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Oculus Quest 3 confirmed to be affordable, But Meta's VR business is on thin ice.

Coupled with its announcements that Facebook and Instagram would soon include AI regardless of your preferences, Meta's most recent investor call saw a tripling down on the affordability of the Oculus Quest 3 and disclosed that its VR business isn't performing that well. 

Now let us start with the good news: According to Meta CEO Mark Zuckerberg, this year's "next-gen VR headset" — most likely the Quest 3 — will be offered "at a price point that will be accessible for many people." 

This most likely suggests that it will be priced similarly to the Oculus Quest 2 when it launches. Just be careful not to get your hopes up that the Quest 3 will sell at the same £299, $299, or AU$479 as the Quest 2 did at launch, as those days of incredibly affordable Meta headsets are probably over. 

The key distinctions between the Quest and Quest Pro lines may be seen when speaking with Meta and listening to it speak to other outlets in interviews and at conferences. The ordinary Quest VR headsets will have good basic specifications at a more reasonable cost, while the Quest Pro models will cost more but have somewhat better specs and a tonne of extra features. 

It is already evident in the recently released headsets. The Quest 2 is a good VR headset, the Meta Quest Pro delivers slightly more Memory, a better chipset, and exclusive capabilities like full-color mixed reality, face tracking, and eye tracking. 

After making its debut on the Quest Pro, full-colour passthrough for mixed reality is already confirmed for the Quest 3, but only when the technology is more readily available. 

Non-recoverable losses? 

However, for the bad news, based on numbers provided in its investor call, Meta's VR company remains eminently unprofitable. Reality Labs, a part of Meta, reported sales of $339 million in the first quarter of 2023 but losses of over $4 billion. Moreover, its revenue is lower than it was during the same period in 2022, and its stated losses are worse as well (it only lost $2.9 billion in Q1 2022). 

Although the company's other endeavours are fortunately doing better, with its larger "Family of Apps" earning $11.2 billion in revenue, VR is still a significant drain on its finances. Extenuating conditions, such as the severance payments Reality Labs had to make to the staff members it lay off, are partially to blame for Reality Labs' poor Q1 2023 performance, according to Meta, while it also points the finger at low Quest 2 sales. 

If you are not a shareholder in Meta, these losses are currently not a big deal. Despite the unfavourable statistics, Meta continues to be openly excited about its intentions for the metaverse, but who knows how long this attitude will persist? 

AI has emerged as the next big thing, and in an effort to keep up, Meta might reallocate Reality Labs' resources. Meta may have claimed the Quest 3 would be affordable, but no such guarantees have yet been made for the Quest 4, Quest 5, or beyond - if they are made at all. In addition, Meta may decide its hardware needs to become more expensive to better match its enormous losses. 

Fans of Meta's VR initiatives should hope it starts producing money soon, but we'll have to wait and see what the company unveils in the upcoming months and years. Just so long can Reality Labs continue to lose money before Meta is forced to give up on its VR initiatives.