Microsoft has consistently demonstrated a commitment to pioneering innovative technologies, particularly in the realm of extended reality (XR). The introduction of the Windows Mixed Reality platform in 2017 marked a significant step forward, enabling various PC manufacturers to develop a diverse array of consumer-ready XR headsets. Prior to this, in 2016, Microsoft unveiled the HoloLens, a groundbreaking enterprise-grade mixed reality headset, which was soon succeeded by the HoloLens 2. While this device found favor among businesses, it struggled to capture the consumer market’s attention.
In recent years, however, Microsoft has seemingly retreated from the XR landscape, discontinuing the HoloLens and ceasing support for Windows Mixed Reality. This shift has led many to speculate whether Microsoft’s immersive ambitions have come to an end. Yet, a closer examination reveals that the company may still have a role to play in the XR arena.
Microsoft XR Software: The Death of Windows Mixed Reality
To understand Microsoft’s current position in XR software development, one must reflect on the launch of Windows Mixed Reality in 2017. The initiative aimed to capitalize on the burgeoning PC VR market, which was largely dominated by competitors such as Oculus and HTC. By collaborating with manufacturers like Acer, Dell, Lenovo, Samsung, and HP, Microsoft played a pivotal role in the emergence of affordable headsets. Up until the release of the HP Reverb G2 in 2020, Microsoft continued to make strides in this space.
Windows Mixed Reality headsets were among the pioneers in introducing inside-out tracking, a feature that has since become standard across most devices. However, the platform faced numerous challenges, including basic controller designs and a lack of incentives for VR developers to engage with it. Consequently, the Windows Mixed Reality app store remained sparse compared to the extensive libraries offered by Meta and Steam, leading to a significant decline in user adoption. In December 2023, Microsoft quietly announced the removal of WMR from Windows 11. While the HoloLens headsets remain unaffected, all previous devices utilizing WMR will essentially be rendered inoperable following the 2024 update. Users can opt not to update their headsets, but even then, they will only have access to SteamVR apps until November 2026, after which no security updates or technical support will be provided.
Software Partnerships: A New Era for Windows Mixed Reality
Despite the apparent demise of the Windows Mixed Reality platform, evidence suggests that Microsoft is pivoting towards becoming a software provider for other XR vendors. This shift is exemplified by partnerships with companies like Unity and a collaboration with Meta in 2023 to develop an “Xbox Cloud Gaming” system for Quest devices. At the Ignite conference in 2024, Microsoft introduced a mixed reality version of its Windows portfolio tailored for Meta Quest 3 and Quest 3S headsets.
While Quest 3 headsets will not run Windows natively, they will enable users to stream content directly from their PCs, allowing for seamless interaction with applications such as Microsoft Teams, Word, and Excel. This development could enhance the Quest 3’s appeal to enterprise users, ensuring Microsoft retains a significant presence in the XR software market.
Microsoft’s Continued Presence in the Software Market
Microsoft’s collaborations extend beyond Meta; the company has also formed a long-term partnership with RealWear to distribute Power Apps for the vendor’s smart glasses. During Ignite 2024, Microsoft announced that its Windows solution would initially roll out to Meta Quest 3 and Quest 3S headsets, indicating potential support for additional devices in the future.
Moreover, Microsoft continues to innovate in XR software, as evidenced by ongoing developments with Microsoft Mesh. Announced updates at the 2024 Ignite event suggest that Microsoft intends to maintain its involvement in the XR space from a software standpoint, despite stepping back from the Windows Mixed Reality platform.
Microsoft XR Hardware: The End of the HoloLens
While the fate of Microsoft’s XR software appears to be evolving, the future of its hardware is less certain. After a prolonged period of silence regarding the HoloLens, Microsoft has confirmed the discontinuation of these headsets. The first-generation HoloLens has received its final updates, while HoloLens 2 will continue to receive security updates and support until December 2027. However, major feature updates for the HoloLens 2 have ceased, with the most recent update introducing enhancements such as WinGet integration and improved cloud-sharing capabilities.
Moving forward, HoloLens technology will still be provided to the U.S. Army as part of the Integrated Visual Augmented System strategy, but no new HoloLens headsets are in development. This decision aligns with the HoloLens’ limited adoption compared to more accessible solutions like the Meta Quest, particularly in the consumer market. Despite their premium price tag, the HoloLens headsets found a niche among enterprise users in sectors like healthcare, manufacturing, and education, showcasing the potential of mixed reality technology.
Could the HoloLens 2 Still Make a Comeback?
For those hoping for a resurgence of the HoloLens 2, the outlook is bleak. It seems improbable that Microsoft will revive this headset in the foreseeable future. However, rumors suggest that a new type of mixed reality device may be on the horizon. Reports indicate that Microsoft has partnered with Samsung to produce mini OLED panels for a potential new line of MR headsets, with mass production expected to commence in 2026.
Speculation surrounds the possibility of Microsoft developing a competitor to the Apple Vision Pro, focusing on the enterprise market. This new device might feature a custom-built Windows Mixed Reality computing platform or a cloud streaming solution. While details remain scarce, Microsoft has filed patents for technology reminiscent of the Vision Pro’s outer display, though it remains to be seen whether the company will pursue such features.
From HoloLens to Windows Mixed Reality, and Beyond?
The future of Microsoft in the XR domain remains uncertain. While the company has experienced some success in this space, the discontinuation of the HoloLens and Windows Mixed Reality has left it navigating turbulent waters. It appears that Microsoft will continue to prioritize XR software development, with initiatives like Microsoft Mesh indicating a sustained interest in this area.
On the hardware front, the trajectory is less clear. The HoloLens 2 is unlikely to return, but there is potential for Microsoft to introduce a new line of XR headsets, likely targeting the enterprise market with premium offerings. However, if the rumors regarding the partnership with Samsung hold true, it may be some time before we see any new devices emerge. As Microsoft juggles various projects, the timeline for new developments in XR hardware remains ambiguous. The future may be unpredictable, but the industry will be watching closely for any emerging news or developments.
