didn't but that made wp so special from the stagnant icons which we still have. Tools to convert Android and Apple code to Windows was not given the chance/time before some knuckle head shut the operation down...
  • Android and iOS have interactive Live Tiles (widgets). They were not a differentiator for WP, they were actually a hinderance. The total lack of interactivity made them just about useless.
  • how do you know this?
    How about I bit skeptical of this report.
  • You're living in denial then.
  • Most of this BI article's information dates from the end of 2021 or earlier. The only relatively new info is about Facebook and others poaching Microsoft employees with salaries never previously seen for these fields, but even that story was not initially revealed by BI and is not brand new.
  • Doesn't seem like new information, though. It's also odd that at the end of the article it asks for more Microsoft employees to contact them as sources, as if they don't have as many sources or the newest ones as they're claiming. We knew people were changing jobs with crazy offers from other companies. We also knew months ago that IVAS FOV was being changed, cyber security WIFI tests had been postponed, and with both COVID and the rushed Afghan withdrawal there wasn't much urgency, so the bigger combat simulation field tests and full production got moved to the next year. All old news, and "not there yet" doesn't come off as much more than taking old comments out of context. Last year Microsoft employees said Hololens 3 would be a more-mobile consumer version of Hololens 2. With the IVAS system so much more capable, that no longer makes sense. There's also no reason that those consumers or academics who want the current Hololens 2 can't just buy one already. Either Microsoft ought to wait until IVAS is finished or just do their own version of a Quest or Pimax using conventional VR technology if they want in on that bandwagon. I also have to agree with the idea that AR is more obviously an enterprise and military application, but VR spreads more easily into consumer spaces, too. If you're going to do VR for the consumer segment, again, just get together with Samsung and build a VR headset. As for people leaving or protesting over Hololens technology being used by the military, again, old news and I think those Washington State hippy peaceniks are out of touch with reality. Microsoft is probably better off without employees who can't understand the utility of technology that could improve effectiveness, shorten wars, and lower civilian casualties. They're probably the same crowd that wants to de-fund the police.
  • Microsoft don't have a clue what to do with consumer products, with the exception of gaming. It makes huge amounts of money in the enterprise. That's where it is at. Consumer is hard. You need to build attractive ecosystems or be really good at one thing, like Spotify. That isn't a bad thing commercially. Their VR/AR strategy, for what it is, isn't aligned to its business model.
  • How so? They're focusing on enterprise and the military for their current apparent AR strategy.
  • While many of the asssertions about Microsoft failing at most consumer ventures is true (Xbox being the clear exception) the very premise of this article / header is wrong. If there is a s—t show happening in MR it doesn’t mean Microsoft still doesn’t understand the consumer market. How can it be evidence of something it isn’t even targeting? HoloLens is an Enterprise product. Any “consumer” can buy it if they want to but it is an Enterprise device and solution. So any failure here in MR (a term that Microsoft created and validated) means it may be a failure to deliver Enterprise value, but is does NOT mean it is validation of not understanding the consumer market. If they do pivot and HL3 is consumer oriented, and they fail to execute there (liklely), then we can jump on the bandwagon. What MS has pulled off with HL, despite the naysayers, is HARD work. And no, I am not on the MR team but I do know how hard it is and there has been major progress, with some Enterprise challenges, but nothing that validated a lack of consumer challenges.
  • I work in a large university lab/workshop area and I think of multiple uses per week on where a set of AR glasses might come in handy, from pulling up a floating user manual for a piece of scientific equipment to glancing around the workshop to see which bits of machinery need servicing along with relevent data. IOT sensors within said machinery could produce diagnostic data on the fly letting you know of problems before they happen. What I want is the Focus from Horizon Zero Dawn! Walking the streets of my city I have approximately zero thoughts on where some AR glasses might be useful. Microsoft should have been all-in on industrial and military applications for the technology. Medicine, Engineering, Manufacture, Civil, Education, Aviation, Law Enforcement; all areas where this technology could flourish. If they had gone down this route instead of trying to find newer ways to waste time with it we might be on a smaller Hololens 4 by now.