Microsoft has reportedly killed its plans for the HoloLens 3

And its mixed reality team is divided on what its strategy should be.


The future of Microsoft's HoloLens is reportedly uncertain as the company struggles to put together a coherent mixed reality strategy. According to Business Insider, the tech giant has scrapped its plans for what would've been the HoloLens 3 in recent months. At least one of the publication's sources believes it's the end for the headset. In addition, the sources said Microsoft inked a deal to team up with Samsung to develop a brand new mixed reality device, which has caused an internal divide within the mixed reality division.

Microsoft spokesperson Frank Shaw denied that the HoloLens is dead, however, calling it a "critical part of [the company's] plans for emerging categories like mixed reality and the metaverse." Shaw added: "We remain committed to HoloLens and future HoloLens development." The company declined to talk to Business Insider about the reported Samsung partnership.

The employees within the mixed reality unit that the publication talked to said different factions within the team are arguing about which area to focus on. Some believe the team should double down on its own hardware, while others think it's better to develop a software platform for the metaverse other companies can use, like the Windows OS.

There are also people arguing whether Microsoft should continue focusing on creating products for enterprise customers or whether the tech giant should also create products for consumers. Some also argue that Microsoft's mixed reality team should fulfill military contracts. Rubén Caballero, the former Apple executive Microsoft hired to head up device engineering for the HoloLens and other projects back in 2020, reportedly wants to focus on consumers and the metaverse. There's apparently such a confusion on what the team's focus should be that Microsoft lost 25 mixed reality employees to Meta in 2021, including veterans who'd been with the company for over 20 years.

One thing's clear, though: Microsoft has big plans for the metaverse. When it announced that it's purchasing Activision Blizzard for $68.7 billion, it said the acquisition will provide building blocks for the metaverse. Microsoft CEO Satya Nadella said: "Gaming is the most dynamic and exciting category in entertainment across all platforms today and will play a key role in the development of metaverse platforms.