Jonathan Hirshon

I didn't expect to cry when I stepped into a demo suite in a hotel mid-afternoon on a Thursday to try a new VR/AR headset. I rarely get emotional in demos anymore. But then I was invited to look at what appeared to be a massive 4K TV in the room I was sitting in. A TV that wasn't there. It was playing the Star Wars: Rise of Skywalker trailer. I thought to myself: This is it. This is the moment when VR finally looks good enough to replace my TV.

It was wonderful. But the magic that Varjo's $10,000 business-focused XR-1 headset can accomplish is wilder than that. I got excited because I've finally experienced a moment where VR and mixed reality could look good enough to become my everyday screens. Varjo's new software for workplaces convinced me that it could be a crazy tool for a new world. But yeah, right now it's not something any regular person could afford.

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The Finnish VR/AR company released its first high-end retina-resolution VR headset earlier this year, and enhanced that further into a mixed-reality upgrade, the XR-1, which just went on sale a few weeks ago. The XR-1 is squarely aimed at companies and institutions that have the money to invest in $10,000 pieces of equipment. Volvo uses the XR-1 to test drive cars on real tracks, and it's also making applications for flight simulation and industrial design.

I hadn't demoed the XR-1's mixed-reality effects before. I have tried headsets that blend augmented-reality hologram-like effects, such as the HoloLens 2 and the Magic Leap. But those systems use transparent visors, layering semi-ghostly 3D effects over reality. Varjo's mixed reality uses cameras that pass the real world into VR, but with extremely low latency. When I put on the large but carefully weighted-for-comfort XR-1, it looked like I was seeing the room through a slightly hazy visor. But it was really a screen.

Scott Stein/CNET

The XR-1 has a VR display resolution miles better than anything else I've ever seen, to the point where pixels aren't visible (60 pixels per degree, but only at the center section of the VR display). Compared to Varjo's VR-1, which I tried earlier this year, the XR-1 blends its different displays to make the whole visual experience seem more seamless. It all seems high-res, but it's a lot more so in the middle.

When you add in the pass-through video, though, things begin to get weird. Now objects can be overlaid into the world and seem like they're there: The resolution and low latency make the illusion work. I walk to a desk near the window, with a chair next to it, that I'm advised isn't real. For a good few moments, I can't tell if it's virtual or not until I pass my hand through it.

An egg-shaped pod chair is placed on the other end of the room, and it blends with the hotel decor. It's eerie, how convincing it seems. I soon realize these experiences are training wheels. Varjo's execs then conjure a real-scale Volvo car rendering into the hotel living room. Outside the headset, a real chair is lined up to match where the driver's seat would be. I enter and sit down. I see the room through the car windows and dashboard. Then reality wipes away and the virtual car I'm in is in virtual Venice. Then I'm back in the room, the car dissolving around me.

Varjo

There's more to come. A pop-up doorway appears in the room and opens wide. I look in and see an airplane cockpit through the portal. I step through into the cockpit, while a real-world chair is moved to line up with the pilot's seat. I sit down and see the detailed panels and readouts all around me. I lift my hands, which can be seen in VR and overlay in the virtual world. They're fuzzy-edged and a bit pixelated, but they're there. Varjo's hand and eye tracking could allow me to interact with virtual objects without a controller, or Varjo can line up real interfaces with virtual surroundings for simulators.

Near the end of my hallucinatory series of demos, I'm given a real metallic ball to hold in one hand, while my other hand holds a Vive tracker, on top of which a virtual silver ball appears. I'm holding one real ball, one virtual one. I look at both. They both reflect the hotel room. I'm inside a virtual MC Escher experience.

I'm writing this post to time to an announcement of Varjo's that's business-focused, and also important: a series of monitor-like 2D interfaces in the XR-1, called Varjo Workspace, can tap into Windows applications such as Unity, Unreal or Autodesk VRED to allow work to be done in 3D VR and on a screen at the same time, which could someday allow developers to stop using their monitors. I got to see this in action as a virtual room's layout was built all around me in 3D, and simultaneously appeared on a curved virtual flat monitor suspended in the air. I have no idea how that would feel over time, but the quality of Varjo's display convinced me more than any other VR experience that it's possible.

Varjo is all business for now, but the next step is to approach consumer products. It's not a crazy idea at all. Qualcomm's vision for future VR headsets is advancing new chips that allow for pass-through mixed reality in VR that sounds similar in theory to what Varjo is already doing on a high-performance end. Someday, what Varjo is showing now could end up in lower-cost headsets at home.