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In late 2021, a team of Meta Platforms employees building a key chip for the second version of Meta’s Ray-Ban smart glasses was notified that the company had decided to go with an alternative chip from Qualcomm, according to two people familiar with the matter. The custom chip would power a variety of functions, such as taking high-quality photos and videos, on the glasses. But Meta’s augmented reality chief, Alex Himel, decided using it could delay the glasses’ launch, expected next year.

The decision was a setback for Meta’s in-house silicon unit known as Facebook Agile Silicon Team. Code-named Brasilia, the chip was part of a broader effort by Meta to control key technologies and reduce its reliance on off-the-shelf silicon providers like Qualcomm, which supplies chips for Meta’s Quest VR headsets, Portal smart video devices and the first version of the Ray-Ban glasses. By building its own power-efficient chips to manage its burgeoning stable of augmented and virtual reality devices, Meta would have far greater control over the features, size and battery life of its products and be better positioned to compete with rivals like Apple.

THE TAKEAWAY

• Meta is building custom silicon for future hardware devices

• It abandoned custom chip for Ray-Ban glasses in favor of Qualcomm alternative

• Silicon team is working on chip for future smart watch

The Brasilia chip design was far enough along that it was ready for trial production. Had it gone further, Brasilia would have been the first in a line of custom chip designs for a Meta-designed consumer device.

The flip-flop highlights the tension between Meta’s goal to build more of the underlying technology for its hardware devices and its desire to get products out quickly. Meta has also run into challenges on the software side. In recent months it abandoned an effort to build its own operating system, XROS, for its forthcoming AR glasses, The Information reported. The first version of the AR glasses will instead run on a customized version of Google’s Android OS.

The stakes are high. AR/VR devices are key to Meta CEO Mark Zuckerberg’s bet on the metaverse, a type of immersive internet in which people will move through digital environments wearing AR and VR devices.

Qualcomm is supplying the key chips for Meta’s forthcoming VR headset, externally code-named Cambria and internally known as Arcata, which is due to come out around September, according to a person familiar with the matter.

Apple, in contrast, is expected to use its own chip designs in its upcoming mixed reality headset, expected to launch later this year or in early 2023, The Information reported last year. Apple has led the way in designing its own chips for iPhones and MacBooks, while Google has begun putting its own chips into its Pixel line of smartphones and is also reportedly making the chip for its upcoming AR headset.

Differentiated Features

Custom-designed chips give hardware makers the ability to offer differentiated features such as translating foreign languages and smoothing out photos, particularly when they’re also building the software, as is the case with both Apple and Google. Buying off-the-shelf silicon from firms like Qualcomm and MediaTek, in contrast, makes it harder for device makers to offer distinctive services. Meta’s competitors in AR/VR devices—including Snap, HTC and ByteDance’s Pico Interactive—use the same Qualcomm chips.

The goal of the Brasilia chip was to add features like the ability to take higher-quality pictures than Meta’s current Ray-Ban Stories can capture, according to a person familiar with the matter. Meta is also developing chip technology to enable AR features, such as audio that sounds like it is coming from different directions and real-time visual filters and effects that are executed on an accompanying phone, according to a Meta spokesperson.

“The goal is to do something that a competitor can’t, which you can’t do if you just buy the same chips that your competitors buy—there’s very, very little differentiation in that scenario,” said Ben Bajarin, an analyst at Creative Studios who covers the consumer tech market. The fact that Apple builds the silicon for its products “allows them to do a whole host of things that others can’t and [to] laser-focus their architectural decisions to their ambitions in hardware,” he said.

While Meta will not use the new Brasilia chip itself in a new product, the company could reuse the technology behind it in other chips for future products, according to a person familiar with the matter. The FAST team is working on other products, including custom silicon components for Meta’s planned AR glasses, known internally as Orion, which are not expected to be released for several years, the person said. This silicon relates to display and machine perception, including motion detection and vision tracking. The FAST team is also focusing on a chip code-named Carson, intended for a future version of Meta’s planned smart watch.

Old Guard v New Guard

Formed in 2018, the silicon team has more than 1,000 employees and is led by Shahriar Rabii, who joined Meta that year from Google, where he worked on silicon engineering and development. FAST is part of Reality Labs—the division overseeing Meta’s AR/VR products—but is mainly based out of the company’s Sunnyvale, Calif., campus. That facility has more lab space for testing than Meta’s newly built Burlingame, Calif., campus, where most of Reality Labs is based.

The FAST team is run separately from a smaller Meta team that develops custom silicon for the company’s sprawling data-center infrastructure. That infrastructure team has about 150 people and has worked on chips for machine learning as well as encoding and decoding digital video, according to a person familiar with the matter.

Complicating FAST’s efforts is Zuckerberg’s desire to get new products into the market quickly, before rivals have a chance to establish themselves, and to remain agile, factors that proved decisive in putting an end to the Brasilia project for the Ray-Ban smart glasses.

AR chief Alex Himel, who has the power to make decisions about product and the market strategy for the Ray-Ban glasses, worried that using the Brasilia chip would delay the release of the second version, based on internal forecasts from his team about the project, according to two people familiar with the matter. Meta’s team already had experience working with Qualcomm’s chips, and hence viewed the decision to stick with them for another generation as lower risk, one of the people said. The decision caused frustration and disappointment among some inside Reality Labs who argued that the company should stick with Brasilia.

Qualcomm, meanwhile, has positioned itself as the leading chip provider in the XR industry. (XR is a catch-all term for VR, AR, and mixed reality.) The company recently announced a $100 million metaverse fund to invest in companies and developers building technologies for the metaverse. Qualcomm has also formed partnerships tied to VR and AR work with Microsoft, Niantic and Pico.

In an interview with The Information in March, Hugo Swart, vice president of XR at Qualcomm, said Meta and Qualcomm had a “very strong partnership,” noting that Qualcomm built its XR2 chip with many of Meta’s requirements baked in. Asked about Meta’s dual role as both a partner and a would-be competitor to Qualcomm, Swart made a comparison with mobile, an industry in which some of Qualcomm’s customers use a mixture of Qualcomm and their own chips. “I think that’s part of the business,” Swart said. “It’s part of how the industry operates.”

Qualcomm is currently developing two new chips that can be used for VR headsets, according to a person familiar with the matter.

The XR2 Pro, which it will likely unveil later this year, is based on the existing XR2, but the memory, or RAM, will be in a separate location rather than built on the main chip, making the device more powerful, the person said.

The XR2 Pro Generation 2, which Qualcomm might unveil in 2024, will be its first chip built specifically for XR. The existence of the chips has not previously been reported. Qualcomm declined to comment.