Will HoloLens Drive Microsoft (MSFT) Stock in the Future?

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Earlier this year, software developer Microsoft Corporation MSFT dived into the world of virtual and augmented reality with the revelation of HoloLens headsets at a preview event for Windows 10.

Now, at the 2015 Build Developer Conference, Microsoft announced the Windows Holographic Platform for developers to develop apps for HoloLens. It also discussed the progress and provided further details about its virtual reality glasses. Microsoft presented a closer look and gave several new demos at how its new HoloLens will work with Windows apps. It still hasn’t disclosed when HoloLens will be released but it plans to make it available around the time Windows 10 goes on sale.

It also announced that it will partner with NASA, Autodesk, Unity, the Walt Disney Company DIS, the Cleveland Clinic and others for the project.

What is Hololens?

HoloLens is a wireless head-mounted computer capable of running Windows 10 and has in-built processors, motion sensors, camera and translucent lenses and can render high-definition holograms. HoloLens comprises a separate box called the "Holographic Processor Unit” to be worn around the neck.

The headgear projects holographic images to the real world, allowing users to play video games, create 3-D models and interact through videoconferences with colleagues. It marks the entry of the software developer into the three-dimensional holographic computing space. The wearer can walk around and interact with virtual objects without having to tether to a computer or a phone or any external wires.

The Demo and the Reviews Thereafter

At the demo, Microsoft showed that apps could be placed on walls or set to float in space, and resized depending on the user's needs.

It displayed that users in different locations can collaborate on 3D models without being in the same location. Also, any app from Windows 10, including Skype, photos app, or a browser can be used as a hologram, which would enable users to work from anywhere and not just their desk.

Microsoft also showed how leveraging holograms in the real world environment can help, for instance, medical students from Case Western Reserve University and Cleveland Clinic learn procedures and how Trimble can enable its customers to envisage building designs in the framework of real world objects and landscapes.

After the demo, developers expressed their optimism about the device and said that it could revolutionize the way they do their jobs.

Will HoloLens Really be a Game Changer?

The virtual reality and augmented reality market is still nascent. With HoloLens, Microsoft is foraying into the world of 3-D headsets, where Facebook FB is already present with Oculus Rift as a strong competitor. Other Silicon Valley companies in the space include Sony's SNE Project Morpheus and Samsung’s Gear VRsuch head.

But Microsoft’s Hololens will offer an augmented or "mixed" reality experience, unlike Facebook's Oculus Rift. Oculus Rift totally blocks out the outside world to fully immerse the user in another reality, while HoloLens keeps one foot firmly placed in the real world. With the headset, we expect Microsoft to gain a strong foothold in the space.

Going by the reviews, there is plenty of excitement surrounding this new category of devices. But then there's also a lot of skepticism about whether Microsoft’s HoloLens can succeed or not.

Microsoft carries a Zacks Rank #3 (Hold).

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