microsoft holo lens

Microsoft HoloLensGroup Members:

Chen Xinyun (A0100351E)Chong Jia Lin (A0100818N)Glen Yovianto (A0100041M)Jin Hao (A0119269W)Tan Qing Wei (A0097466M)

Group Project for MT4002National University of Singapore

1. About Microsoft

2. Augmented Reality VS Virtual Reality Technology

3. Target Customers

4. Value Proposition of Microsoft HoloLens

5. Method of Value Capture

6. Competitors Comparison

7. Scope of Activities

8. Strategic Control of Microsoft HoloLens

Content

Firm: Microsoft

• Founded by Bill Gates and Paul Allen at 4th April 1975 at Albuquerque.

• First Customers: IBM and their first Product is MS-DOS.

• Their Business model evolve overtime

From selling operating system, to software, and extending to hardware (such as Microsoft X-box and Surface). Now they are expanding towards AR industry.

Now, majority of the sales came through Microsoft Office business.

Technology: Augmented Reality and Virtual Reality

Both technology allows users to interact with the image/environment to a certain extent. Each technology has its own advantages.

Augmented Reality Virtual Reality

A technology where computer generated image orhologram is superimposed on user’s view of thereal world.Example:HoloLens

A technology where three dimensionalenvironment or image is created such that itseparates users from the view of the real world.Example:Oculus Rift

Microsoft HoloLens

http://youtube.com/v/bpXVuRulSHw

http://youtube.com/v/bpXVuRulSHw

Customers - HoloLens

• Enterprises

• Designers and Researchers

• Gaming and Entertainment

Value PropositionMicrosoft HoloLens

Value Proposition of Microsoft HoloLens

• For Enterprise

• HoloLens can be applied in corporate training, such that it is more comprehensive since it is not limited to the screen.

• Example: Detailed instruction given through the device, easy direction and inventory tracking.

• For Enterprise

• Untethered communication and real time conferences



• Allows users to create a virtual prototype enhancing efficiency of designing and research

• Example: Visualizing new product instantly



• Cooperative Design/Research regardless of distance.


• Gamers and Entertainment

• More immersive experience in gaming


Method of Value CaptureMicrosoft HoloLens

Current Strategy

• It is sold at 3000 USD.

• Target: Developers in America and Canada.

Microsoft is aiming to built a developers community

Reasons: Developers will create additional value for HoloLens.

More complementary products (software) for HoloLens will attract more user base.

• Each party are limited to buy 2 devices.

Reason:

To prevent redistribution. Device is still not ready yet for public use.

Good move!

• The first target: Developers

Microsoft can improve its learning curve by involving external developers to

improve its product.

Less Labour Cost.

Learning Curve = the more technology is used, the more effective and

efficient Microsoft is able to create HoloLens.

Future Strategy - For Enterprise

• Microsoft HoloLens

• Sell the equipments at discounted reasonable price

• Data can be stored on cloud service or hard drive.

• In the case of cloud service, a subscription fee will be implemented

• Ensure data protection and customized interface for each company

• Since the training materials are made to be compatible with HoloLens, it will not be compatible with other devices -switching cost.

• This result in increase of barrier of entry.

• Profit from sales of the device.

• Computer and Laptop (Dell, ASUS)

• Sell the equipments at reasonable price

• Data can be stored on cloud service or hard drive.

• Profit from sales of the device.

Future Strategy - For Designer and Researcher

• Microsoft HoloLens

• Sell the device at reasonable price

• Collaborate with other companies that store design data such that the data is compatible with Microsoft HoloLens.

• Microsoft benefits indirectly from Network Effect enjoyed by these design data storage company

• The bulk of the profit comes from the sales of the device.

• AutoDesk ThinkerCAD

• Allow users to register for free

• User are taught to use the interface and create design inside

• User creates content which increase the value of ThinkerCAD

• The increase of content amount will attract more user and thus creating a Network Effect.

• Profit comes from Premium Content. AutoDesk gets a certain percentage of the design bought by users from another designer.

Network Externalities/Effect

Future Strategy - For Game and Entertainment

Microsoft HoloLens

1. Sell the device at reasonable price

2. Reasonable profit from the device

3. Profit from the game goes to the gaming company completely.

4. Incentives to attract more game developers. This in turns attract more customer to buy HoloLens.

5. A Network effect is created.

Profit comes from the sales of device

Console Game (Sony Playstation 4 /Morpheus)

1. Sold the console at very cheap price

2. Profit from the device is very small

3. Earn money through royaltyCertain percentage of the profit game maker earns goes to the console maker

4. Value of the device goes up as more people using the device, bringing complementary product (software developer)

Profit comes from royalty

Overall

Microsoft HoloLens profit will come from the sales of the device

itself.

Competitors ComparisonMicrosoft HoloLens

Microsoft VS Competitors

Microsoft HoloLens Facebook’s Oculus Rift Sony Morpheus

Augmented Reality Virtual Reality Virtual Reality

Uses holograms, places virtual objects in the space around you.

Interacting with real world.

Untethered.

Image replaces the real world, no transparencies.

Seated experiences.

Plugged into a computer.

Image replaces the real world.

Can’t be effectively used without controllers.

$3000 $350 -

Microsoft VS Competitors

Microsoft HoloLens Meta Pro

(Spaceglasses)

Atheer One Glasses Google Glass

Augmented Reality Augmented Reality Augmented Reality Augmented Reality



Untethered.

Uses holograms.

Untethered.

40 degree field of vision.

Precise gesture detection, with virtually no lag.

Untethered, connects to android-based computer.

65 degree field of vision.

Image on top of user’s view.

Can be used at anywhere, both indoor and outdoor.

$3000 $3650 $500 $1500

Microsoft VS Competitors (different technology)

Microsoft HoloLens Pandora’s Box by Wygwam Google Cardboard

Augmented Reality Nanotechnology “Virtual Reality”



Untethered.

Hidden video projectors for the video

mapping.

Kinects to calibrate the projections as

well as to trigger the users’ scenarios.

NFC (near field communication) to make

inert objects communicate with various

devices.

Uses simple materials such as

cardboard, magnet, lens to get

virtual reality effects.

Untethered.

Differentiation from Competitors

● Enhance experience with reality

○ Display the image together with the real world

○ More productive

○ Example: Virtual sticky notes on refrigerator

○ Organize notes virtually, greener environment as it reduce the use of paper sticky notes

● Wireless

○ Freedom to walk around and use the device at different areas

Differentiation from Competitors

● Wearable

○ Easier to carry around compared to pandora box as user can wear it

on their eyes

○ Plastic inner band to adjust the headset

○ Gesture controlled, no need for additional controller which is unlike

Sony Morpheus

● Good image quality

○ 720p 3D rendering

○ Not too close to the extent of seeing individual sub-pixels, which exists

in some VR headset

○ For instance, Google cardboard is more likely to cause vertigo, nausea,

and headache

Scope of ActivitiesMicrosoft HoloLens

R&D and Manufacturing

• Outsourced to Foxconn

• Reduce the manufacturing costs

• Focus on the hardware and software development

• Collaboration with various research institutes and business

corporations

Marketing

• Press Conferences and Hands-on Workshops

• makes use of reporters’ reviews to promote the product

• Exclusive Technique

• limited to two devices to one developer

• making the eligible subset of customers feel special. This creates a better

customer business relationship and is proven to increase brand loyalty.

Distribution

● Phased distribution strategy

• Sell HoloLens direct from Microsoft to developers and enterprise

• Estimated commercialization : 2020

• Distribute HoloLens to a selected number of hardware specialists

• Widen its distribution to all resellers after a few years

Vertical Disintegration - Hardware

Outsource • Intel’s future generation of Atom processors

• RealSense gesture control

• Cherry Trail

Inhouse• “Holographic Processing Unit”

• handles the integration and interaction of real environments and virtual objects

• Kinect 2 Sensors

• Depth and 1080p colour cameras

• Infrared sensor

Vertical Disintegration- Software

Outsource

• Collaboration with 3D processing companies

• Autodesk, Unity Technologies, Dassault Systèmes

• Collaboration with Research Institutes such as NASA

Inhouse

• Compatibility of Universal Windows applications

• Game : Minecraft

Strategic ControlMicrosoft HoloLens

Strategic Control

• It is more than a gaming device

Better able to handle the prices of HoloLens than personal consumers!

Strategic Control - Software

• Compatible with Windows 10

• HoloLens can hedge on the growing market

share of the Windows 10 software to market

the HoloLens as complementary product that

has high compatibility with the Windows

software.

Strategic Control - Economies of Scale

• Microsoft enjoys a huge reputation and market share in both the IT

software and hardware industry

• Can tap into other revenue sources to achieve economies of scale

Strategic Control - Intellectual Property

• Bought over patents needed to create HoloLens, as well as IP assets for

a) Augmented reality

b) Wearable computers

Creates Barriers to Entry!!

End of PresentationMicrosoft HoloLens