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STORY: Facebook parent Meta revealed the company’s next generation mixed reality headset on Thursday, ahead of an expected announcement from Apple of a similar product.

The new Meta Quest 3 is thinner than its predecessor and the company says it performs better thanks to a new Qualcomm chip.

Meta CEO Mark Zuckerberg teased the Quest 3 on Instagram, saying it features color mixed reality, blending augmented and virtual worlds.

It’s priced at around $500 and is expected to be released sometime this autumn.

“For today’s showcase, it’s all about VR games.”

Meta paired its Quest 3 news with its annual gaming showcase, previewing a slew of games including a Stranger Things VR title.

Several gaming industry announcements are scheduled for this month, including the Summer Games Fest and company-specific events from the likes of Microsoft.

But while Meta dominates the VR headset market, it struggles to sell its vision of an immersive “metaverse” beyond the gaming niche.

After a burst of interest during COVID-19, headset sales tumbled in the first quarter of this year.

The overall AR/VR headset market declined yearly by 54%.

Meta’s Reality Labs dropped in revenue by 50% year-over-year in the most recent quarter.

And there’s another potential challenger next week:

Tech rival Apple is poised to unveil its own first mixed reality device soon.

The iPhone-maker is expected to price its high-end headset at around $3,000.

But the company’s entry may reshape the nascent VR market, which Meta dominates.

Even in the gaming sector Meta is threatened by Sony, which released its own second-generation gaming headset the PS VR2 in February, with significant developer support.