Comfort, better visuals, easier to use with your hands. That's the takeaway from HoloLens 2, Microsoft's follow-up to the Space Age goggles it announced four years ago. The technology behind the $3,500 (about £2,700 or AU$4,900) HoloLens 2 device, which Microsoft calls "mixed reality," overlays computer images on the real world. Imagine arrows directing you down the street as you walk, or repair instructions floating over a machine as you fix it. That's MR's promise, Microsoft says.

The company was the pioneer in augmented reality worlds when the tech giant debuted its first headset, in 2015, charging companies $5,000 apiece for the gadget. Since then rival devices, such as the $2,295 Magic Leap, have come on the scene.

Now playing: Watch this: Watch Microsoft demo Hololens 2 at MWC

At prices like that, MR headsets are far more expensive than the competing VR technology currently on the market. Facebook's Oculus Rift, for example, is $349, HTC's Vive is $499 and Sony's PlayStation VR is $299. You have to buy a computer or PlayStation 4 console to power these VR devices, but even then their prices are at least half what Microsoft or Magic Leap are asking.

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That hasn't deterred Microsoft from designing an improved headset as part of its push into the now far busier AR universe. The company says HoloLens still isn't ready for you and me to use at home though. Instead, Microsoft is focused on companies and the military. (But that's stirred employee dissent, which Microsoft CEO Satya Nadella has dismissed. By Tuesday, more than 250 employees had signed an open letter denouncing the deal.)

Aside from that caveat, Microsoft has made some welcome improvements to the device, which goes on preorder Sunday and will be shipping later this year.

"Computing is embedded in our world, in every place in every way," Nadella said while unveiling the device at the Mobile World Congress (MWC) in Barcelona. "Computing is in everything from connected cars to connected refrigerators, smart surgical tools, and even smart coffee machines."

He said the result is that the approach to how companies like Microsoft approach the technology they make. "It's no longer about being device first, it's about putting the human first, and it includes all the devices in their lives."

"We don't have to just imagine it," he added. "This future is here."

CNET traveled to Redmond, Washington, to talk with Microsoft executives and designers, including Technical Fellow Alex Kipman, and see what HoloLens 2 was all about.

In HoloLens 2 isn't meant for you. But HoloLens 3 might be, we look at where HoloLens fits in the world, and why some techies think mixed reality technology will upend the way we use computers.

"The goal is these things transform humans," said Alex Kipman, Microsoft's technical fellow who leads the HoloLens project. He describes it as giving people superpowers. "This is a concept that's been in our dreams."

In HoloLens 2 feels like practical magic, we share what it's like to use HoloLens 2, its key features and where Microsoft is going next in AR ... and why it's aiming at businesses, and not the average person yet. Take a dive into what we experienced.

In The future of AR, according to Microsoft, Kipman discusses why he's focused on the business market and how he sees devices like HoloLens changing over the next several years.

We also got to check out Microsoft's lab devoted to building products that comfortably work for 95 percent of people, regardless of their height or size. This is where Microsoft made the HoloLens 2 fit more comfortably than its predecessor.

In HoloLens 2: why it's really all about the cloud, ZDNet's Mary Jo Foley explains Microsoft's newest apps and services.

Here's what you need to know about what Microsoft is announcing in Barcelona at Mobile World Congress 2019.

Now playing: Watch this: Microsoft HoloLens 2: A first dive into the future of...

At $3,500, it's still not made for everyday people

Instead, it's designed primarily for people such as manufacturing workers, industrial designers and those in the military, and for situations where field workers might need to work hands-free. But Microsoft said its $3,500 headset will eventually be ready for us to buy. Someday.

It's arriving in 2019, but it's still not clear when

Microsoft hasn't set a definite release date, but the HoloLens 2 can be preordered now, if you're interested.

James Martin/CNET

HoloLens 2 tracks your eyes

Microsoft included sensors near the nose ridge of HoloLens 2, pointed at your eyes. The technology is used to log you in to the device, saving your individual settings in case you share the headset with a coworker or friend.

Microsoft will also let app developers have access to eye tracking. In one demo, the company showed how a teleprompter could follow as you read. There's also onboard iris recognition, which works with Windows Hello to log in to HoloLens 2.

It also tracks your hands better

The Magic Leap One, and most VR headsets, come with dedicated controllers. The HoloLens 2 doesn't; it relies on hand and voice controls via Cortana. The first HoloLens recognized basic tap and click gestures, but the new headset recognizes 21 points of articulation per hand and allows for more realistic hand motions. Technically, that's the most advanced hand tracking on any AR headset we've tried.

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Field of view doubled

There's a lot to like about the changes Microsoft made with HoloLens 2, but perhaps the most dramatic improvement is to the "field of view," or how much hologram you can see at any given time.

The field of view on the first HoloLens was about the size of a deck of cards a few feet from your face. It was annoyingly tiny. The HoloLens 2 more than doubles that area, to 52 degrees. Practically speaking, it's still not as wide as most VR headsets, but it's better than Magic Leap One.

Now playing: Watch this: The creator of HoloLens 2 discusses its future

Glasses accepted

Unlike many AR headsets and smartglasses (including Magic Leap One), the HoloLens 2 is designed with glasses in mind. The new flip-up visor makes it even easier to slip on, and our demos worked for several team members with glasses.

That's an advantage over Magic Leap, which doesn't work with glasses at all and offers just a limited range of prescription lenses. In 2006, the National Institutes of Health said 14 million people in the country need vision correction of some kind. So, yeah, this matters.

New apps from Microsoft and partners

Microsoft is also announcing new HoloLens apps that it thinks most companies will benefit from. One is called Dynamic 365 Guides, which lets companies put together guided instructions in mixed reality. In one demo, Microsoft had us gather parts for and fix a broken ATV, using only the instructions provided by the app.

Another app, called Dynamic 365 Layout, creates a persistent map of the buildings you're in, and stores them with Microsoft. This allows developers to place a hologram on a table in a room, for example, and if you leave that room and come back a day later or with a different HoloLens headset, you'll still find it there.

Microsoft's newest headset works with new cloud apps, but it doesn't have a cellular connection device. Instead, it connects via Wi-Fi.

Other software and enterprise partners include Spatial, a company developing internet-based office video chat and collaboration software that makes you feel like the people you're connected with are right there in the room with you.

James Martin/CNET

Open system

There's a debate in the tech industry about how computers and phones should work. Should they be "open," like Microsoft Windows and phones powered by Google's Android software? Or should they be "closed" and tightly managed, like Apple's App Store for the iPhone and iPad, promising potentially better security?

Microsoft said it's coming down squarely on the "open" side with HoloLens 2. That device, Microsoft said, will allow anyone to create an app store for HoloLens 2. It will also allow app developers like Mozilla to bring its Firefox browser to HoloLens 2 as well. And even developers like Epic Games can make coding tools for HoloLens, Microsoft said.

"Epic will fully support Microsoft's HoloLens strategy now and for the long term," Epic CEO Tim Sweeney said.

"I have great hopes and dreams will accomplish together in this ecosystem," Kipman said.

Battery life? About 3 hours

Microsoft confidently says it doesn't expect people will burn through an entire battery charge of HoloLens 2 in a single sitting. But in case you might, the device lasts about 3 hours, according to the company. That's similar to Magic Leap and might be better than Facebook's Oculus Go mobile headset, which lasts about 2 hours on a charge.

James Martin/CNET

HoloLens 3 is coming in a couple of years

Microsoft said it plans to announce its follow-up to HoloLens 2 in the next year or two. The company didn't provide any details, other than to say the device will be even more comfortable and easier to use, and that it'll do more than the HoloLens 2.

Kipman said a prototype of the device was what helped Microsoft win a lucrative $480 million contract with the US Army.

Microsoft

Microsoft is also bringing the Kinect back, as an IoT device

The Azure Kinect development kit is a small, self-contained set of cameras and microphones designed to work with a PC or directly to the cloud via Microsoft Azure. The $399 dev kit is also available to preorder Sunday, and was first announced at last year's Microsoft Build conference.

Specs

Here're the speeds and feeds.

CPU: Qualcomm Snapdragon 850 Compute Platform and second generation custom-built Holographic Processing Unit.



Display: Equivalent of a 2k display for each eye, creating 47 pixels per degree -- what Microsoft says is often called a "retina" display -- with a 52-degree field of view. (The original HoloLens had the equivalent of a 720 display for each eye, at a 30-degree field of view.)



Audio input: 5-channel microphone array.



Audio output: Built-in "spatial audio."



Connectivity: USB Type-C, 802.11ac 2x2, no cellular connectivity.



Weight: 566 grams or 1.25 pounds. (The original HoloLens weighed 579 grams, or 1.28 pounds.)



Battery life: About 3 hours.



First published Feb. 23, 9:20 a.m. PT.

Updates, Feb. 25 at 3:13 p.m.: Includes details about pushback against Microsoft's HoloLens military contract; Feb. 26 at 8:30 a.m.: Adds that more employees have signed on to the open letter protesting Microsoft's military contract; Feb. 28 at 5:00 a.m.: Adds details from Kipman Q&A.