​Shiftall (pvt), a subsidiary of Panasonic (6752.JP), has moved (in theory) from an announced VR product to an almost released product, with the announcement that it will be showing its MegaNeX VR headset at CES.  The device is the second one we know of to be using Micro-OLED displays, in this case 1.3” displays produced by Kopin (KOPN).  The headset is among the lightest at ~250 gm (0.55 lbs) and carries 6DoF tracking.  The device is to sell for under $900, although no delivery date or retail pricing is available.  Along with the device are a few accessories, aside from the controllers, and while we usually spend little time on accessories, these are a bit unusual.
\The first is Haritorax, a $275 option, a simpler version of what is used for motion capture in filmmaking.  The ‘straps’ (for lack of a better word) are wrapped around various points on the body and transfer physical motion to a VR avatar through a number of popular VR headsets via Steam VR (pvt).  HaritoraX can run for ~10 hours on a self-contained battery, but to understand this accessory it is essential to watch at least a bit of the promo video, showing it at work.
https://youtu.be/zVg0NRJ8IDA
If that doesn’t weird you out enough, Shiftall has another accessory that goes even further, Mutalk.  Do your kids play video games using headphones with a microphone, and can you hear them yelling and screaming all the way at the other end of your house or apartment?  For us the answer is yes, and Mutalk is here to solve that problem.  The device, which looks like something from The Silence of the Lambs is a mask with a Bluetooth microphone that according to the company, “ensures your voice is broadcast into the Metaverse – not into your living space” and includes a detachable strap to muffle your speaking voice.  If you need even more realism you can strap on PebbleFeel, a device about the size of a remote control that sits on your back and allows the user to ‘embed temperature information into your Metaverse’, allowing the user to ‘feel’ the temperature in their (or other’s) Metaverse, with a range between 48⁰ and 107⁰.
All together, the well-dressed VR enthusiast could be wearing the VR headset, Hartorax, PebbleFeel, and Mutalk, along with the two controllers that are strapped to the user’s wrist (to prevent them from flying off and destroying articles of furniture or other users) to fully enjoy the immersive Metaverse experience.  There are few things we can think of that might scare young children than their Mom or Dad wearing such a get-up and gesticulating wildly while running in place in the den, especially if it ends up with a bout of motion sickness, broken furniture, or possible cuts and contusions.  Welcome to the Metaverse.
 

​While it is a bit early to start making predictions for VR in 2022, we expect at least a few more announcements concerning VR or AR headsets, and a number of demos or product releases at CES this week.  We believe there are at least 13 VR headsets that have already been announced but have yet to be released, so there is already ample ground for product releases, if brands are actually able to produce what they have previously stated.  While all but one of the VR headsets released in 2021 were based on small pitch LCD displays, we expect this year’s crop to be more varied, with at least two Micro-OLED based, and two Micro-LED based headsets, with the remainder being LCD, although we expect quantum dots to be added to at least one display.
We expect this year’[s crop of VR headsets to see a distinct improvement in resolution, likely double the resolution seen on average in those released last year, and while we don’t believe such resolutions (and other metrics) are enough to put VR into the category of a mass production CE product, it does go toward at least improving some of the issues that make VR difficult for a substantial part of the global population.  Prices, at least what we know so far, don’t seem to be changing, with the low end expected to be around $500 and the high end over $2,000, but we expect that the focus on the Metaverse will spur a bunch of new headsets that will try to capture a less ‘gamey’ and ‘social’ crowd, that would likely be a bit more cost conscious, although much of the market will still be dominated by well-known brands in 2022.  We do note that as resolution increases, the need for higher streaming data rates also increases, which should push headset developers to look toward 5G going forward.  No specific plans that we have heard yet, but much will depend on the availability of 5G chipsets designed for VR applications. 
One difference that we see this year is more uniformity on VR platforms.  In 2021, there were a number of headsets that were based on proprietary platforms, making them more dependent on relationships the platform had with developers and limiting content to a degree.  In 2022 it seems that most of the headsets will be based on the Steam VR (pvt) platform, opening smaller brands to the Steam VR catalog and giving consumers an easy and familiar way to buy or stream content, which goes toward making VR easier for rank and file Metaverse participants, who have less desire to work with headsets and more desire to buy stuff.  Removing any obstacles to ease-of-use will go toward opening VR up to a larger audience, but it is still our view that a real “Metaverse” is still years off, and the few Metaverse sites associated with companies at CES 2022 indicate that the level of content sophistication is still quite low.  While we might have focused more on some of the hardware limitations that surround VR, content is what will generate interest (other than money) and we are still unsure as to whether the gating factor is software or hardware (or both).   As with all technology there has to be an ecosystem to support it, and suppliers are just beginning to figure out what might be needed to make such an endeavor work.

​According to our database, there have been 14 VR headsets released this year by 8 companies, 10 of which are standalone types, meaning they do not need to be paired to a device.  Of those 14 headsets, the average price is $643 (although some do not include controllers, which cost extra).  The average weight (of those that disclose) is 454 grams (1.0009 lbs.), the highest being 785 grams (1.73 lbs.) and the lowest being 189 grams (0.41 lbs.).  All but one are based on a single or dual LCD micro-display (one is OLED) and most use a Qualcomm (QCOM) chipset, although they vary as to which Qualcomm chipset is used. 
The most telling statistic from those VR headsets released this year is that the headsets were based on 7 different VR ‘platforms’, usually particular to a brand, such as HTC’s (2498.TT) Viveport, although Steam VR (Pvt) is a supported platform for 6 of the 10 brands.  Horizontal FOV, the distance left to right that you can see without moving, ranges from 90⁰ to 116⁰, with the human eye having a ~135⁰ FOV (non-moving).  There are 12 additional VR headsets that have been announced but have yet to be released, which is not unusual as some of the headsets released this year were announced almost one year ago. 

We have spent considerable time recently concerning the state of the VR/AR world.  VR headsets have made some significant improvements in metrics such as pixel density, FOV (field of view), and weight, but the dreams of a world full of folks wearing VR headsets during much of their waking but non-working hours is still pretty far off.  AR glasses are also improving, and while they do not provide the all-immersive experience demanded by the upcoming Meta-verse, they do provide considerable help to those in industrial environments.  However, as Google (GOOG) and others have found out, consumers do not want to wear AR glasses that are bulky or look like you have just stepped off of the Space X (pvt) Falcon 9, passing on the idea of ‘instant data’ for a good pair of Gucci (KER.FP) frames. 
The idea of always being in touch with social media, the internet, and just about any sort of mobile communication, while wandering around a city such as New York, does have appeal to many, despite the dangers it might create, but implementing such a system still requires considerable expertise in a number of CE specialties and while continuing to evolve, is not easily implemented in a ‘cool’ way.  That was until a California based start-up called Mojo Vision (pvt) began developing an AR device that is not only unobtrusive but would be invisible to the casual observer.  The company is developing an AR ‘contact lens’ that would allow the user to see the same superimposed data that a pair of AR glasses might provide, just by wearing what looks like a contact lens with a bit of a ‘Terminator’ cast. 
The device is powered by a Micro-LED display that is ‘the size of a grain of sand’ and sensors that are internally powered, along with a lens that corrects your vision.  The ‘correcting’ part was what gave the company’s founders the idea that a bionic eye might be able to be used to correct severe vision issues and finding an engineer who had considerable experience in AI, computer vision systems, 3D graphics, and VR, who had his own vision issues, began the push toward the development of what is now getting close to reality.  The display, which has ~70,000 pixels, and is less than half a millimeter across, projects the overlay image directly to the back of the eye (fovea), which is the area of the eye that detects fine detail and is essentially a dense collection of photoreceptors taking up less than 5% of the retina.  Being .48mm in size and having 70,000 pixels, gives the display a ppi (pixels/inch) of 14,000, which is ~300 times that of current smartphones.  The display projects a mono-color image, essentially data, which precludes the necessity of a more complex full color display, and the internal battery, which is rechargeable, can last for an entire day, with future versions wirelessly powered by a device worn on a necklace, although that is still quite speculative.  The device does need a smartphone or similar device to connect to the outside world, with future versions containing communications hardware, but again, that is in the future.
The company, which has raised $159m in seven rounds, including Dolby (DLB), LG (066570.KS),  Motorola (MSI) and a number of VCs, is focusing (sorry) on developing some very specific applications for the device, among which is an application for firefighters, which lays out build plans as the user moves, along with outlining objects that might be difficult to see under smoky conditions (imbedded camera), along with oxygen levels and messages, although the usage shown on the site is more pedestrian in nature.  There are still a number of hurdles that need to be met before such a device can actually be used, some of which might keep the device out of the public eye (sorry) for some time, but with 150m contact lens wearers globally there is certainly a market for just the ability for such a device to improve eyesight, and with the promise of a connection to a world of data without the need for glasses, the incentive is certainly apparent.  While an actual product is still in the future, it’s worth a look at the website to get an idea of what such a device would be capable of[1].


[1] SCMR LLC, has not connection with Mojo Vision, its employees or its partners, and has no investments in any companies, public or private.  We present this information as a reference only and do not suggest that investors take the information as a recommendation to buy or sell companies mentioned.

​If you were not convinced that the Metaverse is ‘real’ in its ability to attract both attention and capital, look at Hong Kong based Arpara (pvt), a relatively new company that released the industry’s first micro-OLED High resolution VR headset and provides ‘arparaland’, a virtual social platform.  What makes this unusual, aside from the micro-OLED display, is the fact that on 12/14/21 the company began a kickstarter campaign to raise $50,000 in 60 days to begin mass production (and get pre-orders) for a March 2022 shipping date.  As of today the campaign (1 day) has raised $421,351 from 714 ‘backers’, who as a reward, get a discount on the “Basic” VR headset, from its $700 list to a $400 reward price or a discount on the ‘All-in-One” VR headset from its $1,100 list to a $600 reward price.  The $50,000 goal was met within minutes of the campaign’s start.
Aside from the interest, the Arpara VR headsets are 2560 x 2560 resolution (each eye), higher than the Oculus Quest 2 (FB) the most popular of the VR headsets (2020) resolution of 1832 x 1920, with one model being tethered to a PC and the other wireless. And far more expensive, even at the discounted price (Oculus Quest 2 starts at $300), but the promise of higher resolution and the high contrast of OLED seem to have done the trick.  Arpara is just one of many small companies that have or are producing VR headsets, all of whom compete with much larger CE companies with vast resources, so the support lifetimes of some of the devices has been rather short.
We are not commenting on the specs or how the Arpara headsets compare on a technical basis, which would be a more technical note, but on the excitement generated by anything VR, AR, or Metaversey.  While there will be many new products released by CE companies at CES 2022 in January, we expect ‘Meta-verse’ to be one of the most common search words relating to CE products in 2022.  While that doesn’t mean there will be an real understanding of the space, but rather infinitely more eyeballs looking for information as to what it is, how it works, and whether it is real or just another CE hype.  Hopefully we can sort out the details in our notes, giving some understanding of how the Meta-verse might work and who is really involved.
Here’s a list of those companies that have released a 2021 or 2020 VR/AR model, giving a better understanding of the type of companies involved in the space that have ‘recent’ products..

We have mentioned that a number of Chinese exchanges have an open platform where investors can directly ask listed companies questions about a wide range of topics.  Most questions are somewhat specific and refer to statements the company has made, statements competitors have made, or in some cases ‘suggestions’ as to how the company might do better or make changes.  Not all company’s respond and in many cases responses are boilerplate and give no answer to the question, but while slogging through many irrelevant or downright ridiculous Q&A sessions, occasionally we come across something significant or important to a company or an industry.  In most cases it is the former, but the type of questions asked, especially over a relatively short period of time can also be revealing and we focus on such a question here.
If we had to typify the question it would be, “How will your company participate in the meta-universe?”  Originally this threw us in that it was difficult to understand how the concept of multiple universes existing in time but in different planes would have anything to do with a panel manufacturer or hardware producer, but we were thinking like physicists or science fiction writers, when the answer was far more simple; sort of.  The meta-universe is a concept that is an outgrowth of what we call AR (Augmented Reality) where you wear a pair of AR glasses from the moment you wake up until the moment you go to sleep.  Said glasses provide information on just about everything and provide a visual overlay on top of whatever you happen to be looking at.
Purveyors of this concept liken it to being connected to the internet 24/7, allowing you to point to an object and pull up scads of information about it without having to connect or use a browser, so looking up at the sky could open up a local forecast or pointing at an item in a store window could bring up item and price information and even allow you to buy it without entering the store.  Sounds cool, although a bit like walking down a street covered with neon signs, but it doesn’t stop there.
The meta-universe concept goes further, especially if you ask those involved in the more immersive VR (Virtual Reality) space, with the creation of a multitude of meta-verses that are not specific to a game or application, but are shared by the global population.  Some of these universes might be specific or dedicated to a particular theme, while others might be more general but perhaps less stressful than today’s reality, but they are all constantly evolving and exist in real-time.  While these idealized universes might seem like playgrounds for those with free time or those looking to de-stress, there is one underlying commonality to all, and that is everything in any meta-verse is digital, including and especially money, so while it might be wonderful to stroll down a street made of rainbows and purchase a unicorn that you can ride every time you visit that world, someone is checking to make sure you have enough digital currency to purchase the item, and someone else is logging where you were, what you bought, how long it took you to make the purchase, and hundreds of other metrics about you that they will either use to target advertising in that meta-verse or sell to some other organization that will use it for something else.
There are many supporters of the meta-verse concept, and here we are not speaking about scientists but companies.  Those that produce imagery for animation and gaming would certainly have a big stake in such a new reality, but as we noted, underlying all of this shiny and futuristic technology is the same old motivation, selling stuff, and finding more ways to grab the attention of consumers.  Vendors will of course eventually latch on to any idea that they think will help them sell more units, but who would really want consumers to have access to a multitude of shred environments?  Social media companies.  What could be better than collecting information about every person, the universes they visit, the one’s they like the best, and what they do when in those universes.  Such data could be worth infinitely more than what you posted on Instagram (FB) last Tuesday, and since those meta-universes (univeri?) will likely be maintained by a consortium of massive server farms owned by companies like Amazon (AMZN), Facebook (FB), Tencent (700.HK), and Sina (SINA), everybody in the social media world will be happy campers.
More interesting however is how such a global meta-universe environment will affect traditional social media.  As pressure continues to build about the emotional consequences of social media and its goal of keeping users attached, an alternative such as shared meta-verses will draw users away from smartphones and more toward AR/VR.  If this eventually slows the growth of traditional social media, it will give those companies some respite from the scrutiny that is developing, while they shift their focus to the developing a meta-universe world, where they can say ‘we are all working together to create a more positive social environment’.  Of course we are likely overly paranoid about such a scenario, but that lack of paranoia has led to a society that wants information only if it agrees with what they think and what could be more enticing than spending much of your day in a world that was developed and maintained for folks with a similar mind-set?  Most shared environment multi-player games are addictive, just think of how much more addictive a shared environment could be if it were fully immersive?

The AR/VR market is growing and there are gobs of statistics and estimates to prove that fact, but even with gobs of data on how big the AR/VR market is expected to be, it needs to be validated by a true believer and not just any true believer, but one who carries significant weight.  While Samsung (005930.KS) is known to lead markets from a technological standpoint and has a vast customer base that loves to try new technologies and new features, when it comes to validating a technology there is none better than Apple (AAPL).  Apple is rarely first with technology advances, waiting to see what might fit into the basic Apple model of selling more stuff for higher prices, and even when they dip their toes in the waters of a new technology they tend to take it slower than most.  However, if they find that a technology allows them to sell more stuff, they go all in, and for the industry that can be game changing.
Recently it has been reported that Apple has requested samples of FMM (Fine Metal Masks) from a South Korean display equipment producer APS Holdings (054620.KS).  Masks like these are used to pattern OLED materials on various substrates to produce RGB OLED displays.  What makes these masks a bit different, aside from the fact that they are not produced by the industry leader Dai Nippon Screen (pvt), is that they have a resolution of 3,000 pixels/inch, which is 4.7x the highest ppi in the smartphone market, and almost 22 times the pixel density of a 32” 4K TV.  These masks are potentially to be used for small, high resolution displays such as those in VR headsets, and while we expect this is little more than one of Apple’s R&D projects, it underlies the industry’s need for a major CE player to get involved.
While big electronics names like Hewlett-Packard (HPE) and Sony (SNE), are players in the commercial VR space, the industry needs a well-known hardware name to gin up consumer interest in VR and there is none better than Apple for legitimizing a technology, even if it has been around for years.  In the case of the APS Masks, they are produced using laser drilling rather than the typical wet etch method, which allows the masks the higher resolution.  Further, most VR devices use white light that is colored by a color filter, similar to the way LG Display (LPL) produces OLED TVS, but just as it does in OLED TVs, the color filter reduces the amount of light the display is able to generate, so the ideal circumstance would be to produce true RGB patterning on a silicon substrate that would eliminate the need for the color filter and produce a brighter display.  If Apple finds the APS masks viable for production, it could set the tone for Apple to venture further into the world of commercial VR.
Before we all get re-excited about VR, we note that looking back to estimates made in 2017, expectations for VR unit volume were for ~100m units to be sold in 2021.  Current expectations are for 6.1m units this year so we are a bit cautious about how quickly even a CE behemoth like Apple could move the market, so we take forward VR estimates with a grain of salt, but hope that Apple does find a way to utilize the APS high-resolution technology that will benefit consumers while keeping us with at least one foot in reality.

China’s Xiaomi (1810.HK) has ‘announced’ a pair of smart glasses that are based on a single color (green) micro-LED display that according to the company, due to its ‘higher pixel density and longer lifespan while having a simpler structure” when compared to OLED.  Unfortunately the company also said that they have no plans to put them on sale but are looking at the device as a concept that shows how such AR devices might one day replace smartphones. 
The glasses themselves are quite normal looking but include a quad-core ARM (pvt) processor, Wi-Fi, Bluetooth, a 5MP camera and the tiny (2.4mm x 2.4mm) Micro-LED screen that is said to be able to generate 2m nits of brightness.  The glasses themselves are running on Android and therefore do not need to be paired with a phone and weigh only 51 grams (1.8 oz.), which is exceptional as they contain 497 components, sensors, and modules and a complex light guide and grating structure to focus images on your eye without the mirrors and lenses usually used

​The software is said to understand what notifications the average user wants to see without confusing or over-burdening and allows for direct calling through a microphone and speaker but most impressive is the device’s ability to translate a foreign language document through the camera and allow the user to see the translated image while speaking with a companion or meeting group.  Again we keep in mind that Xiaomi insists it has no plans to commercialize this product, but it seems as if they went to quite a bit of work and detail to make the devices as practical as possible.  Watch the video below:
https://youtu.be/I9bnmES7O74