Augmented Reality and Virtual Reality Are on the VRge of Growth, Says IDC
June 19 2018 - 8:30AM
Business Wire
Worldwide shipments of augmented reality (AR) and virtual
reality (VR) headsets were down 30.5% year over year, totaling 1.2
million units in the first quarter of 2018 (1Q18), according to the
International Data Corporation (IDC) Worldwide Quarterly Augmented
and Virtual Reality Headset Tracker. Much of the decline occurred
due to the unbundling of screenless VR headsets during the quarter.
For much of 2017, vendors bundled these headsets free with the
purchase of a high-end smartphone, but that practice largely came
to an end by the start of 2018. Despite a poor start to 2018, IDC
anticipates the overall market will return to growth over the
remainder of the year as more vendors target the commercial AR and
VR markets and low-cost standalone VR headsets such as the Oculus
Go make their way into stores. IDC forecasts the overall AR and VR
headset market to grow to 8.9 million units in 2018, up 6% from the
prior year. That growth will continue throughout the forecast
period, reaching 65.9 million units by 2022.
"On the VR front, devices such as the Oculus Go seem promising
not because Facebook has solved all the issues surrounding VR, but
rather because they are helping to set customer expectations for VR
headsets in the future," said Jitesh Ubrani senior research analyst
for IDC Mobile Device Trackers. “Looking ahead, consumers can
expect easier-to-use devices at lower price points. Combine that
with a growing lineup of content from game makers, Hollywood
studios, and even vocational training institutions, and we see a
brighter future for the adoption of virtual reality."
When it comes to augmented reality headsets, many consumers have
already had a taste of the technology through screenless viewers
such as the Star Wars: Jedi Challenges product from Lenovo. IDC
anticipates these types of headsets will lead the market in
shipment volumes in the near term. However, non-smartphone-based AR
headsets should begin to see greater market availability by 2019 as
commercial uptake continues to rise and existing brands launch
next-generation products. IDC predicts triple-digit growth in this
space between 2019 and 2021.
"Momentum around augmented reality continues to grow as more
companies enter the space and begin the work necessary to create
the software and services that will drive AR hardware," said Tom
Mainelli, program vice president, Devices and Augmented and Virtual
Reality at IDC. "Industry watchers are eager to see new headsets
ship from the likes of Magic Leap, Microsoft, and others. But for
those devices to fulfill their promise we need developers creating
the next-generation of applications that will drive new experiences
on both the consumer and commercial sides of the market."
Category Highlights
Many consumers' first experience with an Augmented
Reality headset will be in the form of a screenless viewer.
While large movie properties such as Star Wars helped move
significant volumes of these headsets the past holiday season,
uptake for the remainder of the year is likely to slow as the
headsets have limited functionality beyond their core applications.
In the latter years of the forecast, IDC expects such products to
decline in relevance, although they are likely to remain in the
market, often sold as toys. Meanwhile, standalone AR head-mounted
displays (HMDs) should grow to reach 194,000 units in 2018 and will
experience a compound annual growth rate (CAGR) of 190.9% over the
five year forecast. More advanced headsets such as Microsoft's
Hololens and Magic Leap's One will help drive adoption in the
commercial and consumer markets. Finally, tethered headsets will
grow with a five-year CAGR of 241.8%. This last category will be
the eventual home of products with lower-cost headsets based on
Apple's ARKit and Google's ARCore that tether to smartphones or
tablets.
IDC forecasts Virtual Reality headsets to grow from 8.1
million in 2018 to 39.2 million by the end of 2022, representing a
five-year CAGR of 48.1%. While many think of VR as a consumer
technology, IDC believes the commercial market to be equally
important and predicts it will grow from 24% of VR headset
shipments in 2018 to 44.6% by 2022. From a platform perspective,
the market has been dominated by Oculus largely due to the initial
volumes around Samsung's Gear VR. This will likely continue in the
near term as the Go brings VR to more consumers. However, the
Oculus platform is likely to face pressure from both HTC's VIve
platform and Microsoft's Windows Mixed Reality platform. The latter
should see strong opportunities in the commercial market as brands
such as HP, Dell, and Lenovo bring their years of experience
catering to enterprise buyers to the market.
AR/VR Headset Market Share by Form Factor, 2018 –
2022 Technology Form Factor
2018* 2022* Augmented Reality
Screenless Viewer 5.0%
1.0% Standalone HMD 2.2%
21.1% Tethered HMD 1.0%
18.4% Virtual Reality Screenless Viewer
34.5% 4.6%
Standalone HMD 14.8% 33.0%
Tethered HMD 42.5% 21.8%
Total 100.0%
100.0% Source: IDC Worldwide Quarterly AR and
VR Headset Tracker, June 19, 2018
* Note: Market share for 2018 and 2022 are forecast
projections.
In addition to the table above, a graphic illustrating worldwide
shipments for AR and VR headsets over the 2018-2022 forecast period
is available by viewing this press release on IDC.com.
About IDC TrackersIDC Tracker products provide accurate
and timely market size, vendor share, and forecasts for hundreds of
technology markets from more than 100 countries around the globe.
Using proprietary tools and research processes, IDC's Trackers are
updated on a semiannual, quarterly, and monthly basis. Tracker
results are delivered to clients in user-friendly excel
deliverables and on-line query tools.
For more information about IDC's Worldwide Quarterly Mobile
Phone Tracker, please contact Kathy Nagamine at 650-350-6423 or
knagamine@idc.com.
About IDCInternational Data Corporation (IDC) is the
premier global provider of market intelligence, advisory services,
and events for the information technology, telecommunications, and
consumer technology markets. With more than 1,100 analysts
worldwide, IDC offers global, regional, and local expertise on
technology and industry opportunities and trends in over 110
countries. IDC's analysis and insight helps IT professionals,
business executives, and the investment community to make
fact-based technology decisions and to achieve their key business
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version on businesswire.com: https://www.businesswire.com/news/home/20180619005216/en/
IDCTom Mainelli, 925-209-3961tmainelli@idc.comorJitesh Ubrani,
416-873-0315jubrani@idc.comorMichael Shirer,
508-935-4200press@idc.com