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The augmented reality (AR) and virtual reality (VR) market generated revenue of $6.2 billion in 2017, and it is projected to progress at a CAGR of 58.1% during 2018–2023. The soaring demand for AR and VR in the retail and e-commerce sector, increasing penetration of smartphones and tablet computers, and rising demand for gesture and haptic control are the key factors driving the growth of the market across the globe.
Among all regions, Asia-Pacific (APAC) is expected to witness the fastest growth in the AR and VR market during the forecast period. The rise in the economic growth rate, increase in the adoption of technologically advanced solutions, surge in the penetration of smartphones in emerging economies, such as China and India, and growth in the application of the technologies in the end-use industries are some key factors propelling the market in the region.
Factors Governing AR and VR Market
The growing focus of businesses on the aesthetics of AR and VR devices is a key trend being observed in the AR and VR market. AR and VR devices, such as smart glasses, heads-up displays (HUD), and head-mounted displays (HMD), offer a high degree of flexibility and mobility to users. The application areas of AR and VR are numerous, and companies are exploring ways to integrate these technologies in different fields. Furthermore, the organizations operating in the market are increasingly focusing on the aesthetics of these devices, in order to make them voguish, to raise their adoption in different applications.
The rising demand for gesture and haptic control is supporting the growth of the AR and VR market, worldwide. The haptic technology is used to create the sense of touch that users feel in the form of applied forces, motion, or vibrations, whereas gesture recognition algorithms let users control the devices and applications by using their gestures, typically hand movements. With these technologies, the user can touch a virtual object, as if in the real world. The rising popularity of these technologies has thus added a new dimension to such devices, thereby driving their adoption.
In the coming years, mixed reality is expected to offer ample growth opportunities to VR and AR market players, as it will facilitate the virtual placement of 3D replicas of objects in the real environment. Additionally, it offers enterprise solutions for completing tasks, by connecting different team members in a shared virtual world, thereby overlaying the real physical world. Therefore, the demand for mixed-reality devices is expected to increase significantly in the coming years, which would allow AR and VR equipment manufacturers and content developers to expand in domains that could not be explored earlier.
AR and VR Market Segmentation Analysis
The hardware category generated the higher revenue in the market in 2017, based on component. This is due to the increasing demand for high-performance AR devices, increasing application areas, and decreasing product costs.
The AR device category is expected to hold the larger share in the AR and VR market in by 2023, based on device type. AR-based HMDs are increasingly gaining popularity in applications such as tourism, automotive, military, gaming, and education. The massive adoption of mobile AR is further expected to support the dynamic growth of this market category.
The enterprise category is expected to witness the fastest growth in the AR market during the forecast period, based on application. Enterprises are already benefiting from AR in a number of ways, such as optimized productivity, enhanced learning outcomes, real-time data and analytics visualization, efficient warehousing and logistics, and better collaboration with remote workers.
Geographical Analysis of AR and VR Market
North America held the largest share in the global AR and VR market in 2017, primarily due to technological advancements, strong penetration of smartphones and internet, and early adoption of emerging technologies in the region. APAC is expected to witness the fastest growth in the market during the forecast period.
Competitive Landscape of AR and VR Market
The global AR and VR market is highly competitive, with the presence of a large number of market players. Among these, Himax Technologies Inc., Qualcomm Technologies Inc., Intel Corporation, Sony Corporation, Microsoft Corporation, Seiko Epson Corporation, Samsung Electronics Corporation Limited, Google LLC, PTC Inc., and Vuzix Corporation are the prominent ones.
Recent Strategic Developments of Major AR and VR Market Players
In recent years, the major players in the AR and VR market have taken several strategic measures. For instance, in October 2017, Samsung Electronics Corporation Limited, in partnership with Microsoft Corporation, launched the Samsung HMD Odyssey, to deliver a mixed-reality user experience. It features dual active-matrix organic light-emitting diode (AMOLED) displays, a 110⁰ field of view, headphones tuned by AKG (an Austrian acoustics company), built-in 6 degrees of freedom (DoF) inside-out position tracking as well as a 360⁰ spatial sound.
Market Size Breakdown by Segment
The augmented Reality (AR) and virtual Reality (VR) market report offers comprehensive market segmentation analysis along with market estimates for the period 2013–2023.
Based on Device Type
Based on Component
Based On Application
Key Questions Addressed/Answered in the Report