According to a report from The Information, Pico Interactive, a subsidiary of ByteDance, is changing its strategy for its next consumer-focused standalone VR headset. Instead of directly competing with Meta Quest, Pico is now aiming to compete with Apple’s high-end Vision Pro mixed reality headset, which costs $3,500. The decision to cancel the release of Pico’s next headset, referred to as ‘Pico 5’, was reportedly made due to underwhelming sales of the previous Pico 4 headset, which was released in Asia and Europe to compete with Meta Quest 2.
The report suggests that Pico’s new project, codenamed Swan, will go beyond what was planned for Pico 5 and will incorporate cutting-edge technologies. However, there is no information available regarding the specifics or the expected release date of Swan.
This strategic change comes after reports of layoffs at Pico last month, indicating a restructuring of the business to focus more on hardware and core technologies.
Based on the current report, which has not been confirmed by Pico or its parent company ByteDance, it seems that Pico is taking a similar approach like HTC did in 2019. HTC, a mobile phone manufacturer that transitioned into a VR hardware company, decided to step away from the consumer Virtual Reality market just as Meta (previously known as Facebook) was launching its first version of the Quest standalone headset.
Competing with Meta is no easy task. It seems that no one can effectively compete with Meta in the lower-end VR market. The Quest 2 now sells for $250, and the new Quest 3 is priced at $500. Meta’s social media empire, which includes Facebook and Instagram, regularly operates its Reality Labs XR division at a significant loss, which is offset by advertising revenue. According to previous reports, even Samsung might be targeting the high-end VR market with its upcoming XR headset, a collaboration with Google and Qualcomm.
Pico’s previous headset, Pico 4, was launched in late 2022 in Europe for €429 (128 GB) and €499 (256 GB) and offers support for about 75 percent of the game library available on Quest. However, Pico has not officially launched its VR headsets for consumers in the US, as originally planned.