Augmented Reality And Virtual Reality Market Value To Reach USD 60.69 Bn In 2023

Published Date : 11 May 2023

The global augmented reality and virtual reality market value to reach USD 60.69 billion in 2023 and is projected to touch around USD 859.35 billion by 2030, growing at a CAGR of 46.03% from 2022 to 2030.

The emergence of affordable VR headsets, the growing demand from smartphone users for augmented reality and virtual reality gear, and marketing campaigns by smartphone manufacturers have all benefited the worldwide AR and VR market.

Market Overview:

Virtual reality (VR) is an experience created digitally that replicates a three-dimensional setting in the real world. With VR accessories like gloves, headsets or glasses, and bodysuits, the technology offers viewers an immersive experience. The ability for users to fully immerse themselves in a highly simulated environment has changed the gaming and entertainment industries.

The development of 4G and high-speed data transmission has turned into major forces behind the uptake of AR and VR. The global AR and VR industry has been supported by rising smartphone user demand for augmented reality and virtual reality gear, the introduction of affordable VR headsets, and marketing initiatives by smartphone makers.

This study on the market for augmented reality and virtual reality games offers a thorough examination of the AR and VR gaming industries. By instantly integrating digital information, such as music, video, and data, into the real-world environment, the augmented reality and virtual reality gaming industries are now aiming to provide players with an immersive gaming experience. According to types, devices, and other factors, the report segments AR and VR.

Regional Snapshot:

With a revenue share of about 45.36% in Asia Pacific in 2022, this region benefited most from advances in VR technology. China, a prominent distributor of HMDs and other VR-related hardware, saw a considerable increase in the VR market. With this new technology, China is unquestionably leading the way in advancement. The drive to assume the role of a world leader is also to blame for this. Although China surpassed the U.S. in VR/AR revenue last year, predictions suggest China may do so shortly. By 2022, China may own more than $1 of every $5 invested in these technologies, according to research by Digi-Capital.

The market increase in North America is primarily the result of rising market revenues in the U.S. Many individuals are utilizing XR experiences to take the place of in-person ones now that the epidemic has made it necessary for them to work, socialize, learn, and buy from home. Even if supply chain and distribution problems briefly halted the shipment of VR hardware in H2 2020, more people will consume all forms of XR content during the forecast period due to increased demand. In order to account for faster-than-anticipated growth in both VR and AR users, we increased our earlier projections for this year. Interest in both technologies has been sparked by pandemic-related diseases, and developers are gearing up to accommodate the growing demand.

With a CAGR of 20.57% during the anticipated period, Europe is anticipated to become the regional market with the quickest growth. This is a result of the extensive use of VR technology across a range of industry sectors, particularly in the gaming and automotive sectors. The greater number of gamers in Europe contributes to the region's rapid uptake of cutting-edge VR gear. The expansion of the regional market has been hastened by the quick development and adoption of potent VR hardware targeted at the gaming community in European nations.

Augmented Reality And Virtual Reality Market Report Scope:

Report Coverage Details
Market Revenue in 2023 USD 60.69 Billion
Projected Forecast Revenue in 2030 USD 859.35 Billion
Growth Rate from 2022 to 2030 CAGR of 46.03%
Largest Market North America
Base Year 2022
Forecast Period 2022 to 2030
Regions Covered North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa

Market Dynamics:

Market Drivers: A growing number of retail and online businesses are requesting augmented reality services.

Both online and offline, the retail sector is undergoing significant transformation, and both present several potentials for XR technology innovation. Virtual reality (VR) technologies may be utilized in online retail to produce more immersive and engaging shopping experiences that mirror the "hands-on" benefits of brick and mortar stores. While this is going on, AR technology can be used in physical stores to help customers find the items they're looking for on the shelves and offer the same kinds of information and feedback opportunities (such as integrating customer reviews with in-store products) that customers have come to expect from online retailers.

Market Restraints: Concerns about health brought on by prolonged AR use

AR-related health risks among gamers are on the rise as new gaming hardware and software become available. As a result of the user's intense immersion in AR games for extended periods of time and their high level of interactivity, problems including anxiety, eye strain, weight, and lack of attention can arise. Because AR technology is immersive, prolonged use of the AR headset may result in feelings of stress or worry. In addition to stress, AR gadgets subject users to risky electromagnetic frequency radiation, which can lead to disease. On mice, scientists from the National Toxicology Program (NTP), an interagency federal program run by the National Health Institutes (US), conducted experiments. According to the results of this study, people who are exposed to electromagnetic radiation may be more susceptible to developing cancer.

Market Opportunities: Enterprise applications present opportunities

Enterprise applications offer a plethora of opportunities. Large-scale expenditures from businesses in smart manufacturing will be a key factor in the enterprise sector's growth in the AR market. Businesses with plants in many locations can adopt AR and hire a few engineers to handle a big setup. Effective management of businesses would be aided by remote cooperation using AR technologies to control machinery and other installations.

The educational usage of enterprise AR for technicians and other staff is one of its other significant applications. For instance, Unilever, a large maker of consumer goods, estimated that the retirement of the company's aging employees would cause it to lose roughly 330 years of domain experience in one of its European plants.

Device Insights:

With a predicted market share of around 65.01% from 2023 to 2032, the head-mounted display (HMD) device sector had the highest revenue share in 2022. Virtual reality headsets are becoming increasingly important in both consumer and business applications, which is driving market demand. Due to the variety and adaptability of HMDs, including hybrid, tethered, and self-contained HMDs, the segment is growing. These tools are employed in a variety of industries, such as the military, aerospace, engineering, research, and medicine, to give training, and they use interactive virtual images to explain a wide range of use cases.

The category for gesture-tracking devices (GTDs) is anticipated to grow at the quickest rate during the forecast period, at a CAGR of 20.36%. The demand for visual gesture recognition, a novel and quickly developing technology that enables more immersive and natural human-computer interaction, has significantly changed as a result of this growth, which can be attributed to the demand for visual gesture recognition moving from standard gesture tracking to visual gesture tracking. The various forms of GTD VR gear include sensors, processors, VR projectors, big-screen displays, and multiple projection systems.

Technology Insights:

With a proportion of revenue of approximately 83.48% in 2022, the semi- and fully-immersive categories accounted for the most. Over the forecast period, it is also anticipated to record the greatest CAGR. The continual increase in demand for VR HMDs can be blamed for segment growth. Using semi- and fully-immersive technology, real-world surroundings are replicated in a digital setting. High-definition monitors, intricate simulators, and powerful PCs are needed. With the use of VR technology, students can practice cognitive and motor tasks that are not possible in a classroom or therapeutic environment. Construction, aviation, entertainment, and the automobile industries are just a few of the sectors of the economy to use semi- and fully immersive technology.

Instead of immersing viewers in a virtual world, non-immersive technology offers a computer-generated or digital environment. In terms of network administration, this technology is regarded to be more effective and is more extensively used.

Component Insights:

About 70% of the market's revenue in 2022 came from the hardware category, which is expected to continue to rule the market during the forecast period. It is projected that the fast uptake of VR headsets in business settings, theme parks, and other locations would present growth prospects for original equipment manufacturers (OEMs).

Over the projected period, the software segment is anticipated to have the highest CAGR, at 23.0%. Unity offers specific resources for realizing your immersive vision. The industry-leading platform for software development combines tools made especially for augmented reality programmers with a unified workflow across devices that liberates creative thinking.

Application Insights:

Commercial sales represented the biggest revenue share of over 55.89% in 2022, and it is predicted that this sector would continue to rule the market during the projected period. VR businesses have tremendous growth possibilities as a result of the growing use of VR headsets in the commercial sector, especially in industries like real estate, auto showrooms, and retail stores. The commercial sector is now heavily utilizing VR technology as a result of the increased smartphone usage rate. The public is being introduced to new products by several firms via VR. Because of the wide range of opportunities for VR in the healthcare industry, including disease awareness, medical marketing, and medical learning & training, the healthcare category is predicted to grow at the highest CAGR of 25.47% throughout the projected period.

Recent Development:

  • In January 2022, HTC introduced a wrist tracker for the Vive Focus 3. Through the use of infrared LEDs that are optically detected by the wearable device's camera sensors, it assists in tracking. Even when the tracker is obscured from the camera's view, tracker movements and trajectories can be tracked using high-frequency IMU data and an advanced kinetic model.
  • In December 2021, By developing AR smart glasses, which users can use to access more information, animation, videos, and more lifelike experiences by superimposing digital or computer-generated content over their actual surroundings, Google announced and added a brand-new addition to its collection of augmented reality (AR) devices.

Major Key Players:

  • Microsoft
  • Google LLC
  • Apple, Inc.
  • Sony Corporation
  • Blippar Limited
  • Infinity Augmented Reality Limited
  • Niantic, Inc.
  • Zappar Limited.
  • Magic Leap, Incorporated
  • Wikitude GmbH

Market Segmentation:

By Device Type

  • AR technology
  • Head Mounted Displays
  • Head Up Displays
  • VR Technology
  • Head Mounted Displays
  • Gesture Control Device
  • Projector and Display Wall

By Offering Type

  • Hardware
  • Software

By End Use

  • Aerospace & Defense
  • Consumer
  • Commercial
  • Enterprise
  • Gaming and Entertainment
  • Healthcare
  • Others

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