Microsoft is laying off 10,000 employees, and with it the company is axing social VR platform AltspaceVR and its XR interface framework, Mixed Reality Toolkit.

We’ve written about the death of AltspaceVR once before. In the summer of 2017, the company announced it was shuttering the social VR platform due to lack of funds. In a Hail Mary that few expected, Microsoft turned around and snapped up the ailing platform only two months after the planned shut-down date. It seemed, at least for then, that AltspaceVR would live on to compete in the rapidly diversifying social VR landscape, existing alongside VR Chat, Rec Room, and Horizon Worlds.

Microsoft says it’s shutting down AltspaceVR on March 10th, 2023, and shifting its focus “to support immersive experiences powered by Microsoft Mesh,” the company says in a statement.

Mesh is the company’s software foundation for building multi-user XR applications. Announced in 2021, the tool gives developers a framework for connecting users into shared instances which support spatial voice communication, cloud-based asset management, persistent scenes, and a common avatar system.

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“The decision has not been an easy one as this is a platform many have come to love, providing a place for people to explore their identities, express themselves, and find community,” the AltspaceVR team writes. “It has been a privilege to help unlock passions among users, from educational opportunities for personal growth to the development of unique and wonderful events, groundbreaking art, and immersive experiences — enabling this community to achieve more. With Mesh, we aspire to build a platform that offers the widest opportunity to all involved, including creators, partners and customers.”

Also seeing an abrupt shutdown is the company’s Mixed Reality Toolkit (MRTK). Team member Finn Sinclair shared the news via Twitter on Friday, saying the entire team was eliminated from the company. MRTK was a Microsoft-driven project that provided a set of components and features, used to accelerate cross-platform XR app development in the Unity game engine. Sinclair says the project is remaining open source.

Microsoft’s most recent round of layoffs are said to affect around 5% of its overall workforce. In a letter to employees, Microsoft CEO Satya Nadella notes “changes to our hardware portfolio”; reports from Bloomberg maintain the company’s Xbox games teams are also affected, including Bethesda Game Studios (‘The Elder Scrolls’ series) and 343 Industries (Halo).

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  • poltevo

    This is not surprising, as social VR is hard to compete in and MRTK hasn’t really gone anywhere. I think MS will continue to invest in their Mesh platform, however.

  • ApocalypseShadow

    Not surprising. Microsoft promises then doesn’t deliver. They partnered with multiple PC manufacturers with Windows PC VR headsets. You’d think they would have a slew of games to support them as a rich software company. Nope. No Halo VR, no Forza VR, no Gears VR.

    They promised high fidelity VR for Xbox One X. Gamers went out and bought the system. Then they cancelled the headset giving reasons that no one wants VR or it doesn’t make money. Both false. Many play and buy VR headsets. Many industries use VR. And multiple developers have made money. Sony made money that they are making another one. Delivering high fidelity VR where Microsoft couldn’t.

    They saved Alt Space but did nothing with it. And as we see, are shutting them down. For a supposed leader in AR and VR, you’d think they would put in some effort. Nope.

    Not surprising that they fell back on tools for VR. They want companies and developers using their tools or using Azure or using Windows, etc. They want to be the company in the background making money on others than the effort to grow the industry.

    • sfmike

      “Then they cancelled the headset giving reasons that no one wants VR or it doesn’t make money.” In Microsoft’s world unless any project makes big money within a quarter or two it is axed and corporate profits for investors is the only product that matters to this predatory company.

      • Zantetsu

        Predatory?

        Tell us comrade, how can we ensure that corporations eschew profits in favor of the common good of the proletariat.

        Do we need a new 5 year plan?

  • David James

    As a long time user of social VR and an event moderator, they did the dirty on everyone who trusted them to develop and improve altspace. this underhanded, betrayal is entirely ‘on brand’ for Microsoft.

  • Citizen Came

    What sort of American citizens treat employees as a hardware portfolio???

    • sfmike

      The predatory capitalist kind that we are so famous for.

  • Andrew Jakobs

    Maybe it would have been better if Meta would have bought it back then, then they would have had a head start instead of their own horizons platform now.

  • ViRGiN

    ‘competitin is great!’
    yet it never really existed and this is yet another example of this.