Metaverse Market Size & Share Analysis - Trends, Drivers, Competitive Landscape, and Forecasts (2024 - 2030)

Metaverse Market Data

Metaverse Market Analysis

The global metaverse market generated revenue of USD 90.6 billion in 2023, and it is projected to reach USD 1,157.8 billion by 2030, growing at a CAGR of 44.0% during the forecast period. The growing focus on integrating the physical and virtual worlds, rising adoption of advanced VR devices, and accelerating demand for XR devices are the major factors driving the growth of the market.

North America holds the largest share in the metaverse market due to the presence of significant metaverse technology providers, such as Meta Platforms Inc. and Roblox Corporation. Moreover, the rising expenditure on digital solutions, coupled with the rapid establishment of metaverse platforms and their growing usage, supports the market growth.

Several industries are adopting these environments, such as healthcare, aerospace and defense, education, and retail. Moreover, is attracting several social network leaders and online game makers to take strides in this space. The growing demand for virtual events, increasing number of visitors, and rising consumer spending on virtual concerts aid the market growth.

Virtual platforms, such as Minecraft, The Sandbox, Roblox, Fortnite Creative Mode, and Hyperverse, are gaining traction. Further, the proliferating smartphone penetration and growing count of app developers are projected to boost the market growth in the long run. During the forecast period, the metaverse market is also expected to grow because of the increasing funding in AI-based startups by various key players in India and China.

Several companies are engaging in partnerships, product launches, and mergers & acquisitions in order to gain a competitive advantage. For instance, in March 2022, Alibaba Cloud launched its first VR-based rehabilitation training software for specific phobias, such as acrophobia. Another example of such collaborations is the one announced by The Sandbox and Warner Music Group in January 2022 to combine a musical theme park and concert venue, to offer concerts and musical experiences.

Metaverse Market Trends & Drivers

Recent Trends

Implementation of 3D Digital Twin Technology

• The use of the 3D digital twin technology has significantly changed how businesses operate and how customers interact with, perceive, and assess the built environment. With the use of this technology, any room or structure can have an accurate 3D virtual representation. As a result, businesses will have the power to duplicate physical locations precisely and use them as separate entities.
• The digital twin technology enables users to virtually try on clothes and browse new stores before they even open. In this regard, a camera photographs the customer, and the embedded AR technology provides a realistic visual of the product over the actual image, to demonstrate how the product would look on the customer’s body. Using the virtual try-on technology, several fashion brands and businesses are focusing on blending the physical and virtual, to offer an experience that is convenient, safe, and efficient for customers, whether online or in-store.
• Along with the retail sector, revolutions are occurring in the fields of education, finance, healthcare, and a number of other sectors. With 3D digital twins, civil engineers can virtually tour areas, plan intrusive and difficult construction work from a distance, and expedite construction timetables.
• Furthermore, with the help of the metaverse and digital twins, the virtual world can become more realistic and offer real-life experiences.

Surging Adoption by Business Enterprises

• The technological evolution has been catalyzing growth for various global businesses. Earlier, only a few corporations were open to the transition to 100% digital operations. However, with the proliferating demand, things transformed rapidly, and companies were forced to shift to the digital world for better business.
• Companies have been moving to the work-from-home model, and numerous are currently implementing a hybrid approach. The next level in this hybrid approach entails helping people collaborate and work in VR. The metaverse helps in developing persistent VR workplace environments to encourage corridor chat, employee interaction, collaborative activities, and other essential corporate processes.
• For instance, in May 2022, Meta Platforms Inc. developed a 3D-avatar-based collaborative workplace, called Horizon Workrooms, a VR space for teams to connect, collaborate, and develop ideas together.
• Moving past workspaces, in the metaverse, companies have complete control over their own meta worlds and what precisely occurs there. From creating their individual dress codes to selling products inside the platform, companies can articulate their own small worlds there. For instance, a retailer owning a VR store can exhibit all the products on shelves. Customers can look at them, click to buy, and make payment, for them to be delivered to their house, which, in turn, improves customer experience and helps companies in achieving a huge customer base.

Growth Drivers

Increasing Demand for Metaverse in Entertainment and Gaming Industries

• Due to the surging use of AR, VR, and MR, the worldwide media, entertainment, and gaming industries have experienced rapid growth. The main driver for the adoption of these technologies is the increasing need for gadgets such as VR and MR headsets, HUDs, HMDs, smart glasses, and smart helmets. These systems provide a first-person perspective, act as natural user interfaces, offer 6-degree freedom, and provide other features to create virtual scenarios that look realistic, in order to improve the overall gaming experience.
• Leading market competitors have made considerable expenditures in response to the rising demand for XR gadgets, which is expected to accelerate the uptake of the metaverse in the gaming and entertainment sectors.

Rising Usage of Metaverse to Buy Digital Assets and Use Cryptocurrencies

• Metaverse allows for the creation of new online environments in which people interact across many dimensions and engage with digital content more meaningfully, rather than merely reading information. The metaverse’s currency is a cryptocurrency, and every metaverse has its collection of coins.
• Most virtual games and environments in the metaverse enable people to monetize their avatars, possessions, and operational equipment by selling them as non-fungible tokens (NFTs), NFTs of avatars and tweets are valued higher than several high-priced paintings.
• Because of the accessibility of cryptocurrencies on exchanges users can make money by selling NFTs and metaverse coins directly to each other. The user experience has improved as VR and AR headsets have become more affordable and powerful.
• They are used to pay for everything from virtual real estate to NFTs and avatar shoes. Cryptocurrencies are used to connect the physical and virtual worlds and allow users to ascertain digital assets worth and the returns they yield in the long run-in legal currency. The use of the metaverse to buy digital assets using cryptocurrency is gaining traction worldwide. Individuals now communicate digitally via websites, messaging apps, and social media platforms, including Facebook.
• Trading digital currencies and NFTs is now possible because of the blockchain technology. Tokens are helping creators monetize their work through new methods of transacting and owning digital products. Token holders can participate in the platforms’ governance, in addition to monetization and exchanging assets (e.g., vote on decisions). This democratic-ownership economy, when combined with the prospect of interoperability, has the potential to open up enormous economic opportunities, as digital goods and services are no longer bound by a single gaming platform or brand. Cryptocurrency has the ability to transform the way people socialize, interact with brands, watch performances, learn about new things, and trade digital assets.

Restraints

Ever-Present Threat of Cyberattacks

Even if the final iterations of these platforms differ from today’s vision, technologies such as VR, AR, IoT, and cryptocurrencies will be used. The increasing adoption of remote work practices among companies provides new opportunities to cybercriminals to attack businesses and individuals. Concerns about data security and privacy in the metaverse Risks to metaverse users are like those regular internet users, such as data hacking, phishing emails, and malware attacks.

Further, hackers use weaknesses in IoT, AR, VR, and digital money to conduct assaults on virtually all industries. If metaverse systems experience a failure in security and privacy, they are almost certain to have a rough start, and people might become apprehensive about their adoption.

High Installation and Maintenance Cost of Premium Metaverse Components

• Hardware for the metaverse consists of XR gadgets, semiconductor parts, sensors, trackers, and other cutting-edge tools. Fast networking, ample storage, and high-end technology are needed, which makes it costly to experience the metaverse in the most-realistic and captivating way possible.
• Engines, 3D modeling programs, and rendering tools for the enterprise-grade metaverse are costly. There are additional expenses associated with installing XR tools and solutions.

Market Segment Breakdown

Component Insights

• The hardware category holds the larger revenue share in the metaverse market.
• This is due to the rising popularity of AR and MR-based technologies. XR such as haptic sensors and devices, is also rising in popularity. Small, medium-sized, and large-scale businesses, as well as individual consumers, are increasing their spending on high-tech VR equipment, which is promoting the market expansion.

During the study, two components were studied:

• Hardware (Larger Category)
• Software (Fastest-Growing Category)

Platform Analysis

• The desktop category held the largest share, of around 50%, in the market in 2023.
• The expansion of the desktop category is being fueled by the expanding popularity of virtual desktops and PC gaming worldwide.

 Below are the major platforms on which metaverse can be deployed:

• Desktop (Largest Category)
• Mobile
• Console (Fastest-Growing Category)

Offering Insights

• The avatars category held the largest share of around 55% in the market in 2023.
• It is also expected to be the fastest-growing category, registering a CAGR of 44.5%, during the forecast period.
• The increasing of avatars for a variety of applications, including education, and gaming, drives this category.

During the study, we have come across four major offerings:

• Avatars (Largest & Fastest-Growing Category)
• Virtual Platforms
• Asset Marketplaces
• Financial Services

Market by Technology

• The VR category held the largest share, of around 45%, in the market in 2023. VR is used in many verticals, including entertainment, gaming, education, and healthcare. An increasing number of uses of VR technology are being found in these fields. Additionally implementing VR products for employee training offers advantages in the human resources domain.
• The AR category is expected to witness the highest CAGR, of 44.6%, during the forecast period. AR is being employed in wearable devices, for instance, smart glasses, which will necessitate a different type of UX and design process. A significant portion of AR growth in the gaming industry is due to its real-time customization capabilities.

Technology covered in the report include:

• Virtual Reality (VR) (Largest Category)
• Artificial Reality (AR) (Fastest-Growing Category)
• Mixed Reality (MR)

Market by Vertical

The gaming category held the largest share, of around 35%, in the market in 2023. The growing trend of VR games is helping increase the acceptability of 3D and smart glasses.

The education category is expected to be the fastest-growing category, registering a CAGR of 44.8%, during the forecast period. Users and programmers alike can customize educational platforms by building anything from a metaverse institution to virtual sporting grounds. A teacher can explain scientific discoveries to students, while also presenting them to them in an engaging 3D environment. Education professionals can construct virtual landscapes using their lesson plans.

Here the major verticals covered in the report:

• Gaming (Largest Category)
• Manufacturing
• Entertainment and Media
• Healthcare
• Education (Fastest-Growing Category)
• Retail
• Fashion
• Aerospace and Defense

Regional Insights

• Globally, North America is the largest market for metaverse solutions, contributing around 45% revenue share in 2023.
• This is due to the growing popularity of smart devices such as smartphones, the surging demand for AR/VR technologies, and the rising corporate and consumer spending on digital products and emerging technologies.
• APAC will witness the highest CAGR, of 44.7%, over this decade.
• This can be attributed to the increasing adoption of new and innovative technologies, high investments by various tech giants in the region, and rising demand of consumers for more-immersive experiences in the digital world.

The regions and countries analyzed for this report include:

• North America (Largest Regional Market)
  • U.S. (Larger and Faster-Growing Regional Market)
  • Canada
• Europe
  • U.K. (Largest and Fastest-Growing Regional Market)
  • Germany
  • France
  • Italy
  • Spain
  • Rest of Europe
• Asia-Pacific (APAC) (Fastest-Growing Regional Market)
  • China (Largest and Fastest-Growing Regional Market)
  • Japan
  • India
  • South Korea
  • Australia
  • Rest of APAC
• Latin America (LATAM)
  • Brazil (Largest and Fastest-Growing Country Market)
  • Mexico
  • Rest of LATAM
• Middle East and Africa (MEA)
  • Saudi Arabia (Largest and Fastest-Growing Country Market)
  • South Africa
  • U.A.E.
  • Rest of MEA

Competitive Analysis

Market players are investing in research and development to upgrade their products, by advancing their technology upgrades. Another key strategy being pursued by the players is mergers and collaborations to enhance their portfolios and customer reach. For instance, in October 2022, Meta Platforms Inc. introduced Quest Pro, a VR headgear equipped with facial emotion sensors. Similarly, Nvidia is collaborating with Adobe and Blender to develop a collaboration and simulation platform, called Nvidia Omniverse.

Metaverse Industry News

• Meta is set to unveil a higher-resolution headset known as the Quest 3. This advanced device will provide users with immersive VR and MR experiences, incorporating "pancake optics" to enhance visual quality. Moreover, the headset will be equipped with a next-generation chipset, collaboratively developed with Qualcomm Technologies, aimed at delivering smoother graphics for an enhanced overall user experience.
• In July 2022, Activision Blizzard Inc.’s division Blizzard Entertainment acquired Boston-based studio Proletariat, to better serve players in the multiplayer online role-playing game World of Warcraft.
• In January 2022, HP Inc. collaborated with Varjo to upscale the availability of VR and MR products. The partnership allowed Varjo to certify several of HP Development Company L.P.’s Z workstations, such as HP Z4 G4 and Z8 G4, for use with Varjo’s products, such as VR-3.
• In April 2020, Vuzix Corporation signed a contract with the University of Louisville School of Medicine for the pilot usage of the Vuzix M400 smart glasses for emergency response, medical education and training, and care of patients in nursing homes.