Is Microsoft moving from an XR hardware provider to a software provider?

Microsoft is at the forefront of the immersive technology race. Along with Lenovo, Apple, Pico, Meta, and XREAL, Microsoft has become a leading player in the market.

However, the company’s approach has changed significantly since its XR inception. While Microsoft is still committed to the Hololens 2 product, its focus has recently shifted toward producing immersive solutions for third-party headsets.

Microsoft is particularly open to the flexibility and accessibility of XR applications, as seen with the new OpenXR encoding feature in Windows Holographic version 1.1. In the same vein as the development of open XR applications, Microsoft is also expanding access to its workplace-ready products, such as Mesh, Office and Dynamics 635, to a range of XR devices.

What’s more, Microsoft is doubling down on delivering hardware-agnostic XR productivity apps. The company is clearly looking to solidify its position at the forefront of the XR productivity craze, which Apple fueled earlier this year.

Microsoft Power Apps Launches on Realwear Devices

Microsoft’s latest move to expand the distribution of its immersive workplace software to a broader range of users follows an update to its long-standing partnership with RealWear to distribute Power Apps to Realwear smart glasses designed for firstline workers.

Realwear device operators can now access Power Apps through the RealWear Marketplace. RealWear Product Director Rama Oruganti he said:

We are excited to expand our partnership with Microsoft, leveraging Microsoft Power Apps to create innovative and efficient solutions for Firstline Workers. Integrating our hands-free, voice-controlled, industrial-grade Smart Glasses with Microsoft’s Power Platform increases the productivity and safety of our users.

Oruganti also explained that the launch of Power Apps “enables real-time data uploads and downloads from the Microsoft Dataverse, further enhancing operational efficiency.”

Power Apps offers enterprise customers a low-code app development suite that enables companies to design custom solutions with enhanced associativeness and mobility. Oruganti added, “This partnership reflects our commitment to developing technology that supports the evolving needs of frontline professionals.”

By running on Realwear devices, workers will be able to navigate Power Apps using the integrated voice controller on that device, providing a touchless workflow for on-site procedures.

Improved Microsoft Mesh to support Mac computers

Before Microsoft launched its proven Real Wear enterprise product, the company also expanded the availability of its Mesh immersive meetings platform on Apple Mac hardware.

Microsoft announced last month at AWE 2024 that the new and improved Mesh platform would debut for Mac users. Starting in late June, Mac users will be able to access new Mesh features that enable virtual meetings on the company’s leading Teams platform.

The announcement comes alongside a set of avatar integrations and usability improvements for Microsoft’s recently launched Microsoft Mesh platform, aimed at optimizing the creation of avatar content for enterprise use on the Teams remote communications platform.

The new features build on Microsoft’s ongoing development of its immersive avatar system, which first launched in public preview in October 2021. Microsoft officially launched Mesh in January with the goal of providing a more engaging experience for teams working remotely or in a hybrid environment.

Microsoft lays off HoloLens workers as part of Meta partnership

Microsoft’s current focus on delivering XR software solutions rather than hardware solutions follows the company’s actions earlier this year, which resulted in the layoff of about 1,000 employees across its HoloLens and Azure Cloud businesses.

The layoffs have hit Microsoft’s HoloLens 2 hardware and Azure’s “Moonshot” projects, which include collaborations with companies like SpaceX to streamline highly complex operations.

Microsoft spokesman Craig Cincotta recorded:

We will continue to sell HoloLens 2 while supporting existing HoloLens 2 customers and partners. – Organizational and staffing adjustments are a necessary and regular part of managing our business. We will continue to prioritize and invest in strategic growth areas for our future and to support our customers and partners.

The life of this device is not over yet, as partnerships like the IVAS deal with Microsoft are fueling its future.

However, the layoffs came in the midst of a deep partnership with Meta. Notably, the partnership is once again providing innovative XR production tools instead of hardware solutions, this time to create an alternative to Vision Pro.

During the Microsoft Build 2024 conference Pavan Davuluri, Vice President, Windows and Devices Enterprise, Microsoftannounced a new partnership with Meta to bring a volumetric workspace to the Quest portfolio. The move directly positions the Quest as a competitor to Apple’s Vision Pro productivity target.

Microsoft’s AI updates accompany the expansion of its volume workspace, with the company emphasizing how AI is enabling it to expand its product portfolio to include Quest hardware and other emerging endpoints. Additionally, deep cloud integration allows Microsoft to continue supporting a variety of endpoints, allowing users to access 365 services on “any device, anywhere,” as noted in an official blog post.

Microsoft is clearly investing in deepening its enterprise XR solutions. While its involvement in HoloLens may hinge on large-scale investments like its partnership with the US Army, Microsoft appears to be moving toward becoming a software vendor rather than a hardware provider.