- Augmented reality (AR) headset maker Meta said it's still in business "contrary to recent industry rumors" and promised a future statement about its restructuring, according to an announcement. A filing with a Delaware court last week "inadvertently revealed" that the company is insolvent, Next Reality reported.
- Meta CFO John Sines allegedly said in a Jan. 9 letter to a judge overseeing a patent infringement lawsuit brought by Genedics that Meta is "insolvent" and that the company didn't have financial means to hire a lawyer or provide a settlement offer. Meta in 2017 filed a motion to dismiss the lawsuit, describing Genedics as a "non-practicing entity that has never made or sold an augmented reality device."
- The judge on Jan. 10 issued an order saying Meta has until Jan. 24 to respond or it would be found in default, VentureBeat reported. Meta CEO Meron Gribetz furloughed two-thirds of its staff after a $20 million investment from a Chinese company was suspended amid threats of a trade war between the United States and China, Bloomberg reported in September.
Meta's public statement around the company's operations follows a bumpy year for the company and other developers of wearable AR technology. The financial woes for the industry again demonstrate the importance of being well financed to develop products that haven't yet gained widespread consumer acceptance almost seven years since Google tested the waters with its failed Google Glass product. The outlook for the company is unclear, pending any additional notice from the company or its PR representative.
Meta's possible insolvency follows financial difficulties for other AR startups. Blippar last month announced it had entered administration, a U.K. form of bankruptcy, as part of being liquidated after an investor dispute. Osterhout Design Group (ODG), a maker of AR glasses, planned to have an asset sale of its patent portfolio this month, UploadVR reported. While Magic Leap last year released an AR headset after years of development, it mostly received lackluster reviews from the tech press.
AR startups have struggled while tech giants like Google, Microsoft and Apple either have AR headset products on the market or are planning to develop them. Google ended its Glass Explorer program in 2015, but later relaunched the product as Glass Enterprise Edition for workplace uses, per Wired. Microsoft recently filed a patent that appears to be a lower-cost version of its HoloLens AR headset. Apple is said to be developing an AR headset that's set to hit the market as early as 2020 and has its own display and operating system, per Bloomberg News.
Despite the difficulties of companies like Meta, the AR industry is forecast to still hold plenty of market potential. Worldwide spending on AR and virtual reality (VR) will grow 68.8% from 2018 to about $20.4 billion this year, according to International Data Corporation estimates. Sony, Vive, Oculus, NordicTrack, Pico and Cybershoes were among the companies to demonstrate their latest technologies for AR and virtual reality (VR) at last week's Consumer Electronics Show.