Google (News - Alert) Glass, the $1,500 wearable computing eyewear that has been the butt of many a “Glasshole” joke, is being retired this week. But Google is planning on using the intellectual property from the project to create a new division that will work on the next iteration of intuitive wearables and augmented reality. That’s a timely move considering big announcements on that front from Magic Leap and Microsoft (News - Alert).

For its part, its Windows Holographic announcement this week looks to lay down the gauntlet for startups and Google alike.

Google Glass is Dead; Long Live Google Glass

Google Glass in its original iteration offered Google search and smartphone-like functionality via on-lens information presentation—so information about what one was looking at would appear literally before one’s very eyes.

Mat Honan, in his essay for Wired entitled, “I, Glasshole: My Year with Google Glass,” explained it thusly:

“Glass has a slew of features that made my case: hands-free Internet, voice recognition, and a camera that makes snapping pictures an automatic action,” he explained. “Touch it at the temple and you take a photo. Hold the button a second longer and you’re shooting video. Bark a few commands, and you can send that photo or video to anyone. Even better, you can share what you are seeing, live, with other people in real time.”

If that sounds like something out of a sci-fi movie, it’s because in many ways, it was. It was also controversial, particularly when it came to the potential for incorporating facial recognition capability. A Glass wearer could, in theory, look at any random person on the street and bring up all available information about them, in seconds.

So, Google has some work to do. And it knows it: "Glass was in its infancy, and you took those very first steps and taught us how to walk," Google said in a post on the Google+ social network. "Well, we still have some work to do, but now we're ready to put on our big kid shoes and learn how to run."

So, Glass will move out of the Google X technology incubator and into a full-fledged, purpose-driven unit headed up by Tony Fadell, co-founder of Nest.

"As we look to the road ahead, we realize that we've outgrown the lab and so we're officially graduating from Google X to be our own team," Google said. "We're thrilled to be moving even more from concept to reality."

All of that said, a Forrester (News - Alert) study recently found that 43 percent of consumers said that they were interested in face computing like Glass, so at least one analyst sees a lot of upside.

"Google Glass hasn't truly been released as a product yet. It's been in long-term beta for over two years," said Forrester analyst JP Gownder. "This organizational move will help to clarify the go-to-market strategy for both consumer and for enterprise customers."

Given the explosion in wearables, it’s likely that Glass as originally conceived can now dovetail with more modern thinking. One of those intersections could come through partnerships with companies like Magic Leap, which describes itself as providing “cinematic reality” using 3D augmented reality (AR).

The Next-Gen of AR

Magic Leap CEO Rony Abovitz says that his company is working on “what we believe will be the most natural and human-friendly wearable computing interface in the world.”

Magic Leap is talking about reinventing the space entirely. After raising $542 million in a round of financing led by Google, the company has begun filing patents for glasses (as opposed to headsets) that will contribute to a crowd-sourced map of things around the user, gleaned from images and comments created by other Magic Leap users.

And it’s not just that. Other whiz-bang features in the patent applications include things like the ability to project fiber-optic from the glasses, which can then be manipulated through a virtual interface using hand gestures. You may remember a similar functionality from the very fictional Mission Impossible III.

Further, this can be done so that what’s seen and manipulated is actually projected out onto the space in front of a user or onto the floor, or viewable only if you’re wearing the glasses. Other interface items like a haptic glove are included in the ideas submitted as well.

“Those are old terms — virtual reality, augmented reality. They have legacy behind them. They are associated with things that didn’t necessarily deliver on a promise or live up to expectations,” Abovitz said. “We have the term ‘cinematic reality’ because we are disassociated with those things…When you see this, you will see that this is computing for the next 30 or 40 years. To go farther and deeper than we’re going, you would be changing what it means to be human.”

Windows Holographic

But Magic Leap isn’t alone in questing after this space of course.  Microsoft this week in a case of curious timing revealed Windows Holographic, which takes real-world video and overlays holographic images for an AR experience that is accessible via a wearable headset device.

Imagine the use cases: when you buy something from IKEA let’s say, that confusing jumble of Nordic drawings can become much more instructive when you’re able to view them in 3D, and manipulate them from all angles. And aside from furniture assembly types, architects, CAD operators and others in the design field are obvious first targets for this.

Gaming is a big one too. Users can transform one's living room into a "surreal gaming environment," which has big ramifications not only for war games and sandbox play but also things like Minecraft—and incidentally, Microsoft said that it’s working on holographic Minecraft as we speak.

"In software, nothing is impossible," said Alex Kipman, the Microsoft developers that helped spearhead the project. "At best, things are improbable. And with a little bit of luck and a lot of pixie dust, the improbable becomes possible...from the little screens to the big screens to no screens at all."

Windows Holographic will have built-in support in Windows 10 via APIs, as a boon for developers, and the apps can be supported with a new headset, dubbed Microsoft HoloLens. But, it said it would support third parties’ headsets too, like Motion Leap and Oculus Rift.

Microsoft also showed off HoloStudio, a 3D modeling tool for building holograms to be integrated into software, or even 3D printed.