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AT&T Inks an Exclusive Deal With Secretive Startup Magic Leap

July 11, 2018, 1:41 PM UTC

The company that was first with the iPhone may be first with the next generation of mind-blowing consumer tech. AT&T said on Wednesday it will be the “exclusive” wireless distributor of upcoming products from Magic Leap, the secretive startup creating virtual and augmented reality goggles.

However, Magic Leap isn’t selling anything yet. The company has been showing off its “Creator Edition” product, a set of goggles and a portable, wearable computer to power them. The device is scheduled to ship to developers and designers this summer, Magic Leap says.

AT&T’s wireless exclusive may not be as extensive as its 2007 exclusive with Apple’s iPhone (AAPL). By saying it is the exclusive wireless distributor, it leaves open the possibility that other retailers outside of the wireless industry could also sell the Creator Edition, perhaps without cellular connectivity.

“We’re designing and offering the future of entertainment and connectivity, and this exclusive arrangement—in combination with our 5G leadership position—will open up new opportunities and experiences,” John Donovan, CEO of AT&T’s wireless side, said in a statement.

“We’ve joined with AT&T because we believe in a combined vision of expanding high-speed networks, edge computing, and deep integration with creative content,” Rony Abovitz, founder and CEO of Magic Leap, added.

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AT&T said it will start selling Magic Leap products “when available for consumers” starting in its stores in Atlanta, Boston, Chicago, Los Angeles, and San Francisco. Those are locations where the carrier has opened larger marquee stores, suitable for demonstrating new products like Magic Leap.

AT&T also made an investment into Magic Leap but didn’t further disclose details. Donovan got “observer rights” with the board of the startup, which has previously announced financial backing from Google (GOOGL), Alibaba (BABA), J.P. Morgan Chase (JPM), Fidelity Investments, and T. Rowe Price, among others.

The secretive startup has faced some skepticism about its products. But in December, the company showed off the “Creator Edition” for the first time, featuring goggles that imposed virtual, digitally created objects into real scenes and a palm-sized processor worn on a belt. Still, Magic Leap hasn’t announced pricing or a consumer release date for the product yet.

Likewise, AT&T (T) has faced some questions about the business case for the much faster wireless 5G network its building. One stated use for the new network is carrying the heavy data loads needed for portable VR and AR devices.

(Update: This story was updated July 11 after Magic Leap said when it would ship its first product to developers.)