The HoloLens hardware, which Microsoft claims requires no phone or computer connection to use, looks amazing. You can walk around virtual objects freely, without the use of hardware in a fixed position for positional tracking. You use your hands to interact with the world, even though gesture-based hardware is often finicky at best.
In short, the video leaves many technical questions unanswered, and assumes a number of huge breakthroughs in augmented reality.
This is the promotional video for the technology, if you have yet to see it:
The use cases are multiple, and many of them are amazing. Imagine non-destructive editing as you're surrounded by as many virtual screens as you need. Creating objects with virtual lathes and then creating them with a 3D printer. Rapid prototyping by combining physical objects with virtual ones. Gaming that takes over your living room completely. The technology, if it can do what is show in the video, may change the way we interact with virtual objects.
The problem is that Microsoft has only shown that hardware in a controlled environment, and we have to keep in mind the difference between these first displays of the technology and the reality of what is actually shipped. The best way to show that difference? Let's take a look at Microsoft's own history.
This is the announcement video of Project Natal, the hardware that would later be renamed the Kinect.
That hardware, as shown, never really existed. In practice it had trouble tracking multiple people. It often lost track of your body, and voice commands were often hit and miss. The Kinect's long journey, and Microsoft's attempts to turn it into a mainstream product, came to an end when it was removed as a mandatory pack-in with the Xbox One hardware.
The Kinect technology is now an interesting memory and, while some people still use in their home, there are precious few games for the device and performance remains hit or miss. Heck, according to the in-depth Wired piece this is a branch off the Kinect tech-tree anyway.
We're not saying the HoloLens is just smoke and mirrors, it's just worth taking a step back and realizing that what they're showing right now is a huge leap from any technology that has existed before. How the hardware will eventually work in our homes, and at what price, are still open questions. Also, heck, it could be smoke and mirrors.
The video and demos we've seen are Microsoft's best-case scenarios, and that can often be a very long way from real life.