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Apple’s long-awaited mixed reality headset is rumored to make its debut at the upcoming WWDC 2023 event, and speculations are already swirling about its hefty price tag. According to the latest reports, this cutting-edge device could set customers back around $3,000 due to its advanced technologies and complex manufacturing process. However, industry insiders suggest that Apple’s manufacturing cost for each unit may be significantly lower, estimated at $1,500.
Wellsenn XR, a reputable source in the XR industry, has released a report detailing the Bill of Materials (BoM) for Apple’s upcoming mixed reality headset. If the report holds true, the components required for the headset would cost Apple approximately $1,400.
When factoring in shipping costs, the total price for manufacturing each unit is projected to be $1,600. The headset is expected to feature Apple’s powerful M2 chip, along with 12GB of RAM, 512GB of SSD storage, and cutting-edge connectivity options such as Wi-Fi 6 and Bluetooth 5.3.
Among the components, OLED displays stand out as the most expensive, with an estimated cost ranging between $280 and $320 per unit. Additionally, the camera arrangement consisting of 14 lenses is also a significant contributor to the overall cost, totaling around $160.
Comparing Apple’s mixed reality headset to existing market options, industry expert Brad Lynch points out that Meta Quest Pro, for instance, boasts a manufacturing cost half that of Apple’s headset. Meta initially launched their headset at $1,500 but later slashed the price to $999. This suggests that Meta earns approximately $250 in profit per unit.
Unlike its competitors, Apple is known for maintaining a healthy profit margin. Although there were reports suggesting Apple may sell the headset at a loss to enhance its competitiveness, those plans were eventually abandoned, according to Bloomberg. Apple typically spends around $500 to manufacture an iPhone 14 Pro Max, which retails for $1,099, aligning with the rumored $3,000 price point for the headset.
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Insiders familiar with Apple’s operations claim the company has been investing over $1 billion annually in the development of its mixed reality headset. However, Apple has reportedly adjusted its sales expectations for the product, anticipating sales of no more than 500,000 units in the first year. This suggests that Apple aims to position its headset as a premium offering with advanced features, though the market’s response remains uncertain.
Ultimately, only time will reveal whether customers are willing to embrace this new product category at the anticipated price point. Apple’s foray into mixed reality presents an opportunity to introduce innovative technologies, but the success of the venture hinges on consumer adoption and the appeal of the device itself.