This Week In XR December 6th, 2024 ft. Michael Murray, CEO, Kopin

This episode of our This Week in XR podcast is sponsored by Zappar. Zappar is one of the world's leading XR companies. Over the past 12 years, they've won numerous awards for memorable campaigns. They've democratized AR by making tools and SDKs that anyone can use, and they created ZapBox, the world's most affordable mixed reality headset. Most recently, Zappar worked with Unilever to create an enhanced QR code called Accessible QR, which enables packaged goods to speak to the blind and partially sighted. If you're thinking XR, give the team at Zappar a call or visit zappar.com to see how they can help you on your XR journey.

Good morning everybody. I'm Charlie Fink. I'm here with Ted Schilowitz for This Week in XR. It's Friday, December 6th, 2024. We've been at this for a while, but we've been away for a whole lot of weeks. The holidays and other events sort of took us away. You were traveling, I was traveling, Ron's traveling. I don't think Ron's even with us this week. He's off. I don't know how we missed three weeks in a row. That's never happened. We've never missed two weeks in a row. The reason we have three hosts is so that this will never happen, but here we are. So for those of you who are listening and wondering what was going on, really nothing, and that was the problem. But a lot this week, things are bubbling now.

Yeah, the Cameron thing I think is interesting.

That certainly was one of my top stories, because meta needs a hit. The strangeness of where we are entering into 2025 and how the tech world is pivoting into it, just sort of attempting to deal with the political spectrum in a way that people will accept.

I don't think it's about politics. I think it's as simple as money. Meta's got all the money. All that money that TV networks used to make, meta's got that money now. Sure, and has for a long time. But the one thing they don't have is a hit. You know, the Quest, I'm beyond interested in your perspective on this, but I'm beyond blaming the hardware for what's going on with XR at this moment.

Well, to say that meta doesn't have a hit isn't really covering the whole story, because there are plenty of hits in the meta world in terms of interactive entertainment. You know, we've got our Gorilla Tag, we've got our Beat Saber, we've got our Walkabout Mini Golf, we've got many, many economic and social hits. I think Horizons has had moments where it started to churn up a sort of PR-ish Roblox kind of effect, but then kind of fell in on itself again. There's only so much content and so much material that people can absorb and link to, which is why you and I have talked about this forever: all media is a hit factory. There are many more misses than hits. And meta, within the realm of Oculus and the Quest, has its share of hits. I agree with you 100%. Their problem is the other 350 million people in the United States who don't own a meta headset. So it's not a question of have they provided entertainment for the people in the headset; they have, of course, otherwise they wouldn't be using it. So there's plenty of things to do if you like VR in the Meta Quest headset. What there isn't is something that someone who doesn't have a Meta Quest headset would buy one to do specifically.

Well, we've seen mainstream ads. I mean, they're marketing the Batman experience and getting people into it. And have you done the Batman experience?

People tell me not. I've done other Batman experiences over my life, but I haven't loaded this one up. People tell me it's one of the best things. It's like a Half-Life: Alyx kind of execution, on a very, very high level. Doesn't surprise me.

Yeah, you know, I get the press past all these things and I try maybe 25% of them, but of course I jumped on that, just because of all the buzz around it. And I couldn't do it. I can't do games where you navigate with your thumbstick. It made me sick. I can't do it, and the older I've gotten, the worse it is. I used to kind of laugh at people and give them little tips like "just look up, don't look at your feet," but even when they have the little tunnel that tries to minimize that feeling, I cannot do it.

Well, you know who? Going back in time in the arc of VR commercialization, Brendan, one of the founders of Oculus, was very, very hyp sensitive. He could not do VR. And there was a real push to a lot of experiences. Beat Saber would be one of them, where you are anchored in the world and the world is coming at you; you don't have to go out to explore. There are lots of games that don't affect me. For example, you mentioned Walkabout Mini Golf and Tetris Effect. I do not get nauseous in those games because I'm not moving through space in that way. In Walkabout Mini Golf, it's just room scale, so plenty of room to move as long as it's in a six-foot box, but the whole game is constructed to keep me in that box. So it feels like you're free, and you have full agency. Most VR games... I mean, there are VR games that I love. To be fair to Batman and other games, there are some games that I love. I really, really like the World War II flying simulations. I think they're terrific, but I've got to tell you, I can only play for five minutes and I get that feeling where I've got to take the headset off. You get a little sweaty and... exactly, you know that feeling.

Going back to one of my certainly very powerful kind of experiences that I talked about a lot: the very first Batman: Arkham that showed up in the original PSVR was an incredible piece of work. It was really well thought out, well done. They were puzzling, they were solving things. It was way ahead of its time, and still deserves credit. But I think one of the things you're referring to across this sort of hit juncture is this transition, or this kind of arc or separation, between what we refer to as sort of traditional narrative media and interactive gaming oriented media, which is still this kind of Holy Grail that's never really been solved. You're talking about the Game of Thrones being in the movie. I mean, that's the Holy Grail. You want to be in the movie. But after you've made that glib statement, it gets a lot harder to figure out.

Well, and over the past couple weeks, I was using the Apple Vision Pro to look through some of their incredible spends, and really incredibly good production within the realm of three dimensions, which kind of leads us into this Cameron discussion. The short movie, the submarine movie, is really exceptional. It puts you into that world, and yes, it's a very weird and very new thing. They have an amazing thing around the Super Bowl. They got access last year to kind of cover some of the Super Bowl from the sidelines and inside and outside of the locker rooms with the Kansas City Chiefs. And it really is incredible. But it's still that moment... and I talk about this a lot: virtual reality, mixed reality, whatever you want to call it on a headset like that, on a box-on-face style headset, is still an exotic beast, and will be an exotic beast regardless of the hit level of the content. People may gravitate to it for a moment, but then they gravitate away from it.

You know, I think that's true. And that also, by the way, was true of HBO. Game of Thrones ended and a lot of people dropped HBO because that's the reason. Part of what media dynamics does. But I do think that if James Cameron could make an Avatar for the Quest headset, people would buy a Quest to do it specifically, and they would get exposed to other entertainment options on the Quest. So I'm hopeful. I mean, I think that's the right thing for them to do. Certainly nobody can afford to make Jim Cameron's movies right now, so this seems like... and he's a lover of entertainment technology. He was trying to do things in movie theaters for his films and experimenting with different formats, so he's probably among the big filmmakers the most... Spielberg too, but he really has been leaning into technology for quite some time, and not just XR but ocean research and all that other stuff.

And the other thing that's surprising: he hasn't found himself on one of Jeff Bezos' or Elon Musk's spaceships or rockets. I think at some point he probably will. The other thing that's really important about the Cameron effect, let's call it, is that he is a real protagonist of true stereo imagery. And these devices are stereo devices by nature. You put them on and you're in stereo. Whether you get delivered a 2D image or a 3D image, the device by its nature is a stereoscopic device. That's why you need an IPD and you have to measure your eyes and you have to land it to where it goes. So the 3D effect is really strong and really natural, which of course makes sense that he would want to continue to evangelize that and find ways to use that. Plus, I'm sure there's an economic deal that makes sense for him to work with a company like Meta that has huge coffers to spend on his pursuits.

Yeah, exactly. I mean, if somebody's going to support his big vision, it's gonna be Meta at this point. So we have a great guest today, Michael Murray, CEO of Kopin. Remember them? So Kopin is back. Michael will fill us in, but they have narrowed their focus and I think have been having a lot of success with that. I've been trying to get him in here forever. Sophia Dominguez from Snap will be with us next week. That's great. After that, we have two of my favorite guests: Shelley Palmer for our year in review show, and then we've got Gary Shapiro who's gonna do pre-CES with us on January 3rd. These are good shows. An incredible get. The next month of our lives as we enter into our little holiday December into January is going to be great. We're gonna have really interesting guests. Are you looking forward to CES?

Yeah, I think so. I mean, you and I both look forward and we have trepidation around CES. There's always something to look forward to. It's weird to look forward to something you know you're going to hate while you're doing it. There's that many humans in one place, it's always difficult to navigate, but we manage somehow. We've always managed. I'm gonna try yet another new strategy to make Vegas tolerable, and I'm going to stay in a downtown hotel rather than on the Strip.

Yeah, that's smart. I think that's a good idea.

Oh, the one thing I should mention is that last week I got a chance to do the Snap glasses, their augmented reality thing. I think they exceeded my expectations in many ways. The brightness of the displays: we actually went outside into the bright California day sunlight and walked through some experiences there and looked at some of the Niantic stuff, and it is workable and usable outside. I think some of the choices they made to build a device that has a very large vertical field of view and not so much about the sides... they had to sort of tackle one or the other. They changed the format to be more like a smartphone, and it wasn't bad at all. I thought it was very good. It just goes to show you that we've been focused on field of view rather myopically. It turns out if you're designing good content, people will move their heads and do what they need to do to consume the content, so it isn't that big of a deal anymore.

Yeah, so you know what I got to play with here? I've even got them right here. It's the new Xreal glasses. First of all, super light. Somehow they finally made these things sit comfortably on my nose, where I see the whole 140-inch virtual screen. But it's got one-click anchoring for the spatial screen. They added a chip, a very specific chip. It was very Android focused because they could do that on Android devices, but for us in the Apple ecosystem, you always had to add a little adapter piece or something that was a Rube Goldberg mess. But now you just click the red button and you anchor your screen. You could move your head, you could do whatever you need to do, and it sits there like a regular screen would in the physical world. The other way didn't bother me that much where the screen moved with your headset because I don't otherwise have the headset on, but there's no question this experience is way better. It's a huge leap for them. Just plug and play. No beam, no adapters. I just plugged it into my iPhone, I plugged it into everything to see, and it's wonderful. There's good video and good audio. It's under 90 grams.

It's a birdbath optic, not waveguide, but it works great. The new optics make the screen larger, the field of view is bigger, and they're great as a screen extension device. It's assisted reality as opposed to augmented reality. I would say that also about the Ray-Bans, which are also really wonderful, especially with the addition of Meta AI. And by the way, when that AI is connected to the internet and it can integrate some of the data from your phone, your gyroscope, your geolocation, it is going to be a world-changing event. So I know Xreal is... I talked to Chi last week and he said they were working to integrate AI. They don't really have an articulated AI strategy yet, but the idea that you can talk and your glasses are filled with sensors that are feeding data into your AI is a thing, and it's going to be very important to agents. And the agent battle is heating up. In fact, I'm going to make a 2025 prediction right here. I think while CES will be about wearables coming back, AI will be everywhere, and the Christmas gift of the year is going to be the Ray-Bans. I think they're going to sell 10 or 20 million of them, minimum, because they're only $300 and you actually have something to do with them. And if Meta... well, you know, there's Character AI, there's this new company called Convergence AI. Everybody's got a strategy for how they're going to become your agent. Because once you become somebody's agent, you just have your hand in their pocket and everything. The value of that must be thousands of dollars a year per person. It's like a credit card.

Well, we're seeing all the cues to what people were kind of keeping an eye on in the early smartphone era, where these convergence moments started to happen and use case moments started to happen. Now we're starting to see what you and I have been talking about for literally generations: the wearable step. What will it take to start to achieve that? The Ray-Ban stuff starts to show that, what you just showed with the Xreal starts to show that. Xreal will show up big at CES. They'll have a big presence. They always do. They have such good taste. I want to give credit to Chi and those guys. They have good taste, they have good marketing. I just don't think the product has really lived up to the hype. It reminds me of the old Apple. But he is a very persistent guy, and he's got a vision and he's following it. He pivots when he has to, he's not dogmatic about it at all. But the way they've evolved these glasses is truly impressive, and their investors are hanging in with them. They've built their own factory, they built their own chip. He's thinking big. So I think Xreal is not going to go away. I think they're going to be a serious indie competitor to the meta-Samsung-Google thing that's going to emerge. We're literally in front of our eyes and our faces, watching the ecosystem evolve and mature. There will certainly be winners and losers, but now we're starting to identify who has the resources to win. One thing I wanted to talk about—we've got to get to Michael, he's in the waiting room—but one thing I did want to talk about is the slow rollout of Apple Intelligence, and some of the things they've done are good, and some of the things they've done are so half-assed you wonder how they're ever going to catch up to these other companies. But it's Apple, it doesn't matter. They can screw this up for months, weeks, years, and when they finally get it right, they're number one.

Well, what's interesting is they have leaned into fully... maybe you always wonder, is anybody listening out there to some of the stuff that you and I talk about? I pontificate constantly on the fact that Apple learns from others and slow rolls everything they do. They don't try to put things out first, and they worry more about how they deliver, not what they deliver. There was a Wired article I was just halfway through reading about Tim Cook, and he totally talks about how being first is never important to Apple, which is the truest statement that anybody's ever made. Apple is hardly ever first in any category. And Apple does stumble occasionally, but because they slow roll their stuff, they're able to work their customer dynamic in a way that is beneficial to them. And I think AI, because it's such a minefield and so challenging, their only choice was to just verbalize that we're just going to take a slow and methodical approach to this, and we're going to try and find the ways that it works best, and really try to be true to protecting privacy, which is mostly true. At the same time, they do partner with... privacy is gone.

Yeah, they are, and then we're just going to make it worse because we want the benefits. You know, why do you post photos for everybody to see? There are all sorts of reasons why you shouldn't, and very few that you should. But people decide the benefits of having it out there and making it public are greater than the benefits of having it private. So that shows you how much people care about their privacy. Everybody cares about their privacy until somebody hacks their credit card or bank account. It's hard because I see things that I do that are like, should I do this? But sometimes it's just expeditious to do it. The only thing I'm super paranoid about is my Social Security number, but it's out there too between your credit card monitoring service. It's just out there. Your credit card companies already have all that.

So Michael's been trying to get in. Oh, there's some issue there. Here we go. Hey, good to see you.

Nice to meet you. And our third wheel, or fifth Beatle depending on how you want to put it, Rony Abovitz, could not make it. He's on the East Coast, so this is in the middle of his workday. For us, we've been doing this at 8 a.m. forever because it's really before the workday starts here in California. But anyway, it's great to have you here. Ted and I were just talking about how Kopin has been visible and part of the XR community for more than a decade, founded by that great scientist John Van, who I was a fan of because he had very strong points of view about wearables and was very pragmatic about them at a time when people were spinning giant fantasies about what they may be someday.

Well, Charlie, let me interrupt for a second because we always forget to do our 100,000-foot view: what is Kopin, what do they do, why do they do it? So thank you for that before you get to your question, Charlie.

Yeah, I mean, when you look at the level of sophistication of what your devices do and how you build them, for our listeners, these are not consumer level devices. These are industrial level, military grade applications. They're not built to be light and portable and super powerful; they're built for the highest demands of industrial use as well as military defense applications. And you can't have any downtime, and you can't have any kind of early tech jankiness. It has to be 100% uptime and 100% accuracy. Those kinds of precision demands are very, very... So in some of our thermal weapon sights or displays that go into the F-35 as an example, we deal with what's called FOD, or foreign object debris. And that can be a fraction of a skin cell that gets in between the polarizer or the lenses that we use for magnification on our displays through the optics. If we have that foreign object detection or debris, it could be a submicron pixel that's not acceptable to our customers. So we have the highest performance, highest reliability applications that we work in. But moreover, we're now taking that to the next level, which is we're adding AI, we're adding software components and sensors to our microdisplays with the neural display architecture, which we just announced. Our AI software development has now reached its new milestone of interoperability. That technology we think has tremendous opportunity for us not only in the defense and medical market, but now the consumer companies are coming back to Kopin and saying, "Look, we don't think we have this architecture right. Six cameras in the Apple Vision Pro is too many. Six cameras in the Oculus or IVAS Microsoft system is too many. It's too heavy, too hot, too much power consumption, too much cost, and the coprocessing that needs to go along with that. We think your neural display application that has the ability to do eyetracking inside the display has a lot of merit." And I think we're excited now to say that we're having those discussions with consumer companies and spatial computing devices companies to solve that problem: size, weight, power consumption, and cost. So a very interesting time for the company, and we're at an inflection point with this whole spatial computing market, as you said, Ted correctly. When I joined, many of these companies are going back to the drawing board, which is good for Kopin.

Kopin, just to not put too fine a point on it, for most people listening, the new Kopin is not a brand they're likely to see on a device, right? Because Kopin is one of the main components inside the device. But outward facing, it's IVAS or it's Meta or another hardware maker's brand.

Correct. So our liquid crystal display is built here in Westborough, Massachusetts. Our OLED technology, we designed and built our backplanes at multiple different fabrication plants, but the deposition of that was done in China. If you recall, we still have that workflow that we can use for low-cost applications, but for US DOD we moved that deposition process outside of China obviously. So that was the first thing I did as CEO: to make that move. And it was an unpopular one because people thought we were exiting the full focus on consumer, but I did that for the US DOD with a little bit of foresight. And then we have our Vanguard technology, which is our microLED strategy. We are probably the only company with a production monochrome microLED that's flying in an aircraft today. And then our color program is back in focus. And we also have our liquid crystal on silicon that we develop out of Dalian, Scotland, and that goes into our 3D AOI applications and is very cool for automotive, too, because we have an automotive qualified liquid crystal on silicon microdisplay that is going to be automotive qualified through our armored vehicle program. So a very unique company. And then we've invented the fifth type of microdisplay, which is this neural display architecture that has an imaging pixel that looks back at your eye and specifically looks for white, gray, and black, and that's how we do eyetracking within the display and then do the computations we need to do in the backplane, which is more complex than the Pentium processor at this point. So very unique technology. US-owned, US-based, very focused on defense right now because there's a big spend going on and a big uplift, but medical is now in focus, and we just released some new industrial products as well.

I love this. These are very, very sophisticated engineering practices that you guys are involved in, very hyperspecialized. Where do you find the engineering talent? Who do you bring into your company? How do you cultivate this kind of optics engineering, mechanical engineering, electrical engineering?

I think it's interesting historically that universities and the military have played a big role in advancing technology, and that hasn't been very visible for the past 30 or 40 years, nor has it seemed to be successful. But since the Ukraine war started, and the level of sophistication... we only see, you know, what's the saying? We are always fighting the last war. My father was trained as a plastic surgeon for World War II, and by 1943 they were like, "We don't need plastic surgeons, we need more dentists." So in that sense, I think they've been kind of behind. But now they see it. Nobody anticipated the importance of drones and how drones in a way are tank killers, a complete surprise I think to everybody. And of course it's used by both sides, so now you have issues about swarming, about jamming, about targeting. The stakes are so high, and the people are so technically skilled. There was just an article in the New York Times about them trying to put double machine guns on these drones, which is just crazy. And they're operated by a first-person operator in a trench somewhere, trying to navigate toward a target. The amount of technology that goes into that is amazing. What's more amazing is how quickly it gets deployed. In times of peace, that is a very slow process because lives are not at stake.

I think so. I think Anduril has tremendous capability in their security software and their edge point software. It is fantastic, and I think Microsoft knows it and needs it. That structure in IVAS, I talk about this often, it's actually far less about the goggle than the backend software and security that goes along with it. That is a tremendous amount of cost and complexity that Microsoft and Anduril will have to focus on and adapt. Where we're focused obviously is in the microdisplay that goes into the goggle, and I think we have tremendous merit to support our troops with the neural display or the microLED technology that we're developing for soldier vision systems. MicroLED, as a reminder, is the Vanguard of Technology. That's what Apple wants, Google wants, Meta wants. They've spent billions of dollars to develop it. We happen to already have one in production. A lot of people don't realize that. But that architecture from microLED to neural display, it's the same backplane. All we're doing is changing one of the pixels to be an imager. So we think we have tremendous merit to solve some of the problems in that area, and we're engaged with all of those companies to bid for that business. I've been very vocal about that because again, I feel like if we were able to support that, we would save lives with our technology. So that's where I think the industry will go. But the third thing, real quick, before I get off this discussion: when we think about drone technology in the future, again it's got to be directed in a very finite precision way. And the asymmetric warfare going on right now requires drones to be much more accurate, as well as the projectiles that you want to shoot down the drones with. So from a thermal weapon sight perspective, Kopin's very well positioned. From a goggle perspective or an ATAK perspective with our monocular, we're also very well positioned to control those drones. So there's a defense and an offense strategy.

I did not, when we were originally talking about IVAS and conceiving what its capabilities were, it did not occur to me or any of the experts that I was conferring with that it would become also an interface for drone operation. But it starts to make a lot more sense when you view drones as sort of a portable artillery that can move with the infantry.

Exactly. Of course, the problem has always been twofold. One is the thing that makes night vision goggles work is the ergonomics. I've got them on, I'm using them, I flip them up, and they're like any other tool. I'm not using it now, I will discard it. And I think going with a spatial display as opposed to monocular displays locked them into that fixed helmet. It is probably better for drone operation because you could fully occlude it when needed, but it does not give the soldiers the flexibility they need to discard it when it isn't helping them. And that's why they've had such spectacular success in demonstrations and such unbelievable failure in the field, getting reports from officers that say things like, "If we used this in combat, they'd get everybody killed." So it'll be interesting to see if those things can be solved. But I've always thought the microdisplay was the better way to go. It's proven, it's ruggedized, it doesn't consume the same amount of power. There's just a whole lot of reasons to make it... you don't need a spatial display to call in an air strike.

Absolutely, 100%. And not only can it help with that, but it also helps with how quickly you can display images so that the human mind doesn't get tripped up that it's seeing something that's augmented. And you have about 500 microseconds. Dr. Hopper of Night Vision Labs wrote a really nice paper that I hope your readers will read. It's available online on AFRL I believe. That paper is brilliant. It basically goes through how the human mind looks at certain images and how quickly your mind will interpret that information and understand whether it's feeling nauseous, fight or flight, all these different things. And you only have 500 microseconds to be able to adapt that, and that's where we put in that spec for neural display. It adapts the brightness and contrast within 500 microseconds so your physical eye has the time to adapt to that vision. And that's a huge thing for things like nausea, fight or flight, this comfort level that needs to be in front of a human being's eye. So that's a real important part of our development.

Can we, with the time we have left, pivot out of the military-industrial complex for a moment and talk about your work in medical? Because I think that's just as important, hopefully in many ways more important, and it'd be interesting to hear what you're doing to advance that, because there's been a lot of attempts and mostly fails or semi-fails at using augmented and mixed reality technology across the sector in medical. But I think you're making some inroads there too.

That's what I was going to say. The typical methodology now in a surgical operating theater is there are many, many monitors with many cameras grabbing super hyper close-up imagery, mostly all two-dimensional. And their distraction point to look up, focus, get back down to the patient... if you can increase that sort of time fidelity where they don't have to move their eyes to another field of view and then lock back down, I think they see efficacy in that and value in that. And you start to prove it. So it's interesting that you're in that field.

But just before you came on, earlier in the show, you know, Apple is one of those few companies that has an unlimited number of at-bats, so they can brush away Siri all they want. But when they get it right, they're going to be the largest and most successful player because of their installed base.