Apple is preparing for the death of the iPhone

The iPhone may be the most successful product of all time, selling over 1 billion units and making Apple the most valuable publicly traded company in the world. Yet Apple already has to face the possibility of a world where new kinds of computers supplant the iPhone, just as the iPhone replaced iPods, and other computers, a decade ago.

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The smartphone is the dominant computing platform today, but Microsoft, Google, Facebook, and now even Apple are already starting to invest heavily on augmented reality technology, which integrates computer graphics into the real world.

The thinking is that one day, this technology will end up in light and portable smart glasses, which will be able to replace all the screens in our lives — even the iPhone.

Apple sees what other tech companies are seeing: The smartphone market is not the growth engine it was a few years ago, and tech companies need something to replace it.

Apple CEO Tim Cook loves to talk about augmented reality. "I am so excited about it, I just want to yell out and scream," Cook told Bloomberg earlier this month.

It's not the first time he's teased a big new product related to AR.

"AR is going to take a while, because there are some really hard technology challenges there. But it will happen, it will happen in a big way, and we will wonder when it does, how we ever lived without it. Like we wonder how we lived without our phone today," Cook said last year.

A secret project



Minecraft in your backyard thanks to ARKit.YouTube/MatthewHallberg

Apple has never said it's working on glasses, although it's been reported that the company is exploring a digital glasses product.

Apple never talks about future products, but it does hint at them in two major ways: through acquisitions and through software releases.

Earlier this month, Apple announced ARKit, which is software that makes it easy for an developer to make AR apps for the iPhone.

It's already producing some amazing results, and although Apple hasn't shown off many in-house developed apps using the software, the idea is that this fall, there will be a number of AR apps available for people's iPhones.

So the hope is that if Apple Glasses ever come out, then there will already be a library of creative, polished applications.

Apple's AR ambitions really got started when Apple bought Metaio, a German augmented reality company, for a price in the hundreds of millions of dollars in 2015, according to a person familiar with the sale. Metaio technology and talent underpins ARKit, with some of its former employees working in a "special projects" camera group at Apple.

And Apple has continued to buy several other companies making AR-compatible tech since then. Last week, it was revealed that Apple had purchased SensoMotoric Instruments, a German company that had built a pair of smart glasses that specialized in eye-tracking, a technology that's seen positively by AR startups.

The purchase of SensoMotoric caught industry watchers by surprise. The German company kept a low profile, and many surveys of the AR landscape omitted them.

But they were a German company, like Metaio. Metaio's CEO Thomas Alt, a German, now says he is a Director of Procurement on a strategic deals team at Apple on his LinkedIn profile.

Apple may be on the lookout to buy more AR companies. A contingent of Apple employees, including Metaio alums, were at Augmented World Expo in California earlier this month, three people who attended the conference told Business Insider. AWE is one of the biggest AR industry events, and most of the big companies in the space, including Microsoft, Facebook, and Google, send people.

Apple was not listed on the list of participating companies and its employees did not identify themselves as affiliated with Apple on their badges, the people said. Apple didn't respond to a request for comment.