Apple Inc.’s consumer tech strategy has been close to flawless since it released the iPod in 2001. Or it was – until the Vision Pro. Representing the company’s first foray into augmented reality, the headset is an extraordinary technological achievement. It’s also heavy, has a short battery life and starts at $3,500. Unsurprisingly, sales have been scant, and Apple, after releasing a slightly upgraded model, is backing away from further updates.
Sounds like a flop, right? Well yes, but look past the immediate failure and the Vision Pro saga is a clear sign that Apple – which may have created more revolutionary consumer products than any other company in history – still understands how to make world-changing innovations.
The first thing to know about the Vision Pro is that it really is a technological marvel. When it was released in February 2024, PCMag described its combination of eye- and hand-tracking with high resolution screens as “a generational leap in mixed reality interface design.” And in the year and a half since, Apple has improved both the hardware and the software. Just as the original iPhone had a user experience fundamentally different from earlier smart phones, the Vision Pro seems more like something from a science fiction movie than anything on the market today.
The second thing to understand is that even though the Vision Pro is the product of billions of dollars of investment and years of R&D, it is far from Apple’s original vision of glasses you could wear all day. Rather, the Vision Pro is something you can use for a couple of hours at most, and it’s definitely not something you can go about your daily routine wearing. This isn’t just because of its limited battery life or weight; it also cuts you off from the outside world. And its use cases are very limited (its most obvious one is media consumption, and even then it lacks features like a Netflix Inc. app).
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Given both these limitations and its extraordinarily high price, the Vision Pro’s failure was both foreseeable and preordained. I love gadgets more than most people. (Irrationally so, according to my wife.) And I never even considered buying a Vision Pro. Judging by the market’s response, I’m hardly alone. In fact, a substantial number of those who bought the Vision Pro apparently ended up returning it because they just couldn’t get enough use out of the device to justify its price.
So why do I think Apple spending billions of dollars developing a product destined to be a commercial bomb is a good sign for the company’s future? Because of what it says about Apple’s continued willingness to challenge consensus and use its virtually infinite resources to push technology forward in the ways that are most likely to produce its next breakthrough product.
Think back to when the iPhone was first released. It had significant technological advantages over earlier smartphones, like its multitouch screen and software keyboard. Developing those technologies took at least $150 million in capital investment from Apple – a huge amount for the company at the time. Breakthroughs often require that sort of investment, even when it means betting the company, as The Boeing Company did with the 707.
Apple is now so profitable that it doesn’t need to risk its survival to make big bets. But even as it’s being harshly criticized for lagging in AI, it has made huge technology investments – it’s just made them differently than the rest of the industry. Spending on a sure failure might seem like a bad idea, but it’s easy to forget that while the worst ideas often seemclearly doomed from the start, so do the very best ones. Today the iPhone’s success seems inevitable. But when it was launched, many thought it would fail. Even Harvard Business School professor Clayton Christensen, the creator of the influential theory of disruptive innovation, was certain that it would.
Apple’s willingness to move on from the Vision Pro shows that it’s not tempted to fall in love with its own ideas. It advanced technology in ways that will surely be useful in future forays into augmented reality, learned that the market prioritizes affordability and ergonomics over technological wizardry and cut its losses before they could become more than a rounding error.
The biggest returns always come from going against the grain. Most such attempts will fail. But Apple operates at a scale few other companies could imagine. As marketer Michael Miraflor recently pointed out, its services business generates more revenue than Target Corp., the iPad does about as much as Advanced Micro Devices, Inc., and the iPhone more than Bank of America Corp. Risks like the Vision Pro are exactly the kind that Apple needs to take to move the needle, and there’s no better sign for its future than its continued willingness to take them now.More from Bloomberg Opinion:
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This column reflects the personal views of the author and does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Gautam Mukunda writes about corporate management and innovation. He teaches leadership at the Yale School of Management and is the author of “Indispensable: When Leaders Really Matter.”