Microsoft lays off mixed reality studio staff - Report

Microsoft lays off mixed reality studio staff - Report

Microsoft is downsizing its mixed reality efforts. The team that runs the Mixed Reality Capture Studios has been laid off.

The first studio opened in Redmond in 2014, followed by others in San Francisco, Los Angeles, London, Seoul and Tokyo.

The studios are designed for volumetric capture. Dozens of cameras film a person from all sides. Software then uses the multiple perspectives to calculate a moving hologram that can be reused for VR and AR content, including games, movies, music videos and advertising.

The studios will be used by both Microsoft and corporate clients. Because VR and AR are still niche, demand may not have been particularly high. Intel ran the world's largest hologram studio for a few years and closed it at the end of 2020.

Microsoft silent about layoffs

Now Janko Roettgers reports that the team has been laid off as part of Microsoft's downsizing. The layoffs stem from social media postings by laid-off employees and came as a "complete surprise" to the team, according to one of Roettgers' sources.

Microsoft itself is not commenting on the layoffs, instead referring to a statement from Microsoft CEO Satya Nadella that does not address the company's VR and AR projects.

It is unclear what will happen to the commercial partnerships. Enterprise customers have reportedly not been informed. According to Roettgers, Microsoft's partners have invested millions in hardware and pay monthly fees for the Azure platform, which is responsible for computing the hologram recordings.


"It should be simple to keep (the platform) going, but that means keeping at least a few software engineers on staff," Roettgers' source said.

Microsoft scales back mixed reality efforts

Microsoft's mixed reality division seems to be particularly affected by the mass layoffs. Microsoft will lay off 10,000 employees by the end of March.

Last week, the company announced that social VR platform AltspaceVR would be shut down in March and that the team behind the Mixed Reality Toolkit (MRTK), an open source interface for VR and AR, would be laid off. The Hololens team was also affected.

With the possible end of Hologram Studios, not many VR and AR projects remain. What is known is that work on the XR platform Microsoft Mesh will continue, and the partnership with Meta for Office and Windows software will likely continue as well. Microsoft plans to bring Windows applications to the Meta Quest platform in the first half of 2023.

Sources: Lowpass Newsletter by Janko Roettgers