In 2020, augmented and virtual reality revenues will soar to $162 billion; that’s the forecast from analysts peering into their crystal balls at IDC who believe the sector will experience a growth rate over 180% between 2015 and 2020. Combined with the huge surge in developer interest in VR we’ve experienced here at Skillsearch, it adds further credence to the belief that both VR and AR are set to make a major impact in spite of past predictions that have been more cautionary in tone.
IDC’s forecasts are the kind that everyone invested in the technology has been hoping for, whether you’re Oculus, Sony, HTC and now Apple (who has patented a wireless VR headset and bought AR company Metaio last year) or simply a developer aiming to be part of a wave of tech that will transform gaming. The icing on the cake is perhaps IDC’s findings that reveal only $5.2 billion in revenues has been earmarked for this year, meaning there’s room for staggering growth over the next four.
Money for Something…..
But where is all this revenue going to pour in from? VR and AR hardware itself is expected to generate over half of the predicted revenues during the next two years. While headset sales have slowed for PC-based rigs, pundits believe that real growth will come from more affordable solutions such as PlayStation VR (with its graphical fidelity boosted further by the PlayStation 4 Pro) and most critically, via mobile with systems such as Google’s Daydream VR platform due this year.
It’s these relatively inexpensive platforms that are expected to snare the imaginations and wallets of mainstream/casual users – and perhaps most critically, the attention of businesses looking for inexpensive VR/AR solutions to introduce into the enterprise sector. While software including VR games and paid content are of course predicted to be big revenue generators, it’s ultimately enterprise where the big bucks will be generated; according to IDC, while VR/AR software revenues will rapidly grow year over year in 2016 – by over 200% – this will be superseded by services revenues as demand for enterprise-class support takes off.
The Hare and the Tortoise…..
As we draw closer to 2020, industry is expected to heavily invest in the technology because of its potential applications in corporate and public life from healthcare and manufacturing through to education and logistics. Leading this charge, IDC believes, will be AR, the technology set to overtake VR eventually because its core suite of strengths are better suited to the demands of the sector. This belief in AR’s eventual dominance was also echoed by Apple’s CEO Tim Cook recently but for more generalised reasons: “Augmented reality is the larger of the two, probably by far,” Cook stated on Good Morning America, “because [it] gives the capability for both of us to sit and be very present talking to each other, but also have other things visually for both of us to see”.
Ultimately, whether you’re working on industrial AR solutions or innovating in the VR gaming space, a picture is emerging of a market ripe with opportunity. The real question is where you want to position yourself within this rapidly expanding marketplace to ensure that you are there to reap the rewards by 2020. After all, with over $162 billion up for grabs, there’s more than enough to go around for everyone, whether you’re a big outfit or a small indie dev. It’s time to make your move…
Skillsearch specialise in placing people on Games, Augmented and Virtual projects across the globe. Want to explore some of the opportunities we have? Send your cv through to firstname.lastname@example.org or call us now on +44 1273 287 007
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