Microsoft Corporation (NASDAQ:MSFT) dismissed the head of its HoloLens division following multiple allegations of misconduct, putting the tech giant's augmented-reality project in jeopardy.
Alex Kipman, who worked for Microsoft in Washington since 2001, was accused by current and former workers of inappropriate behaviour toward female employees, according to reports on wire services including Bloomberg.
A key member of the teams that developed Microsoft's HoloLens augmented reality headset and Kinect motion controller for Xbox, Kipman was one of Microsoft's top technical experts.
His departure is a sensitive moment for the HoloLens initiative because Microsoft is currently deciding whether to continue developing its own augmented reality hardware.
Consultancy firm Gartner says by 2035, the digital human economy will become a US$125bn market.
Panos Panay, who runs Microsoft's Surface division, will now take charge of HoloLens hardware, while Jeff Teper, vice president, will head up the software side.
HoloLens was expected to score big with the US Army, which ordered 120,000 IVAS headsets for soldiers.
It would be worth US$21.88bn to the company over 10 years, but the Army has delayed the deal, and a Pentagon audit was reportedly not too enthusiastic about the idea.
Microsoft may have to re-evaluate whether to keep making HoloLens hardware if the Army deal does not materialise, though the tech major already has an agreement with Samsung Electronics Co Ltd (ADR) (LSE:BC94) that could allow Samsung to make hardware for Microsoft's corporate customers.