What Does Microsoft Have In Virtual Reality That Apple Doesn’t … – Investor’s Business Daily

Watch for Microsoft's "Project Scorpio" Xbox to make an impact on the gaming market later this year. (omihay/Shutterstock)

Microsoft's (MSFT) ambitions in augmented and virtual reality are going to get a big lift from the "Project Scorpio" Xbox gaming console due out this fall, says Loup Ventures.

"Typically, when we talk about the future of AR and VR, the firstcompanies that come to mind are Apple (AAPL), Google (GOOGL), Facebook (FB), and Snapchat (SNAP); however, Microsoft does not receive enough credit for the strong positioning it has already built," said Loup managing partner Gene Munster, in a blog.

While virtual reality immerses a user in an imagined or replicated world such asvideo games, augmented reality overlays digital imagery onto the real world.

Microsoft's gaming platform is key, says Munster, formerly an Apple analyst at Piper Jaffray.

"Of all of the companies vying to own VR and AR platformsof the future, Microsoft is the only one to have a gaming console," he said.

Digital Foundry, a gaming website, disclosed Xbox Project Scorpio specifications last week. Microsoft announced the gaming system at the Consumer Electronics Show in January.

IBD'S TAKE: After a 12% gain last year,Microsoft stock is up about 5% in 2017. It has formed a flat base, with a buy point of 66.01. Learn more at IBD Stock Checkup.

At CES, Microsoft said that it had reached 55 million monthly active users on its Xbox Live platform, up 15% from the previous year.

In addition to VR gaming capabilities, the new Xbox will feature 4K video. Microsoft's main competition in VR gaming is Sony (SNE), says Munster. Sony released a PlayStation VR system in November. Sales reached 915,000 in late February, Sony said.

"While Microsoft doesn't produceany VR hardware, it sells (Facebook's) Oculus Rift headset in its stores and has included the Xboxcontroller in Oculus Rift bundles," said Munster. "Oculusseems like the logical choice fora VR headset partner forProject Scorpio."

Microsoft's next gaming consolewill also support headsets expected out in 2018 from Lenovo, Dell, Acer and HP (HPQ).

Microsoft shares ended trading Monday down 0.2% to 65.53.

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What Does Microsoft Have In Virtual Reality That Apple Doesn't ... - Investor's Business Daily