Microsoft unplugs AltspaceVR and lays off HoloLens team

As part of its layoff plan announced last week, Microsoft is significantly reducing the size of its virtual and augmented reality activities. Among the services affected is the social platform AltspaceVR, which will close its doors on March 10, 2023. Microsoft had acquired it for a pittance six years earlier but had not done much with it since. The company says it wants to focus on Mesh, a collaborative solution whose main interest is its planned integration with Teams.

End clap for HoloLens?

Another team affected: that in charge of HoloLens, the augmented reality headset that caused a sensation when it was presented in January 2015. Despite a promising start and marked enthusiasm when its successor was announced in 2019, the efforts of Microsoft faltered along the way, and key team members gradually jumped ship. The departure of Alex Kipman on the background of sexual harassment in June 2022 sounded like a death knell for an already very weakened project.

Microsoft had then abandoned a HoloLens 3 project in favor of a partnership with Samsung, in turn abandoned since because Samsung would prefer to try the adventure alone. Final blow: the refusal by the American government to order more helmets within the framework of its military program IVAS.

The contract with the badly engaged army

Bloomberg revealed on January 12 that the device would have too many problems to be usable in the field, and settled for allocating $40 million to the company to develop an improved version. The army had asked for 400 million dollars to buy 6,900 aircraft. The contract provides in theory an amount of 21.9 billion to acquire 121,000 helmets. A goal that seems less and less realistic given the setbacks encountered by the company.

The future of Microsoft in mixed reality is a priori rather on the application side, especially in collaboration solutions for companies. Its partnership with Meta could be central to these next developments, and a possible merger with the Xbox division on the gaming market cannot be ruled out in the medium term either.

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