In January 2015, Microsoft revealed HoloLens, an augmented reality headset aimed at blending the physical and digital worlds. The headset would have its own graphics processing unit, allowing the user to move freely instead of being tethered, and the demo video showed various uses from watching Netflix as if projected on a wall, to working on 3D product designs.

At events since, Microsoft’s shown off live demos, like one where the user can play with the popular game Minecraft, and released a few important details, like a $3,000 price tag for the developer kit, as well as partnerships with companies like Lowe’s.

So far, it’s a limited number of people who have access to HoloLens, and as a result of that, as well as demos that have gone well in the public eye, one of the words most commonly associated with HoloLens (and augmented reality) is potential.

On a broad level, Altimeter analyst Brian Solis sees some of that potential as being “taking what you know and doing it better.” So for example, the process of designing 3D models in 2D could be greatly improved with the ability to design 3D in 3D.

“This is where I think the real promise of VR and AR lies, in what I call experience design and experience architecture. You’re essentially building new capabilities, and you’re also building new worlds that wouldn’t have been possible otherwise,” Solis said.

At Microsoft’s Build conference this year, the company announced an updated SDK for HoloLens. Solis said that the SDK helps make the device future proof.

“It’s all in the hands of the developers’ community, to do things with them that are useful or meaningful or engaging or productive. Otherwise, it’s just another technology that struggles to find a future,” Solis said.

Despite the seemingly open horizon, there are some challenges that HoloLens could face. For one, Solis said that Microsoft isn’t necessarily known for being a company with the best community engagement and developer relations, and when AR is an industry that will survive or fail because depending on those things.

Gartner analyst Tuong H. Nguyen pointed out that Microsoft has struggled on the mobile side in the past, like with the Windows Phone. He said that PCs aren’t exactly an exploding market. For Microsoft as a company, once again the potential lies with the dawn of a brand new user interface. And whatsmore, it’s a horizontal application, not vertical, which means that if someone has the idea and the means, they could theoretically cook up a use for HoloLens. Microsoft is positioning itself for the future.

Though Nguyen said it feels too early to be able to just put a device out there that easily suits everyone’s need whether they be education, or oil and gas.

It’s also difficult to see where the market is going. This past week, WIRED gave us a glimpse of Magic Leap, which will apparently be an augmented reality headset. Magic Leap has been incredibly secretive, yet still raised $793.5 million in a funding round in February 2016. The video released showed, for one, an office with heads-up displays for things like messages.

Another competitor could be Meta, an augmented reality headset that claims a neuroscience-driven interface.

“I don’t think there is an absolute way to segment the market at the moment. One, because things are changing so fast, but two, the market’s also very new,” Nguyen said.