Meta (META) is launching a new, cheaper version of its expensive Meta Quest 3 mixed reality headset. Unveiled during the company’s annual Meta Connect event, the Meta Quest 3S offers the same functionality as the Meta Quest 3 with a starting price of $299. Meta is also dropping the price of the Quest 3 from a whopping $649 to $499.

The Quest 3S offers the same full-color mixed reality features as the Quest 3, but with a narrower field of view and a different overall design. Meta says the Quest 3S also runs on the same Qualcomm (QCOM) Snapdragon XR2 Gen. 2 chip found in the Quest 3.

With the launch of the Quest 3S, the company is also saying goodbye to the older Quest 2 and Quest Pro headsets, which are more expensive.

Meta is positioning the Quest 3S as an entry-level headset for consumers just getting into mixed reality apps and those looking to upgrade from older Quest models. So the Quest 3 is aimed at consumers who are already mixed reality fans and are willing to spend money on Meta’s top-notch features.

According to Meta, the Quest 3S is compatible with the company’s entire library of apps and games and will support upcoming titles such as Batman: Arkham Shadow.

Meta isn’t the only name in the headset business, though. Apple (AAPL) also sells its Vision Pro mixed reality device, but at $3,499, it’s far more expensive than Meta’s offerings. Apple hasn’t provided any insight into the device’s sales figures.

Sales of mixed reality headsets have been tough lately. According to IDC, global shipments of augmented and virtual reality headsets fell by as much as 28% year-on-year to 1.1 million units in the second quarter.

“Over the past few quarters, mixed reality (MR) headsets have made a big leap in fidelity, first with the launch of the Quest 3 and later the Vision Pro,” wrote Jitesh Ubrani, research director for Worldwide Mobile Device Trackers at IDC, in a press release.

“However, the lack of affordable options has meant that few consumers have been exposed to this new technology.”

But the Meta Quest 3S could be a game-changer thanks to its relatively low price. According to IDC, headset shipments are expected to increase from 6.7 million units in 2024 to 22.9 million in 2028.

While that’s a significant improvement for the headset business, it’s still a far cry from the hundreds of millions of smartphones sold each year. Headsets also face stiff competition from the gaming industry, including from console makers like Nintendo (NTDOY), which is expected to launch its next-generation console in 2025, and Sony (SONY), which is preparing to launch a more powerful version of its PlayStation 5 this fall.

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Meta is also struggling to turn a profit on its huge investments in augmented reality. The company posted a $16 billion loss in that segment for 2023, up from $13.7 billion in 2022, and expects that loss to widen in 2024.

Still, as a leader in mixed reality, Meta could be the company that really moves the industry forward. It will just take some time.

Email Daniel Howley at [email protected]. Follow him on Twitter at @DanielHowley.

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