Apple Vision prone

Hullo, it’s Alex in London. The Apple headset looks like a form of insurance against Meta. But first…Three things you need to know today:• N [View in browser]( [Bloomberg]( Hullo, it’s Alex in London. The Apple headset looks like a form of insurance against Meta. But first… Three things you need to know today: • Netflix paid $5 billion for [WWE’s Raw]( • Verizon added an [influx of mobile customers]( • MrBeast posted his [first video on China’s Bilibili]( Let Tim Cook There’s something that’s often misunderstood about the Vision Pro, Apple Inc.’s mixed reality headset. Apple doesn’t really need the product to be a hit. Or let me rephrase: It doesn’t need the Vision Pro to be a hit as long as any rival product — in particular Meta’s Quest virtual-reality products – is also not a hit. Apple is currently [taking preorders]( for the $3,499 device ahead of a Feb. 2 rollout. Within hours, delivery dates had slipped back to mid-March. It’s an imperfect gauge of demand, of course, since we don’t know how many devices Apple has manufactured. It’s clearly not bad news for shareholders, though. The company could ship as many as 400,000 units this year, generating an estimated $1.4 billion in revenue, according to UBS. That’s a rounding error for Apple’s anticipated $397 billion in revenue this year. But that doesn’t matter. For Tim Cook, attack is the best form of defense. Because if smart eyewear in its various forms — augmented, virtual and mixed reality — were somehow to become the next prevalent form of personal computing, and Apple didn’t have a product in the space, then it would have a serious problem. If headsets don’t take off, then Apple still has a market-leading position in the current prevalent forms of computing: computers, tablets and especially smartphones. Last year, Apple sold 235 million iPhones, meaning [it leapfrogged]( Samsung Electronics Co. to become the world’s bestselling smartphone maker, according to the research firm IDC. That $200 billion-a-year smartphone business is still the flywheel powering everything else Apple does. Without the iPhone it wouldn’t have a $40 billion-a-year wearables, home and accessories business or an $85 billion-a-year services business. Its Mac and iPad businesses would probably be nowhere near their current size of a combined $58 billion. So that is why the Vision Pro matters to Apple. It’s a just-in-case product. One reason Meta Platforms Inc. Chief Executive Officer Mark Zuckerberg went all in on what he likes to call the metaverse is that Apple is the gatekeeper of his social media business. Most people access Facebook, Instagram and WhatsApp on their smartphones. When Apple makes it harder to serve personalized digital ads on its devices, that [hurts Zuckerberg’s business](, as it did in 2021 to the tune of $10 billion. The best way to evade the gatekeeper is to build your own castle and moat, which is what Meta is trying to do with its Quest headsets. So far those efforts have yielded limited success. In the 12 months through September, its Reality Labs division reported revenue of $2.3 billion, just 2% of the company’s total. It’s not a great return for the tens of billions of dollars that Meta has likely invested. And it suits Apple just fine. There are, however, two risks. First, Apple might end up [lifting the whole category]( in a way that does ultimately benefit Meta, whose devices sell for a fraction of the Vision Pro’s sticker price. And second, the investment for Apple could come at the expense of other new hardware categories that could ultimately usurp the smartphone. There’s a handful of startups that are pushing new [devices designed around artificial intelligence](, for instance, that are just slightly bigger than the old iPod nano: Rabbit and Humane. [In an interview]( with Bloomberg last week, OpenAI CEO Sam Altman seemed to acknowledge that his company is [working on something similar]( with the former Apple design chief Jony Ive. Altman also conceded that such a device may not be necessary because AI is ultimately just software. And if that means people mostly use AI assistants on their smartphones (and if — a big if — Apple can [get its act together with Siri]() then maybe the Cupertino, California, company wins again. —[Alex Webb](mailto:awebb25@bloomberg.net) The big story Apple delayed the rollout of its electric car to 2028. After a decade-long attempt to build a driverless car, the company is [shifting to a less ambitious design](: an EV with more limited autonomy features. One to watch [Watch the Bloomberg Technology TV analysis]( of Netflix’s $5 billion WWE deal. Get fully charged UK fintech firms will head to Saudi Arabia this month in efforts to [lure investors into startups](. Amazon was fined $34.9 million by a French watchdog for [monitoring employee activity](. DocuSign faces a buyout attempt, and the final bidders are the private equity firms [Bain Capital and Hellman & Friedman](. More from Bloomberg Get Bloomberg Tech weeklies in your inbox: - [Cyber Bulletin]( for coverage of the shadow world of hackers and cyber-espionage - [Game On]( for reporting on the video game business - [Power On]( for Apple scoops, consumer tech news and more - [Screentime]( for a front-row seat to the collision of Hollywood and Silicon Valley - [Soundbite]( for reporting on podcasting, the music industry and audio trends - [Q&AI]( for answers to all your questions about AI Follow Us Like getting this newsletter? 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