The VR, AR, XR world began in the 1960’s with devices like Morton Heilig’s Telesphere Mask and Ivan Sutherland’s ‘Sword of Damocles’, surprisingly not that far off from VR headsets of only a few years ago.  Since then, the industry has changed radically and has become more concerned with toward creating products that are commercially oriented and serve a broad set of consumers, rather than the earlier focus of creating a new ‘reality’, one that had relatively limited appeal to the average consumer.  While the objective of creating a more realistic virtual environment remains intact, CE brands have begun to better understand the larger CE paradigm and have seemed to come to the following conclusion.
Wearing a large head-mounted display (HMD) is both cumbersome and limits where the user can access the device.  Rather than immersing the user in a completely virtual world, a larger user base of ‘casual’ users that focus more on convenience and ease-of-use is more likely to generate sustainable revenue.  Simply, a device that allows the user to see the both the real world and an adjunctive one together in a non-obtrusive package without Head-Mounted Display constraints, will appeal to a larger group of consumers.  
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The Niche vs. the Mass Market
While VR is still being developed and refined, the AR world blossomed in 2025 and began to develop into a broad product category while VR is a more niche CE product.  It appeals to gamers and has a number of practical applications in training and maintenance, while AR, even in its relatively simple current form, has a much wider  appeal.  The image of board meetings with gesticulating members wearing VR headsets is now replaced with members wearing smart glasses, able to see accurate facial expressions rather than cartoonish avatars, while viewing either a physical or digital whiteboard. 

​While there are a number of VR, AR, XR devices that have category overlap, the industry timeline has changed over the last year or so.  AI has accelerated that change, but we suspect that this movement toward a more commercially oriented VR, AR, XR product development path was inevitable even without AI    Ai serves as an additional enticement for consumers in addition to the platform’s appeal, and while  VR has always fought against the bulk, weight, and cost of HMD devices, AR smart glasses have made those factors almost immaterial, at least from the user’s perspective, and the ability to use such a device without the obvious constraints of an HMD, puts AR glasses in a new light.
There is a hitch however.  The development path of AR glasses has become more complex as we see two forward paths, and while some might see these two paths as price oriented, we see them as a defining characteristic, whether the device has an internal display or whether it does not. 
Smart glasses without an internal display can have a number of features, with each model and brand having a different combination and price range.  The low end of the range for smart glasses with no display, typically for branded glasses like the Amazon (AMZN) Echo Frames (Gen 3) run from under $200 to over $400 depending on the features and style. 
The Feature List for no-Display Smart Glasses

• Speakers – Typically speakers are built into the frames.  This allows the user to hear both the speakers and ambient sound.  Some smart glasses use external cancelling systems to keep others from hearing
• Microphones – Typically a number of mics that make isolating the users voice from wind and noise more easily accomplished.
• Proximity Detection – This allows media to automatically pause when the user takes off the glasses
• Pairing – This allows the user to remain connected with both a laptop and a smartphone at the same time
• POV Photography & Video – Hands-free photos and video capture (Remember this for later)
• Streaming – Direct streaming to social media platforms
• Privacy Indicator – An external LED that shows others when the camera is in use
• Voice Navigation – Real-time, turn-by-turn audio walking or driving directions
• Real-time Translation – Real-time audio foreign language translation
• Notification Reader – Audio summaries of texts, e-mails, alerts, without checking your phone
• AI – AI is available as an adjunct to a number of functions but the user can access the AI by voice at any time for queries or search.
• Prescription/ Photochromic Lenses – Most smart glasses can be fitted with prescription lenses by an optician.
• Gesture Control – Some smart glasses can be controlled with head gestures

Most important to note is that when the user accesses the camera for photos or video in non-display smart glasses, the only frame of reference the user has is what he/she is looking at, not what is being recorded.  The cameras tend to be mounted  very close to the user’s eye which helps, but without a display you either shoot blind or use your smartphone as a viewfinder to see the image you are shooting or recording.  Newer glasses have ultra-wide cameras, so the camera will capture anything in your optical FOV (Field of View), but again, no visual reference until you play the image or video back on your phone or PC, at which point it is usually too late to reshoot.  Some Android and Apple (AAPL) devices can be paired with a watch, which acts as a small viewfinder to help to center images, but without a display the user has little actual control over image positioning details.
The Display Category
Smart glasses with a display offer the ability to view data and images without the need to access your smartphone.   While VR blocks your view of the outside world, smart glasses allow the user to see the real world directly through the lenses.  Those with displays actually project the digital images onto or into the lens, combining it with the actual image the user sees. The OST (Optical See-Through) sub-category has a typically higher price point, accounting for the cost of the display/projector, waveguides, and associated optics, and typically costs between 2x and 3x the price of the non-display category but provides a much more robust platform.  Pricing ranges from ~$300 to $900, again depending on features and style, with 2026 models about to be announced at CES.
The primary advantage of the display-equipped category is the elimination of "digital guesswork."  In non-display models, a user receiving a notification hears a chime but cannot discern its urgency without a voice readout or checking a phone. In contrast, display-equipped glasses provide instant notification, a discreet text overlay that allows the user to read an incoming message in their peripheral vision while maintaining eye contact in a social or professional setting. This "glanceable" interface reduces the cognitive load of switching focus between a physical task and a handheld screen.
Further, the display transforms several key functions from abstract audio into concrete utility:

• Visual Viewfinder: As noted previously, non-display glasses require "shooting blind." A display provides a real-time viewfinder, allowing the user to frame photos, adjust zoom, and confirm that the camera is capturing the intended subject, essential for high-quality content creation or documentation.
• Contextual Navigation: Instead of listening for "turn right in 200 feet," OST glasses can project 3D directional arrows directly onto the pavement or street in the user’s line of sight. This "heads-up" navigation is significantly safer and more intuitive for cyclists, pedestrians, and drivers.
• Visual Translation (Subtitling): While audio translation is useful, it can be intrusive or easily drowned out by ambient noise. Display smart glasses offer real-time subtitling, projecting translated text below the speaker’s face. This allow for a natural conversational flow, as the user can read the translation without breaking eye contact or relying on an earpiece.
• Teleprompter & Productivity: For professionals, the display acts as a hands-free teleprompter for presentations or a "secondary monitor" for checking technical schematics and checklists. This is particularly transformative in industrial and medical fields, where "eyes-on-task" is a safety requirement.

Ultimately, while audio-only glasses provide an audio soundtrack to reality, display-equipped glasses provide a digital overlay that fundamentally changes how a user interacts with their environment, offering independence from the smartphone that audio-only devices cannot yet match.
Lifestyle Integration
As we look toward the 2026 product landscape, the choice between display-equipped and display-less smart glasses is no longer just about a budget.  It is about a philosophy of use. For the user seeking a “digital assistant in the ear” and a high-quality hands-free camera, the display-less category offers a frictionless, socially acceptable entry point that feels like regular eyewear. For those who require visual data, whether for navigation, real-time subtitles, or mobile productivity, the display category provides a more robust, albeit costlier, window into the future of computing. Regardless of the path chosen, the "Sword of Damocles" has finally been unsheathed. By prioritizing convenience over total immersion, the industry has successfully moved AR from a sci-fi curiosity to a cornerstone of the modern CE ecosystem.

In mid-September Meta (FB) announced the release of its first commercial Ray-Ban AR glasses that contained an integrated display.  The company has shown a number of prototypes of its more advanced ‘Orion’ AR glasses but continues to develop and refine those prototypes before releasing them to consumers.  Meta took a different path for the design of the Ray-Ban Display Smart Glasses, diverging from the typical  display and optical track that most AR developers pursue, for what we believe are two reasons, cost and practicality..
Cost and Practicality: Comparing Diffractive vs. Geometric Waveguides for Augmented Reality:
When evaluating smart glasses and augmented reality (AR) wearables for consumer, applications, the type of display and waveguide chosen directly influences cost, design flexibility, and practicality. While this might seem an overly technical focus from an investor standpoint, we believe Meta’s choices here reflect a conscious focus on avoiding the common mistake made by many CE firms, that of overengineering products to prove their expertise in a particular technology or design category.  Apple’s (AAPL) Vision Pro is the perfect example of such, offering exemplary hardware, but over-promising on software, all at a price that is far above what the average consumer might pay especially for the first iteration of a new product category.
Given that Meta’s general philosophy has been to dominate the AR/VR/XR category by providing consumer oriented devices at a reasonable price, we expect that idiom carried through to the RBD (Ray-Ban Display) project by focusing on creating a device that balances mature technology against practical technology.  Simply, Meta used a display technology (LCoS) that is mature and cost effective to offset the cost and complexity of a sophisticated waveguide system that avoids some of the issues that befall other AR devices. Here is that balance:
AR/VR/XR devices typically try to use the latest display technology to generate a high quality image that displays the most realistic image possible.  This is essential in VR and XR, where a totally immersive experience is the goal, but AR is a different animal and does not require the high resolution rates that VR does.  Meta chose a 600x600 LCoS (Liquid Crystal on Silicon)  as an illumination source.  LCoS has been available for many years and was the light source for the Google (GOOG) Glass series released in 2013, so it has become a mature and cost-effective near-eye display system.  LCoS is exceptionally small, a very necessary feature for AR glasses which must be light and unobtrusive.  LCoS is bright as it is driven by LEDs, necessary as AR images often compete with bright ambient daylight.  LCoS is inexpensive relative to most other near-eye display technologies. 
Cost Comparison of AR Display Systems
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LCoS is a sequential system.  Using three (Red, green, blue) LEDs, the system turns on the red LED and the liquid crystal acts as a gate (modulator) turning each pixel in the frame on or off depending on the image.  When each pixel in the frame is completed, the Red LED is turned off and the green LED is turned on.  In the same way, the liquid crystal turns each pixel in the frame on or off.  This is followed by the blue LED.  As this process happens very quickly (~3.7 milliseconds for each color), the user sees a blend of colors for each pixel, as shown below.    Note that the liquid crystal allows for a number of variations between on and off (between 256 and 1024 for each color) so the number of colors that LCoS can generate is similar to other display modalities, between 16.7 million and 1 billion.
The LCoS system is more complex than we illustrate here, but the image it generates must be directed to the viewer’s eye and that is another characteristic that sets the Meta Ray-Ban Display glasses apart from others.  Waveguides allow the image to move from the display or projector to the user’s eye through optical means, however the typical AR choice is a diffractive waveguide system, while the Ray-Ban Display Smart Glasses use a geometric waveguide.  Here are the details:
What Are AR Waveguides?
AR waveguides are specialized optical components that control how digital images are projected into the user’s eyes while maintaining see-through transparency. This approach allows users to interact with both the digital and physical worlds, forming the backbone of leading AR and XR glasses. Waveguide technology directly affects field of view (FoV), image brightness, weight, and overall device comfort, all of which are key features that drive consumer adoption and competitive advantage in the smart glasses space.
Diffractive Waveguides: Cost-Effective for Mass Market
Diffractive waveguides utilize holographic gratings or nano-imprinted patterns etched onto glass or polymer substrates. These patterns bend light to precise angles, creating a virtual display effect with minimal material. Thanks to scalable lithography and nano-imprint processes, diffractive waveguides now offer some of the lowest per-unit costs in the AR optics field once initial R&D and master tool investments are amortized. High-volume manufacturing enables AR brands to deliver lightweight, thin-profile glasses at prices suitable for mass-market consumers and logistics workers.
However, the practicality of diffractive waveguides is tempered by technical challenges. As diffractive structures lose a significant percentage of light, manufacturers must use extremely bright micro displays, commonly MicroLED or LCOS. While affordable, these displays can drive up device power requirements and impact battery life, and  diffractive waveguides are known to produce color dispersion artifacts, sometimes termed the “rainbow effect” adding to technical challenges that can distract consumers.  Most diffractive waveguide-based AR glasses today achieve a field of view between 40°–50°, which is enough for notifications, light navigation, and basic media playback but may fall short for immersive enterprise or gaming scenarios.
Geometric Waveguides: High-Quality but Costly
Geometric waveguides use carefully crafted multi-layered glass structures with partial and total internal reflection to inject and guide images from micro displays directly to the wearer’s eyes. This approach minimizes light loss, creating higher brightness, sharper color reproduction, and a larger field of view, often 60°–70° or greater, which is ideal for immersive training, mixed reality, medical overlays, and advanced consumer entertainment.
The practical downside of geometric waveguides stems from their manufacturing complexity. Precision glass bonding and multi-layer assembly require advanced facilities, and have higher raw material costs, along with some significant yield challenges. Defect rates are higher, especially as manufacturers push for ultra-wide FoV (Field of View) designs. As a result, geometric waveguides often cost 30–50% more per unit than diffractive counterparts and are most common in premium AR headsets, industrial applications, and military devices where fidelity cannot be compromised. The slightly thicker profile can be less comfortable for all-day consumer use, but users benefit from lower power requirements and longer battery life thanks to higher optical efficiency.
Meta Ray-Ban Display Smart Glasses – Decisions
The two choices that Meta made concerning the  display and the optics for the Ray-Ban Display smart glasses indicate a deep understanding of the current AR customer base and the potential future for AR.  There seems to be little or no thought of ignoring costs and using both the highest cost and quality display with the highest cost and quality optics.  Rather, a balance between quality and practical need seem to have guided the multitude of decisions needed to create a successful consumer device:

 Conclusion: Why are Meta’s Ray-Ban Display Smart Glasses Different?
The Meta Ray-Ban Display glasses represent a decisive and commercially strategic divergence from the common paradigm driving AR/XR competitors like the Apple Vision Pro. They are fundamentally different because they prioritize practicality, style, and mass-market readiness over pure technological prowess.
The Meta Difference is a Calculated Trade-off:

• Strategic Trade-Off (LCoS & Geometric Waveguide): Instead of pursuing the cutting-edge (and expensive) Micro-OLED/Micro-LED displays, paired with complex Diffractive Waveguides, Meta intentionally selected a more balanced, mature stack. By using the cost-effective and power-efficient LCoS display with a high-fidelity Geometric Waveguide, Meta achieves bright, full-color visuals necessary for AR notifications without the high cost, bulk, and power drain of other systems. This choice directly translates to an accessible price point for a first-generation product.
• Focus on Form Factor (Style over Specs): The Meta Ray-Ban Display is, first and foremost, a fashionable accessory. The partnership with Luxottica and the use of the Geometric Waveguide (which enables a thinner, more familiar lens profile than other AR optics) ensure the glasses resemble classic Ray-Bans. This design decision—prioritizing all-day comfort, style, and social acceptability—is the greatest barrier to adoption that Meta is actively trying to break.
• The New Input Paradigm (Meta Neural Band): While other smart glasses rely on voice or clumsy touch controls, the integration of the optional Meta Neural Band (EMG wristband) offers a novel, discreet, and hands-free control layer. This quiet interaction method is critical for public use, making the experience private and seamless—a necessary step for making smart glasses truly practical in social environments. We will evaluate the Neural Band at a later date.

In summary, the Meta Ray-Ban Display is not trying to be a "full AR" computer like the future "Orion" or the current Vision Pro. It is a mass-market, AI-powered overlay device—a calculated "Phase 1" designed to establish the core form factor, build user confidence, and integrate Meta AI into the consumer's daily life at a price point that avoids the "over-engineering mistake" of its competitors.
Note:  We have no connection with Meta or any CE company we mention.  We have no investments in any CE company and make no equity investments, other than ETFs.  We receive no compensation for mentioning companies in our notes and provide not investment banking  advice or receive participation compensation
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Yesterday Samsung Electronics (005930.KS) released its long-awaited Galaxy XR headset.  Aside from the hardware and software features, the key point of focus for this device is the cost, which at $1,800 is half that of Apple’s (AAPL) Vision Pro and a bit above Meta’s (FB) Quest Pro, which was released at $1.500 (Now available for $999) and the Meta Quest 3s, a lower priced version released as an alternative to the Meta Quest Pro in 2024.  As the Samsung device has just been announced and will not be delivered until October 31 at the earliest, we have limited our comparison to hardware and software, leaving user input for a later comparison.
We compare these  four XR devices to help investors and users understand the feature/cost ratio, essentially what you get for your money and how the feature set compares with others.

A note on controllers… Price tiers help to determine how these devices arecontrolled.  Less expensive headsets, such as the Meta 3s, are driven by hand-held controllers (Meta’s are called ‘Touch Plus’) that contain gyros, accelerometers, triggers, buttons, and haptic feedback.  Aside from the sensors in the controllers, the headset’s hand tracking cameras continually map the free space location of the controllers to the headset image giving what is called 6 degrees of freedom (6DoF).  As this was the traditional way to control VR headsets it remains available in most cases, but the trend is toward eye tracking and gesture based systems, along with voice commands.  The Meta headsets we show both use handheld controllers that are included with the initial purchase and the Samsung Galaxy XR offers them as an optional ad-on.  The Vision Pro does not offer controllers.  As the move away from hand-held controllers continues, the importance of the resolution of the hand tracking cameras becomes more important to register fine movements.
While hardware tends to be the topic most written about for headsets, software and applications are really the driver for consumers.  The holy grail for XR headsets is to be able to use the virtual experience as a ‘theater’ when watching videos or movies, using the device as a window into highly realistic gaming, and to replace multi-screen desktop monitors with an ultra-large virtual desktop.  Some of these functions are part of the OS and some are application based, but the ease with which the user is able to achieve the three major functions are the determinant for success currently.  AI adds a bit of complexity to the mix (mostly at the developer level) but can simplify use by performing some of the functions that might have been done by the user, but again, we are at the very early stages of Ai integration.

From the consumer standpoint AR/VR headsets are confusing.  VR headsets are bulky and isolating but some have the ability to ‘see’ the real world through cameras that mimic eyesight.  AR headsets are not isolating and typically less ‘weighty’, making them a more practical alternative for everyday use, but there are now two flavors of smart glasses, those with a display and those without, which seem to have replaced what were once thought to be AR glasses.  The reality of these variations is that many consumers are unsure what they are buying and what they might be used for.  Expecting smart glasses to be able to project a walking path for the user a few steps ahead will prove to be disappointing if one purchases smart glasses without a display, as directions can only be verbal, but easily met using smart glassed with an internal display.
Unit volume data and forecasts for each of these devices is also confusing, especially as the importance of each category has changed radically over the last year.  VR headset growth has slowed this year as the user base for VR tends to be limited to gamers.  Those purchasing VR headsets for a ‘virtual experience’ are likely to still be a bit disappointed in headset performance as the software does not seem to be able to create a true ‘virtual leap of faith’ for all users.  AR headsets are almost not a thing as they have morphed into smart glasses with displays, and smart glasses without displays are essentially a more mobile extension of a smartphone.  With all of these changes in a short period of time it is no wonder why estimates and forecasts are a mishmash of data and do little to give consumers much information.

Growth estimates for these categories are equally obtuse as the newer categories are coming off of a very small base last year and product combinations are different for each brand, but it is almost a moot point given that Meta (FB) dominates most of the categories with over a 60% share on a general basis.  Throw in the Chinese market, which shows different product acceptance patterns than the US and that mishmash becomes a large pile of poorly assembled data.
At the same time consumers are confused about what they are buying and what they can do with each device.  Now that ‘AI’ is stamped on every box, consumers are rushing to buy smart glasses so they can walk down the street, get directions to the nearest CVS, be directed by their glasses to the nasal spray aisle and have the AI purchase for them using their CVS bucks to lower the price.  Unfortunately smart glasses are not quite at that point yet, and if you purchased a pair without a camera, you would have to listen to turn-by-turn directions rather than see them virtually, and integrating your glasses into CVS’s system is far above current capabilities, so you would be forced to ask for directions to the nasal spray and actually wait on line to pay.
Given the strong sales of smart glasses in China mentioned earlier, one would believe consumer excitement to be at or building to a fever pitch and that is the case on large Chinese retail sites like JD.com (JD) where the volume of transactions for smart glasses has increased by 10x, but there is a catch.
JD.com and Tmall (BABA) are reporting that while sales are very strong return rates are around 30% for smart glasses, with the primary reported reason being “Lack of functional practicality”.  An example would be that Xiaomi’s recently released AI glasses, which sold 70,000 units during their first week of release, faced a return rate on the Douyin (pvt) platform was ~40%.  Consumers were disappointed by the fact that the glasses were essentially earphones with a camera and left the consumer to still rely on their smartphone, although a bit more time reading the spec sheet might have given an indication of the device’s capabilities.
Where brands now have to be very careful is to make sure they are not leading consumers down a path of disappointment by over-promising capabilities during a period of market enthusiasm, as that disappointment will live on with consumers even as the products grow more sophisticated.  Meta seems to get the idea with their recently released Ray-Ban display smart glasses that don’t promise to create a virtual experience but provide the functionality that gives them value, the opposite of Apple’s (AAPL) Vision Pro XR headset, which over-promised and under-performed.  Don’t promise the world, just find things that make smart glasses useful to consumers, and they will beat a path to your door…

Meta (FB) announced a number of new products last night,  a 2nd generation of the company’s Ray-Ban AI headsets and similarly equipped Oakley’s, and an entertainment hub for Meta Quest users, but what we have been waiting to see was the 1st iteration of the company’s Meta Ray-Ban’s with a display, an actual AR device, rather than a headset with a camera that are in the shape of glasses.  We have no problem with those who use existing Meta Ray-Bans, but to us they are little more than connected headphones.  Once you add a display, the options increase considerably.  You don’t have to listen to a voice read text to you and you don’t have to guess as to whether the picture you just took captured what you wanted, you can see things on the display.
The glasses themselves are a bit bulkier and heavier than regular Meta Ray-Bans but not so much as to be obvious, but they do have some differences.  The most obvious is the display, a single LCoS (Liquid Crystal on Silicon) 600x600 full color projector that sits on the bottom of the right lens and gets projected onto the user’s eye lens through a reflective waveguide that is built into the lens itself.  The waveguide is constructed of partially reflective mirrors that move the image from the projection point, through the lens, to the user’s eye.  The user sees the image as a high resolution display a short distance in front of the right eye, just a bit outside of your direct gaze so that it does not obstruct the user’s view of the real world.  The user lowers their gaze to directly view the image.
We note that due to the fact that the display is monocular (one-eye) it has been described as ‘ghostly’, something all monocular systems must deal with.  We expect in order to keep the cost under a certain price point and reduce weight, the decision was made to use only one projector, although the $800 price point is still above our expectations.  We note that the company promotes the device as ‘non-intrusive’, meaning the image does not dominate the user’s view, but there is a fine balance between image detail and clarity and the need to make sure the user is not distracted by the image.  The image itself has a 20 degree FOV against a ~200 degree total FOV and is said the appear like a 13” monitor display in front of the user. 
While we have yet to try it, the glasses come with a ‘neural wristband’ which adds a way of issuing commands to the glasses without using voice or pressing buttons.  The wristband uses electromyography to detect muscle movement pattern signals using sensors in the wristband.  The wristband processor translates these patterns into commands, allowing for hands-free control of the device, removing the need for ‘talking’ to the glasses to get them to perform application operations.  The wristband processor has been trained on thousands of participants and is expected to be usable immediately, without extensive training.

So you know how it works, but what can it do, other than relieving you of the incredibly difficult chore of taking your smartphone out of your pocket…

• Directions – The glasses use the Bluetooth connection to your smartphone to access a number of location systems to provide the user with a turn-by-turn walking guide to your destination, along with a map of the immediate area.  Meta AI pinpoints your location and calculates the route.  The glasses provide a ‘glanceable’ image, rather than a fully immersive map, along with prompts for turns, street names and other pertinent information, allowing you to avoid having to hold your phone and constantly look down at the display while walking.  While the glasses have their own GPS system, they are essentially a ‘remote display’ for your phone’s navigation system.
• Meta AI – The Meta AI is always available to provide answers or other information via a Bluetooth link to your phone. Your voice requests are sent to Meta’s cloud servers for processing and the query answers are either shown on the display or reported via voice.  Most AI processing (other than internal functions) are done off-site using Meta’s infrastructure. 
• Messaging – As Meta owns WhatsApp, Facebook Messenger and Instagram Direct, messaging is an important focus forf the glasses.  Since you can communicate with the glasses without using your voice, the scenario below will no longer happen…

You are 30 minutes into “Nobody 2” at the 86th street Orpheum with your husband and another couple.  You feel the buzz of your phone and dig through your purse for your phone.  It’s a text from your bestie who says her relatively new boyfriend (still single at 31!) wants to take their relationship ‘…to the next level’ and desperately wants your advice on what to do.  You whisper to the hubby “It’s work.  I have to take this”, grab your purse, squeeze past 10 other people in your row and up the aisle to the lobby, where the ticket guy is vacuuming the carpet.  You make the call but it’s too noisy, so you head out front and join the group of Chick-fil-A staff smoking next door to finish the call.  Then it’s back inside, down the aisle just to squeeze past the same 10 in your row.  Your husband whispers,
“Is everything all right?”
You whisper back,
“Yes,  they wanted me to stay late tomorrow night to run a meeting, but I told them no.  They have some nerve calling at 9:30 in the evening the day before!”
With the new Meta Display glasses when you feel that buzz you just slip on the glasses and using the wristband, navigate to the messaging app, display it in your field of view and read the message.  To respond, you write the response on your leg or the popcorn box (any flat surface) using gestures via the wristband.  You ask the AI (no voice) to check for spelling or structure, and you send it, without anyone the wiser.  You keep the glasses on, just in case you get a response, with the display turned off (for the time being) and you return to watching the movie, without losing context, as your left eye and ears were still watching the movie and feeding your brain with bits of clues to keep you in touch with the plot

• Audio – A 5-point microphone array helps pick-up voices and reduces wind noise while built-in speakers play back music or audio without blocking your ears from outside conversation, Again, all functions can be controlled with the wristband.
• Video – The glasses have a 12MP ultrawide camera for photos and videos and the display acts as a viewfinder along with zoom.  Without the display, you pointed your head in the general direction of the subject but had to look at your smartphone display to see what the actual image or video looked like, which often meant taking another shot or missing the chance.  Now the viewfinder shows exactly what you are shooting. 

The glasses can also livestream and can be set to integrate with fitness apps to automatically take video clips at certain points during a workout (not sure why, but it can).  There is a red LED that indicates when you are recording or taking an image to avoid privacy prosecution or having the glasses smashed by someone who is in WITSEC.  We note also that the camera can be used with the AI essentially showing the AI what you are seeing.  A simple “Hey Meta, what am I looking at?” tells the camera to take a picture and send it to Meta AI to be identified.  You can leave it at that or ask for more information about the query, all of which is displayed..  To avoid privacy concerns the camera does not continually stream video to the cloud.  It only does so when asked.

• Translation - The glasses can perform live translation of conversations. The microphone array listens to the person you are speaking with and can either provide a translated audio of what they're saying or display real-time captions of the translated speech on the display.  The glasses can also capture your side of the conversation and translate into another language, but your foreign partner would have to use your phone to see the translation.  Currently English, Spanish, French, Italian, German, and Portuguese are available.  In some cases a downloadable language pack can make use of on-phone translations, but in most cases the conversation is sent to your phone, then to Meta AI servers, then back to your phone and to the glasses.  The translation system can also be used to translate a sign, menu, or any document with text and show the translation on the display or read it to the user.

So, we live in a miraculous world where, according to the Zuck “You can stay in the moment while using Ai to improve your senses, your memory, help you communicate better, and make you smarter.”, but the reality is the only difference between this new Ray-Ban species, and the old Ray-Bans is the display and the wristband.  Considering the new glasses are ~$400 more than the old ones that seems a hefty increase, but when we price out the cost of just a few of the display and wristband components, in addition to the components similar to those in the non-display Ray-Bans, we come up with ~$625, so at best, we can assume if you buy the glasses through Meta they are likely generating a margin a bit under 30%, and if sold through Best Buy (BBY) or other retailers, maybe 10% to 15% to none, depending on the retailer incentive margin.
The problem is that we see the device as over the $500 ($499 sounds better) sweet spot, and while it certainly offers the convenience of the display, which enhances some of the applications, it is still a smartphone adjunct and does not have that new application that will convince users that they must have such a device, regardless of cost.  If it were $499, more would consider it in its present state, but until the price comes down or new applications are added we are not convinced that “staying in the moment” is worth $800, although it is a great step in the right direction, with a few more steps to go.

Toward the end of this month, it is expected that Samsung (005930.KS) will be announcing a number of new products, including its first entry into the ‘smart glasses’ market.    Given Samsung’s profound reach into the CE market, their entry, regardless of its success or failure, will likely stimulate another round of growth in the category and increase the level of competition between brands.  Samsung filed a number of related patents toward the end of last year which began the speculation over what form Samsung’s entry into the smart glasses/XR market might take, with Project Moohan, the code name for the company’s XR project, being developed with Qualcomm (QCOM) and Google (GOOG), and Project Haean the code name for the smart glasses that we expect to be announced this month.  The Google tie-in relates to Samsung’s co-development of an Android XR OS, which will likely be a part of both projects. 
To our chagrin, expectations are that the upcoming Samsung smart glasses will not have a display, making them essentially hands-free access to audio, AI, and a camera.  We expect Gemini, or a subset of, will be the AI, and as noted above, the OS will likely be Android XR, with the Qualcomm Snapdragon AR1 chipset.  More importantly will be the applications, as the device will compete directly with Meta’s (FB) Ray-Ban glasses, which sell for between $250 and $300, so point-to-point feature and price comparisons will be a big focus.  One of the more sophisticated features of the Ray-Bans is ‘look & ask’, where whatever the camera sees the AI sees.  Using that function allows the user to look at an object and ask a question about it, without having to describe the object to the AI first.  We expect Samsung to have a similar function if it is to really compete with Meta, although we believe that the longer-term success of smart glasses will be greatly enhanced by a display.
Smart glasses (formerly Augmented Reality) are becoming a popular way of interfacing with features that might have normally been included in smartphones or their applications.  However the feature sets for smart glasses are varied and increasingly more complex as these devices compete with each other.  In order to better understand and simplify the features that are available to smart glasses users, we break down the feature sets under the broad categories of those that have a display as part of the glasses, and those that do not. 
The smart glasses that do not have a display are relatively easy to understand, with early models providing only audio, either through an open-ear speaker system or through bone conduction.  These devices typically connect through Wi-Fi to a smartphone that the user might keep in a pocket or travel bag, but their functionality was relatively limited and competed with wireless headphones and ear buds, a well-established niche.  In order to improve the value to consumers, a camera was added, which allowed the user to capture images or video that could be played back on the user’s phone, but such devices were still considered gimmicky and not mainstream.  
While AI did not appear in a true sense in mass market smart glasses until Meta’s (FB) Ray-Bans were released, a number of glasses were based on virtual assistants that were able to perform a number of basic functions, including web searches.  However the current crop of smart glasses that is making its way into consumer hands is working toward far more sophisticated AI functions and that is the big selling point for smart glasses that do not have displays.  The more functions that smart glasses’ feature sets have, the more value they create to justify the price, but to us, the real kick for smart glasses begins with the display which adds an additional ‘dimension’ to these devices and helps to justify a higher price.
Unfortunately, the average Joe or Jane does not want to spend hours comparing feature sets for smart glasses, and as smart glasses evolve brand will pack in more features and complexity.  To illustrate, we examined a number of smart glasses and categorized them based on just a few (very simplified) hardware features.  There are a number of subsets for each of these features and many more feature categories and types, but the flowchart shows how complex choosing these devices can be, and we have excluded anything relating to how the devices look, which is another major selling point for most potential users. 
We started with two basic classes of smart glasses, those with displays and those without.  While these seem like simple categories, there is nuance across this level, with some having electrochromatic lenses that can reduce the amount of light passing through the lens.  Those with displays enter into an even more complex path with first, the type of display (Micro-OLED is currently the leader).  Some displays are mini-projectors that project an image on the see-through lens or the user’s eyes, using optics like waveguides or a birdbath to mix a projected image with what the eye is seeing, and some have only one display (monocular), although the majority have two.  From that point the feature set trail for glasses with displays follows the same path as those without displays, which entails what type of audio is being used (speakers or bone conduction), how the glasses connect to the smartphone, and whether the device has a camera and AI.  Again this is a simplified feature set, with the full set decision tree 2x or 3x more complex.
The question that must be answered however, if smart glasses are going to survive as a CE product stand-alone category, do they provide value against cost, essentially are they able to augment the functions of a smartphone enough to justify a $200 to $300 price tag without just duplicating smartphone functions?  Glasses with speakers but no camera, even with AI, are like using earbuds with your phone,  Add a camera and you can take pictures and video, but more importantly you give the AI ‘eyes’.  Add a display and you no longer have to listen your AI chatter away, you can read what it is saying while you are doing other things, and if the applications become more viable over time, eventually you wont need an expensive smartphone and could replace it with a small pocket computer and your smart glasses.  Maybe we are getting a bit ahead of ourselves, but smart glasses (AR) have the potential to be long-term players if CE companies don’t see it as a threat to their lucrative smartphone profits.  They should be able to live side-by-side.

​Baby Boomers tend to shy away from immersive technology, having grown up on audio platforms and TV, while younger generations seem to have no trouble donning headsets and gesturing wildly as they venture into AR/XR/VR worlds.  When it really gets down to where such technology will be over the next 10 to 15 years, the only group to ask are teens, and that is just what the XR Association did with 600 teenagers between the ages of 13 and 19.  The idea was to compare current answers with a similar survey taken in 2022 to see if and by how much opinions about immersive technology had changed.
Here are some of the findings:

• 44% of teens have personally used a VR headset, compared to 38% in 2022.
• 52% of teens have used XR in school, compared to 49% in 2022.
• 21% of teens personally own a VR headset.

Teens adopting XR technology recognize its educational value and report increased integration across the following subjects:

• Math: 16% in 2025 v. 11% in 2022
• Art: 24% in 2025 v. 22% in 2022
• Science: 25% in 2025 v. 24% in 2022
• 34% of teens indicate that if a class included XR instruction, they would want to take that class
• 24% of teens indicated that they would more likely pursue a college that offers XR as a part of its curriculum.
• 25% of teens are interested in XR careers.
• 20% of teens expect to use VR in their future jobs.

When teens were asked how they are using immersive technology here’s what they said:

• 65% said XR can be used for fun
• 61% said XR can be used for creativity
• 46% said XR can help to connect with friends
• 44% said XR helps with learning.

But not everything was positive when it came to XR and immersive technology.  Here are some of the concerns expressed by teens in the survey:

• Cost – In 2025 50% saw this as a concern v. 58% in 2022
• Addiction – In 2025 44% saw this as a concern, while in 2022 it was 51%
• Spending less time outside – In 2025 it was 43% v 48% in 2022
• Privacy – In 2025 it was 43% while in 2022 it was 45%
• Lack of Access – 34% in 2025 v. 44% in 2022
• Bullying – 15% in 2025 v. 17% in 2022. (Not sure how Xr might help this?)

The survey also pointed to an increased awareness that moderation and privacy tools lead to a better XR experience:

• 82% report a greater enthusiasm for XR when they are aware of moderation and privacy tools
• 62% are aware of moderation and privacy tools.
• 67% say that using moderation and privacy tools improves their experience.

XR is thought to be creating more inclusive and supportive digital spaces for teens, which encourages community participation.  Here’s what they said:

• 43% of teens have used XR to participate in online communities and events.
• 63% of teens report a positive experience with XR that made them feel included, regardless of disability, language, or other barriers.

While there was no conclusion from the XR association, the direction was obvious, as one might expect from an industry association whose job it is to promote the technology.  That said, we were a bit surprised how little change there was between the 2022 and the 2025 results in many of the categories.  With the proliferation of XR devices from Mata, Apple, and others, we would have thought teens would be more enamored with the technology and more excited about its prospects.  We do temper our disappointment as we view XR as a way to become free from desktop monitors and as an adjunct to our ability to satisfy our constant curiosity with a twist of the head or a quick question.  Teens typically have yet to enter the workforce and would therefore have a different perspective, likely on more oriented toward entertainment than making a workday more productive, so we assume that teens will see XR from a slightly different perspective as they grow into the workforce.  For now it is entertainment and education as the focus for XR, neither of which are surprising for those under 20.

Buying a pair of glasses can be a traumatic experience.  For many, they are going to be wearing those glasses for most of the day, every day, for years, and a wrong choice can be devastating.  Now choosing glasses has become even more complicated as the glasses you choose that will help you read and keep you from stepping into traffic are not the only ones you need.  Not only do you need those prescription glasses (and maybe prescription sunglasses) but you also need a pair of AI glasses, now the hottest thing in China, where brands large and small are competing to grab consumer attention in this relatively new category.
In fact, similar glasses have been around for a while, but those were AR glasses that allowed you to overlay digital objects or text over what you see through ‘regular’ lenses.  Those are still a thing, typically dominated by Metsa’s (FB) Ray-Ban glasses, but as Ai becomes more embedded in our society, the drift is toward AI over AR, and in some cases both. 
So what are AI glasses?  Typically they look like slightly bulky sunglasses but have an integrated voice assistant that can understand what you want, similar to Siri, Alexa, or Google (GOOG) Assistant.  The voice assistant hears your commands through a number of microphones embedded in the frame and passes it to an LLM that parses speech the same way it parses text queries (actually not the same way, but similar).  The response can either be an answer or an action, typically responding through speakers also embedded in the frame or bone conduction modules that are touching your ear.  Most have some sort of image/video camera that can be activated to record an event or conversation, with some allowing direct livestreams to social media.
Of course, there are the applications that are usually on your phone, which is a necessary part of many AI/AR glasses, that communicate with the glasses, either by wire or wirelessly (typical) and allow the glasses to make calls, receive messages, and give you notifications, but when it really gets down to it, the applications available to each brand of glasses, whether AI or AR or both, are what makes them useful.
The most common application, aside from the basic messaging and notifications, is translation, which can be as complex as sentence by sentence instant translation that appears before your eyes (AR), or voice translation through the speakers.  This is not just for when you are traveling to another country, as anyone living in a metropolitan area is likely to face a few foreign speaking people each day.  They might not be talking to you (think nail salon, bodega, hospital, bus terminal) but it sure is nice to know what people around you are saying.  Existing aural applications like Spotify (SPOT), Apple (AAPL) Music, Amazon (AMZN) Music, or Deezer (DEEZR.FR) can be easily piped to your glasses, so no headphones or earbuds needed if you have glasses, but in the race to outdo other AI/AR glasses brands, there are lots of other applications that are finding their way into said glasses.
Object and scene recognition is one application that garners attention as it can be used for shopping (You see that person’s shoes? Find them for me”) or for navigation (“Tell me where I am -based on these buildings”), and while the navigation application seems to us to be the more important of the two, it is probably the other way around.  There are also health applications, with sensors that measure heart rate or oxygen levels and even some that are set up as hearing aids that use the embedded microphones and conduction systems to avoid having to stick obtrusive devices in your ears to hear.  There is even a set of glasses that can change their tint electronically and some that can read head or hand gestures, making it unnecessary to give a voice command unless a question needs to be answered..
As it is still very early in the ‘smart glasses’ game each new application or feature pushes that device forward into the public eye, only to be surpassed in days, weeks, or months by new features that catch the eye of consumers on another device.  Unlike smartphones however, which typically cost between $500 and $1000, smart glasses are less expensive and there are rumors that Chinese smartphone brand Xiaomi (1810.HK) is going to release their own branded smart glasses this year for just a bit over $200, making it difficult for smaller brands to compete.  While that might limit innovation a bit, it is certainly good for consumers who will benefit from low prices and feature competition similar to the smartphone space.
All in, we expect the smart (AI) glasses segment and the AR/XR segment to merge over the next two years and for new applications and features to drive expansion in the space.  But we also believe that in a relatively short period of time, most smart glasses sales will be based on large CE brands that exist today, with those brands focused on high unit volumes that will augment smartphone sales.  That said, it will be a delicate balance to keep smart glasses from eating into smartphone sales as some of that smartphone functionality shifts to the glasses.  We can also see a scenario where small inexpensive pocket computers, designed specifically for branded smart glasses, could replace smartphones altogether, but it is too early to make that call as consumers are just beginning to see the utility that smart glasses provide and designers are still trying to figure out the best ways to integrate AI functions.  It’s just the beginning of the cycle.
 

average guy or gal in the street might not know much about this 5-day event, or even care.  In most instances there is little reason for the average Apple user to pay much attention to what is discussed at the conference, as they will likely not see the actual changes to their devices until much later in the year if they notice them at all.  But this year could be different in that not only will Apple present developers with a new version of iOS (iOS 17), and new versions of iPad OS, MacOS, Watch OS, and TV OS, as they typically do, but the company is expected to announce the long-awaited XR headset that has been rumored for years.
Apple’s XR development program has been around in its current form since 2017, but Apple has been making acquisitions relating to AR/VR since 2014 (see below) and allows developers access to a number of tools and resources that they can use to create AR and VR applications for iOS and iPad OS and have access to the Apple Store.  But Apple itself has not championed a physical XR headset, disappointing developers and fans a number of times in the past.  The most recent ‘rumored’ device, the Apple Reality Pro, would be Apple’s entry into the XR hardware space, and would be a driver for the industry, that in the long run, would likely have even more impact than Meta’s (FB) Quest series of VR headsets, as Apple’s
hardware following, with over 2 billion active devices, to Meta’s ~20m Quest headsets sold.  Of course, Meta has over 2b active Facebook users, along with Instagram, Messenger, etc., but hardware is Apple’s thing.
If Apple does decide to make an announcement concerning an XR device, it will be to stimulate developers to build or modify apps to operate under what will likely be a new sub-OS specifically designed for Apple’s XR hardware, seemingly called xrOS.  This code will work under iOS and will allow the device to communicate and process applications that reside on a secondary device, such as an iPhone or iPad.  Making the headset a ‘non-standalone’ device, reduces the bulk, weight, and computing power on the headset itself, making it more comfortable to wear, a concept not lost to Apple developers who are likely following many Apple design mantras that are consumer oriented over technology oriented, while tethering also means at least one other Apple device must be purchased or owned for the headset to be operated.
Expectations are that the headset battery, which in some headsets is in the headset itself, will likely be external, perhaps a belt or pocket clip-on, with a cable to the headset, while the communication between the headset and the paired device could be a cable or wireless, but the Apple XR device is also expected to not sport controllers, which would be a departure from the norm.  It has been suggested that Apple will use gestures to control the headset, with a large number of cameras scanning body movements, eye movements, area mapping, and even facial expressions for information that the xrOS can use to keep the user’s field of view correct.
The displays are expected to be something close to 4K micro-OLED displays, with on-board processing through Apple’s own SoC, either the M2 or a specially designed processor, with a focus on power efficiency given the battery-driven nature of the device, but while developers will be interested in the internals, consumers will be more concerned with how it looks, how it feels, and can it do things other AR/VR headsets cannot, and the idea that the device can operate as both a VR and AR device is not new.  Other VR headsets allow a black mask to be removed from the headset, allowing it to operate as an AR device through cameras, so the proof will be in the applications themselves and how easily the headset operates. 
​As we have noted recently eye-tracking is becoming  more popular as it facilitates foveated rendering, and movement tracking are common, so it will be incumbent on Apple to devise a gesture system that is intuitive for consumers, but on an overall basis, for Apple to have a successful product, especially on that is expected to cost between $2,500 and $3,000, it must be able to provide functionality, as while there will be an initial rush from ‘I always buy the newest Apple product’ people, it better provide more than ‘coolness’, and much of that will come from applications.  While the iPhone is a well-designed device, as are most Apple products, it also serves as a communication hub for its users, and while we do not expect an Apple XR headset to become as ubiquitous as an iPhone in the near future, it has to be able to do more than play games or allow you to buy things in the Metaverse.  We keep our expectations low but our hopes high.

ederico Capasso, a former Bell Labs (NOK) applied physicist who was one of the inventors of the quantum cascade laser, and now a Senior Research Fellow at Harvard, came up with the idea of using metasurfaces for flat optics in 2016 and has been leading research in this new field since, with over 70 US patents and over 500 peer-reviewed journals (not all on metasurfaces).  The idea of metasurfaces, or sub-wavelength thickness structures that are placed in a horizontal manner, is similar to that of more typical optical lenses that focus light using refraction, while metasurface optics use small nanostructures to scatter light and by capturing and changing a number of optical characteristics, including phase, polarization, and spectrum, can be used for a number of optical processes that are typically done with glass or similar medium.  The shape and patterning of these nanoobjects determines their optical characteristics, opening an almost infinite range of possible shapes, sizes, and materials for these lenses, which are typically in the range of 100nm thick, or 1/100,000 of the equivalent optical lens.

What makes metalenses important is that they are produced using photolithography or ALD (Atomic Layer Deposition), both of which are used in the manufacturer of semiconductors and a few years ago MIT scientists developed a computational technique that determined the optimal makeup and arrangement of metalens elements, enabling designers to meet specific optical parameters, reducing prototype and rework timelines.  As, in theory, the process by which the metrastructures scatter and re-emit the source light is !95% efficient, such lenses are thought to have an advantage over conventional glass lenses in terms of cost, size, weight, and performance.  Further a single refractive lens (glass) can project an undistorted image onto a curved surface, but in order to project on a flat surface, additional lenses are needed to eliminate the curvature distortion.  As much in the image sensor world is flat, only a single metalens is needed for a flat (2D) surface, such as in a smartphone, eliminating the need for the lens ‘bumps’ seen on most smartphones.
Companies like Imagia (pvt), NIL Technologies (pvt), and Metalenz (pvt) are developing applications that try to simplify the optical stacks used in a number of consumer electronics’ applications.  STMicro (STM) is using a metalens in its 6/22 release of a ToF (Time-of-flight) module, using Metalenz technology that is produced on STM’s silicon lines.   The device uses two metalenses that substitute for the more typical optical lenses and has a power consumption of 31.3% less than that of the optical version in continuous mode.

​While metalenses sound game-changing, and they are to a degree, they have two flaws.  The first is that they are small.  Achromatic lenses, meaning that the color remains the same through all parts of the lens, is relatively easy to do with glass, essentially making the lens thicker as it gets larger.  Metalenses are achromatic when small (few hundred microns), but have color aberrations as they get larger, which limits them to very small applications.  There have been positive lab results using a large number of such lenses to stich together a wide-angle image, but with no commercial application yet.  The efficiency of metalenses is the 2nd flaw, and while such is over 80%, meaning 80% of the light that enters the metalens is ’converted’, Fresnel lenses (plastic on glass) and pure glass lenses are higher, and as noted below, this can be an important factor in some applications.
One area of particular interest is VR, where complex optics add considerable weight and bulk to headsets.  Flat metalenses can be less than 1mm thick and are rectangular, which matches the format of most digital image sensors.  With pixel pitch below 10um, such lenses allow pixel or even sub-pixel beam steering and can replace optics that require a number of lenses or steering mechanisms.  Since VR displays are small, typically 1” or less, the size issue is less of a factor, but efficiency is more so, as the clarity of the image in VR is key, but considerable research continues and as better materials and patterns are found, there is considerable hope that higher efficiencies can become available, with a recent lab process having 94% efficiency, albeit not in a commercial setting.  The use of DUV (Deep Ultraviolet) patterning has led to higher efficiencies but work still needs to be done to move those results from the lab to commercialization.
All in, if metalens research is able to conquer a few limitations, they open a whole new world for AR/VR and a host of other applications that rely on physical optics.  Glass manufacturers and optical component companies do not have to worry about their business yet, as metalenses are still primarily a highly specialized field that has potential but no guarantee that it can be competitive with 3-dimensional optics, but every ounce of weight that can be removed from a VR headset will make them more compatible with the general public and metalenses are trying to fill that bill.