Why AI and Mixed Reality Are Being Adopted Differently

Apple and OpenAI are two very different companies when it comes to product launches.

• Apple recently showcased an expensive new mixed reality device, the VisionPro, with a strong marketing push at a global event, but Apple is keeping the product under wraps until 2024. Meanwhile, Apple is making developer kits available to create apps for the device.
• OpenAI dropped a fremium product, ChatGPT, with immediate availability and practically zero marketing.

OpenAI is doing what Steve Jobs wanted Apple to do for decades: change the world, possibly even more than Apple has done this century. But even though Apple moves at a different pace and with a different strategy, the company is still exerting a strong influence over an ecosystem of industries. Apple did something else that was easy to overlook: the company did not mention the supporting technologies behind VisionPro, notably AI. But OpenAI has banked its future on AI.

At first it might seem like OpenAI has placed the right bet by developing a software that requires no hardware purchase and taps into an established need. But AI is more than OpenAI. The AI space is rapidly evolving, and many players will come and go. In fact, more large language models are hitting the market, challenging ChatGPT, which could be a sign that the barrier to entry is even lower than expected. As impactful as OpenAI is, ChatGPT’s usage has dropped – which illustrates the reality that being in the AI space is not a golden ticket to success. Apple, meanwhile, is building off a well established leadership in the hardware space. Businesses operating in the orbit of OpenAI and Apple will need to be flexible and adapt to how both these companies introduce technology, and they’ll also need to tread carefully as the AI space rapidly evolves very imperfectly, with its own pitfalls alongside its benefits.

VisionPro, ChatGPT, Adoption Cost, and Content

The launch of VisionPro and ChatGPT underline the importance of adoption cost. ChatGPT became the fastest-growing app in history because it has practically zero adoption cost. VisionPro has obvious adoption cost, which will limit its applicability once the device becomes available to the general public in 2024.

VisionPro will cost $3,500. It’s also, well, a big device that drew some laughs from tech watchers like Scott Galloway because of its nerdy appearance. And an unfortunate choice of marketing on Apple’s part – a video of a dad wearing the headset while he watches his family and records them – made the VisionPro look creepy and alienating, as if to separate the dad from his family. (The video begged the question of how a family might react to each other wearing a mask, especially families with special needs children.) Adopting the device will require people to wear something that might be unappealing. On the other hand, ChatGPT is free in its basic form (a subscription is required to use the more advanced version). It’s easy to use, too. You don’t need a headset.

The cost of the VisionPro and the unappealing experience of wearing a headset will limit the product’s adoption in consumer settings. Instead, the VisionPro will more likely give Apple a more immediate entrée as a mixed reality provider in industries such as retail, entertainment, healthcare, manufacturing, and education -- where mixed reality has the potential to do everything from helping physicians learn how to perform complex surgeries to demonstrate products for retailers. However, Apple is entering a space crowded with established entrants, notably Meta and Microsoft.

As for ChatGPT – well, it’s impossible to keep up with how quickly ChatGPT is ushering in widespread change. OpenAI has arguably:

• Changed everyone’s vocabulary (how many people in the world knew that the term generative AI meant until OpenAI came along?).
• Disrupted the way we work.
• Upended Big Tech companies such as Google.
• Rekindled a longstanding conversation about the ethics of AI.

I doubt the EU and United States would be so rapidly moving to regulate AI had ChatGPT not been launched. Compare the speed with which regulators are moving now to their slow reactions to the rise of social media years ago. What would have happened had ChatGPT been released with an expensive price tag and required users to wear a headset? Would regulators have moved as quickly to address the rapid rise of AI?

Adoption cost does not explain everything. There is also the matter of content. Right now, VisionPro lacks content except for some pre-loaded Apple apps. This is why Apple has not made VisionPro available yet. The company is opening up VisonPro for third-party developers to create applications that will presumably make the product more interesting and useful. This is how Apple operates. With both the iPhone and Apple Watch, Apple opened up the products for third-party development early on. That approach was crucial. Third-party developers created the content that turned the iPhone into an indispensable tool and the Apple Watch into a popular fitness device. With VisionPro, Apple has created practically a blank canvas. It remains to be seen how many tech firms will want to play there.

We don’t know yet whether OpenAI has created an indispensable tool with ChatGPT or a niche product. This statement might sound surprising, but as noted above, ChatGPT has competition. And ChatGPT is running into some serious issues with security and copyright. You can be sure competitors are watching closely and playing to ChatGPT’s weaknesses. Moreover, OpenAI’s relationship with Microsoft is a two-edged sword. On the one hand, OpenAI gets a large financial stake from Microsoft. But aligning with Microsoft means aligning with Bing, whose market share lags far behind Google’s. And recently OpenAI withdrew ChatGPT’s “Browse with Bing” feature amid copyright and privacy concerns.

Apple is playing a long game here. But the question remains: will the cost of adoption limit the applicability of the VisionPro? A different but related question applies to ChatGPT: will the entrance of competitors limit its appeal to a smaller audience down the road?

Two Strategies

There are, of course, some major caveats and implications of the approaches that both companies are taking. OpenAI made available a product that was technically unfinished. It didn’t take long before ChatGPT’s myriad flaws became apparent, including inaccuracies, bias, and security lapses. In fact, Samsung banned its employees from using ChatGPT over privacy and security issues – not a good look for ChatGPT. Apple is taking a slower, more deliberate approach that has served the company well by building trust. Its products are far from perfect, but they’re trusted.

Both products will do the same thing, though: disrupt. ChatGPT already is. Look at how quickly Google needed to respond to ChatGPT by rushing to market its own AI-driven search products, Bard and Generative Search Experience. And now Amazon is adopting AI to deliver product summaries. Amazon, Google, and Microsoft are playing catch-up. OpenAI gets credit for forcing these rapid developments as part of the so-called generative AI arms race.

What about Apple, though? Well, any business operating in Apple’s orbit will need to be prepared to adapt at some point. The iPhone arguably upended industries such as transportation by making it possible for on-demand companies such as Uber to flourish. The Apple Watch challenged personal fitness brands such as Fitbit. Businesses operating in the ecosystem of OpenAI and Apple have something in common: they need to be adaptable to the power of disruption – one at a faster pace (OpenAI) and another at a more deliberate pace (Apple). But make no mistake: only the adaptable will survive. Contact Centific to learn how to adapt to emerging technology and thrive.