A Hardware Look at Facebook’s Meta Announcement and Future

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By Eric Abbruzzese | 4Q 2021 | IN-6333

Facebook confirmed, as officially as it can, its focus on the metaverse with a top-level company rebrand to Meta à la Alphabet for Google.

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When in Doubt, Rebrand the Entire Company

NEWS


Facebook confirmed, as officially as it can, its focus on the metaverse with a top-level company rebrand to Meta à la Alphabet for Google. Meta is a more targeted rebranding than Alphabet, however; the ex-Facebook company has made it clear for months that the metaverse has been the end goal for the company. Having had gigantic and disparate brands underneath the Facebook brand—not only with the Facebook social platform but also with Instagram, WhatsApp, and Oculus, most notably—a top-level name change could be expected with or without the company’s insistence on a metaverse future. With a US$10 billion investment promise, 10,000 metaverse jobs in the European Union, and assurance that Meta will not be profitable—by design—for the foreseeable future, Meta creates a very interesting metaverse player over the next few years.

This insight will mostly look at the hardware ramifications alongside these changes; another insight examining the broader Meta platform and its market opportunities can be found here IN-6335. There are also a number of ABI Research insights from the past few months that discuss the platform’s underpinnings leading up to this official rebrand.

New Hardware in Both Product and Name

IMPACT


One major hardware announcement came out of the Meta rebrand—Project Cambria. Few details were shared, but it is slated to be a high-end Head-Mounted Display (HMD) sitting above the Oculus Quest 2 in price and capability that is planned for launch in 2022. Metaverse-friendly elements—including facial expression and eye contact sensors as well as mixed reality capabilities—are different on paper from the Quest 2. If more core components—such as resolution, frame rate, optics quality, controllers, and so on—are also an improvement, then Project Cambria will be well received in the current VR ecosystem rather than for an upcoming (and, for Meta, currently theoretical) metaverse market.

Project Nazaré—Meta’s AR glasses—are the other half of the Meta hardware story. These glasses have been confirmed to be in development in the past but have now received the project code name treatment. The example that Meta has given has shown WhatsApp integration and some casual gaming but not much else. No launch date has been mentioned, but a possible release date several years away has been cited. The Ray-Ban Stories smart glasses, released in September, are not true AR glasses as they lack a screen, but they do represent Meta’s first step into the AR HMD (sans display in this case) market. VR has always been separate both in usage and hardware from AR, so a non-VR product in any form is an interesting test bed for the company.

Use cases for new hardware remain a question as an all-encompassing metaverse that actually has value to potential users is a ways away. Gaming is the predominant market for VR, and that will continue whether the VR headsets are named Oculus or Meta. A more open approach to software and content access on the hardware side will accelerate already-strong adoption. For AR, it’s too early to say anything concrete around likely adoption or use. A smart watch alternative or replacement is most likely for any non-immersive (e.g., lightweight, daily wear) AR glasses, and Meta’s test run with Ray-Ban Stories along with an appropriate research and development phase for Nazaré is promising.

A Clear Direction with Unclear Steps

RECOMMENDATIONS


As much as Meta has been pushing the metaverse for the past few months, there were always valid questions around how open the company will be to partnership and third-party integration—something that is critical to the core theory of a metaverse. Of course, it is too early to see how Meta will actually shape up in this regard, but the changes do point to a more open and accessible hardware future. Removing the Facebook account requirement for Oculus devices is a telling first step.

Some of the rebrand seems unnecessary, especially around Oculus. Oculus is an established name in the VR space—Meta is not. In fact, one of the things that has been holding Oculus back was its connection—both literal and figurative—to Facebook. Having Meta run through hardware and a broader platform may lead customers to believe the two are more intertwined than they actually are. This of course changes over time; as the Meta platform grows, the individual hardware branding matters less.

At the same time, Meta being “metaverse first” bodes well for hardware divisions going forward. In theory, Meta can focus on hardware to prop up the metaverse platform rather than hardware to prop up the Facebook platform alone. This is a small but important distinction as the overlap between Facebook and VR is much more limited than the metaverse and VR. Facebook combined with VR is mostly a data play, and while data will still be a component of Meta (as it will be with all tech giants), the desire to improve Meta’s platform experience through hardware is more tangible than improving Facebook alone. Gaming, live events, and retail tie-ins are already commonplace in VR but are currently siloed. For events and retail especially, that siloed nature limits market exposure and is an entry barrier for users.

From a hardware perspective, being able to access content across hardware and applications will be a boon. Rather than an Oculus store for the Oculus Platform—separate from the Horizon social hub and Facebook—Meta content should be accessible across all Meta hardware. Crucially, if Meta wants to push a true metaverse, then Meta content will also be accessible on non-Meta hardware, and non-Meta content will be accessible on Meta hardware.

It’s a lofty goal for a company as ubiquitous and established as Facebook, but obviously Meta believes in this road map. As discussed in previous ABI analyses, Meta’s initial metaverse efforts will not likely resemble that gold standard—a totally universal platform. However, with a hardware ecosystem slowly moving away from a Facebook anchor and with a new product on the horizon, Meta is set up for success. Success is never guaranteed, but lacking any glaring omissions in technology or portfolio, Meta seems to be on its path.

 

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