Microsoft Goggles’ Cost Must Drop From $80,000 Each, Army Says

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(Bloomberg) -- The cost of Microsoft Corp.’s goggles for the US Army should “be substantially less than” than the projected $80,000 per set if they’re to generate large orders in the future, the service said. The goggles, known as the Integrated Visual Augmentation System, or IVAS, are intended to give soldiers everything from night-vision capability to warnings of incoming airborne threats. Unless the high cost forces a change to the Army’s plan, Microsoft could receive as much as $21.9 billion over a decade for the devices, spares and support services if all options are exercised. Bush didn’t offer specific cost figures, but the Army acknowledged after a Bloomberg News inquiry that its pricing goal “is it be substantially less than $80,000.” The basic heads-up display, battery and chest unit for displaying information — such as the location of overhead drones — counts toward $41,824 of the current unit price estimate, according to budget documents.The remainder includes increased expenditures, from Army program management to Microsoft engineering and software support costs. Bush said the service is working on the issue “with our industry partners.” “We are going through the program to identify where we can reduce costs,” Robin Seiler, Microsoft’s corporate vice president for Mixed Reality, told reporters this week.

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