That's like saying it costs a billion dollars to develop a drug, so there's a big barrier to entry. Making the first pill (or Magic Leap) might cost $1B, but the second will only cost a couple hundred bucks. That's why there's a patent system.
You can just wait until the demand has been proven, and then jump in. That's what's happened to GoPro and to most PC/smartphone OEMs, and it's what happens to pharma companies when their drugs go off patent.
I don't think the money to be made in VR/AR will come from making the headsets themselves, but from providing some sort of software with lock-in. If Magic Leap has that, then they could become the Apple of AR, but so far it looks like they're just developing fancy hardware that the Chinese will quickly clone.
The Chinese "knock off" people have trouble making an equivalently good iPhone. A scanning fiber array based virtual retinal display can't be quickly cloned.
They've been building their own fabrication facilities in Ft. Lauderdale, they are trying their best to keep the chinese factories from stealing their IP.
The Chinese knockoffs (and Google, for that matter) have trouble making equivalently good software (iOS). It's a challenge in software development and hardware-software integration, not hardware development.
