This post was originally published on our sister site, VRSource.com.

A new report sheds more light on Google’s plans for virtual reality.

Over the weekend, we picked up a report from Recode claiming that Google has abandoned its plans to launch a competitor to Oculus Rift and HTC Vive. But it looks like that report, if accurate, only revealed a small part of the picture.

According to sources cited by Engadget, Google is still working on a standalone VR headset, one that would blur the lines between virtual reality and augmented reality. The company has reportedly assigned personnel to work on this project over the past months. The device is said to have a display, like the Rift or Vive, but it won’t require a phone or a PC to work. Its functionality will lean towards AR rather than VR, presumably along the lines of devices like Microsoft’s HoloLens and Magic Leap’s upcoming headset.

Very importantly, the source cited by Engadget claim that this standalone VR headset is an “important part of Google’s future plans” and that mobile VR – specifically, Daydream – is just a “stepping stone” towards a bigger VR hardware push.

This last bit contradicts Recode’s report, which suggested Google is more interested in developing mobile VR rather than competing with the likes of Oculus and HTC.

It’s possible that both reports are correct. Google is very forward-thinking. It’s probably working on dozens of projects and experiments at any given time and only a few of them are revealed to the public. Perhaps the Oculus Rift-style project was canned, but the AR-geared project that Engadget talks about lives on.

Read next: Google will be creating its own Daydream VR headset

It’s worth noting that Engadget’s story matches a report from earlier this year from WSJ that talked about a VR headset that featured outward-facing cameras and motion detection chips supplied by Movidius.