Meta Quest: Price increase and longer release cycles planned
Meta aims to make its VR business more sustainable and plans to make Meta Quest more expensive and introduce longer gaps between new device generations.
The budget headset Meta Quest 3S.
(Image: Meta)
Meta Quest prices could soon increase. After Business Insider recently reported on Meta's upcoming VR headsets, the US news site has now revealed further details from an internal memo, offering insights into Meta's new VR direction.
In the memo from metaverse executives Gabriel Aul and Ryan Cairns to employees, it states that the company must adjust its business model for sustainability. This includes measures such as extending device cycles and price increases to account for higher costs, such as those due to Donald Trump's tariff policy.
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Three years passed between Quest 2 and Quest 3, launched in 2023, and four or even five years could pass until Quest 4. According to Business Insider, Meta's next VR device will be a lightweight mixed-reality headset, currently scheduled for market launch in the first half of 2027. Quest 4 will follow only after that.
"Our devices will be higher priced in the future, but in return, we will have a healthier business and will no longer feel existentially dependent on the success of a single product," Aul and Cairns write in the memo, which Business Insider has obtained.
Meta sticks with VR despite cost-cutting measures
Meta has aggressively subsidized its VR devices in the past, a fact the executives acknowledge.
The price dumping has created unrealistic price expectations, distorted actual demand, and pushed competitors out of the market. As the market has grown slower than expected in the past two years and Quest 3 could not match the success of its predecessor, Meta's course correction comes as little surprise.
As part of this strategic shift, Zuckerberg has instructed Reality Labs to shift some investments from VR towards AI glasses and wearables. Specifically, this means the VR division will have to operate with a 30 percent smaller budget next year.
The memo indicates that Meta intends to stick with its VR division despite the cost-cutting measures. This is also evident in the fact that two new VR devices are in development and work is being done to improve the underlying software, one of the new strategic priorities. Meta Quest's operating system, Horizon OS, has always struggled with bugs and an immature user interface.
The other divisions of Reality Labs, developing AI and AR glasses, are not affected by the austerity measures. According to estimates, Meta has invested more than 100 billion in VR and AR to date, with no prospect of near-term profitability.
(mki)
