Apple has hundreds of engineers working on its "next big thing."
Future Apple products will include a technology called augmented reality, which overlays computer graphics and information from the internet into the real world. Apple CEO Tim Cook has said the majority of people will soon have AR experiences daily.
Apple's goal for this technology is to make a pair of smartglasses, but in the short term, the first fruits of the effort will bring AR features to the iPhone, Bloomberg reported on Monday.
Some of Apple's AR team are working on Apple's iPhone camera team. According to the report, features that possibly could show up in an upcoming version of the iPhone include:
One of the features Apple is exploring is the ability to take a picture and then change the depth of the photograph or the depth of specific objects in the picture later; another would isolate an object in the image, such as a person's head, and allow it to be tilted 180 degrees. A different feature in development would use augmented reality to place virtual effects and objects on a person, much the way Snapchat works.
In the past few years, Apple has purchased several AR startups, including FlyBy Media and Metaio. Engineers from those companies are now working in a special projects camera group, Business Insider previously reported.
But Apple also has an AR-specific team led by Mike Rockwell, a former Dolby executive, which includes respected Apple veterans including Fletcher Rothkopf, who helped design the Apple Watch and who is named on several of Apple's most inventive patents.
In the long term, Apple is planning to create a pair of smartglasses. The challenges Apple faces include battery life, making them stylish and wearable for long periods of time, and possibly developing a new operating system and chip for the glasses.
Apple will also need to invest in 3D animation to provide solid content for the wearable platform.
The glasses are likely to be wirelessly "tethered" to an iPhone, which will handle processing, like the Apple Watch. Previous rumors have suggested that the glasses could launch as early as 2018.
Apple CEO Tim Cook's public comments from last fall suggest that Apple Glass may be a while. "AR is going to take a while, because there are some really hard technology challenges there," Cook said.