Samsung spurs XR device business as new cash cow

Samsung Electronics Co. is accelerating extended reality (XR) device development amid intensifying competition with tech behemoths such as Google LLC and Apple Inc. as the South Korean company, seeing a slowdown in the global smartphone market, seeks to secure a new cash cow.

The XR sector, garnering great attention alongside the recent surge in artificial intelligence, encapsulates virtual reality (VR), augmented reality (AR) and mixed reality (MR).

XR device users can experience three-dimensional virtual worlds for virtual meetings and live translated captions of foreign languages. Experts forecast that XR will be used in an even broader range of industries going forward, extending to areas such as the construction, medical and industrial fields.

Samsung is strengthening its “immersive team,” dedicated to XR within the Mobile eXperience (MX) division.

The Korean tech giant created the team last year and has expanded the number of members to around 100, recruiting talent from key departments such as tech development, marketing and planning.  

NEXT CASH COW

Samsung has partnered with Google and Qualcomm Technologies Inc. since last year to develop XR devices.

TM Roh, head of Samsung’s MX division, is driving the XR device business. Samsung is working on a next-generation XR form factor in partnership with Qualcomm and Google, he said in February of last year when the Korean company unveiled its Galaxy S23 series of premium smartphones and Galaxy Book3 laptop computers.

Samsung, a latecomer in the XR market compared with its global peers, aims to launch its first XR headset this year.

The company, one of the world’s largest smartphone makers by shipment, aims to secure a competitive edge in other fields amid a decline in the global smartphone market.

FIERCE BATTLE

The global XR device market is growing fast with fierce competition among tech juggernauts. The worldwide shipment of XR headsets will reach 11 million units this year, up 47% on-year, according to market intelligence firm IDC. 

Industry watchers forecast XR devices will be a game changer in people’s lives, just as personal computers and smartphones have transformed daily life.

Meta is recognized as the most competitive player in terms of pricing and technology, according to industry sources. The owner of Facebook started its VR business in 2014 by acquiring Oculus VR Inc. 

The company’s XR headset Quest 3, released last October, is priced at $499.99 for 128 gigabytes (GB) of storage and $649.99 for 512GB, cheaper than Apple's MR headset Vision Pro, which is priced at $3,499 for 256GB.

Quest 3 shipments for the fourth quarter of last year were estimated to have reached 2 million-2.7 million units, according to IDC.

Apple has sold around 200,000 units of Vision Pro, which was officially launched on Feb. 2, in 10 days through pre-orders.

Qualcomm unveiled its Snapdragon XR2+ Gen 2 Platform, a single chip architecture to enhance the visual clarity of XR devices last month. In collaboration with Siemens, Sony is planning to launch an XR head-mounted display, a virtual headset for various industries, later this year.

While global tech companies are focusing on XR hardware development, competition will expand to software for the devices, industry sources said. Companies that dominate the hardware market first will likely have an advantage in software development, they added.

Write to Chae-Yeon Kim at why29@hankyung.com


Jihyun Kim edited this article.