In-depth market insights are useful for predicting the success or possible failure of a product or industry as a whole — and help to prevent overly optimistic forecasts. However, when it comes to the global virtual reality (VR) market, figures for estimated future worth have catapulted far beyond any previous prediction.
The virtual reality market, as a whole and in terms of revenue, was estimated to be worth $58.7 billion in 2022, and is poised to reach $441.84 billion by 2030, growing at a CAGR of 28.7% from 2022 to 2030 according to a new report published by The Insight Partners.
The country scope of the report covers, alphabetically: Argentina, Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Mexico, Saudi Arabia, South Africa, South Korea, Spain, United Arab Emirates, United Kingdom and the United States.
What does this predicted exponential growth mean for VR as an industry?
“You can have data without information, but you cannot have information without data.” — Daniel Keys Moran.
Defining the World of Virtual Reality
According to the Virtual Reality Society, VR in technical terms is defined as “the term used to describe a three-dimensional, computer generated environment which can be explored and interacted with by a person. That person becomes part of this virtual world or is immersed within this environment and whilst there, is able to manipulate objects or perform a series of actions.”
But what does VR mean to us? The technology is certainly evolving with speed and has been shown to change our consumer behavior and perceptions as buyers. Our first thoughts when presented with an idea of VR are headsets and gaming, being thrown into another world of 3D audio and the use of sensors to transport us to a virtual space.
Indeed, the VR entertainment industry leads the VR market with 70% of headsets sold to VR gamers. Augmented and virtual gaming is only set to rise as we all continue to buy smartphones, laptops and gaming consoles as well as other handheld gadgets and accessories. It’s easy to see why the hardware segment accounted for the principal revenue share in 2022.
And these devices allow us not just to play, but to access live performances and events from the comfort — and safety — of home, a concept perhaps made more attractive by the recent pandemic.
VR and Other Verticals
Besides gaming and entertainment, there are uses of VR in other industries. In fact, any industry where there is a need for visual description can use VR, and these include:
- Health care
- Real Estate
- Interior Design
Forbes lists some of the best uses for VR, including:
- Medical treatment and diagnosis
- Post-trauma care, psychological health care and meditation
- Workplace training – global brands use VR for training, including Walmart, MGM Resorts, Bank of America, FedEx, Porsche and UPS to name just a few
- Simulated driving – the capability to play out risky driving scenarios minus any actual danger
- Engineering and construction design
- Experiencing distant travel destinations (virtually stay before you pay)
- Family reuniting – for example, cases where military active servers can be virtually present for important family events such as a birth.
So, we can see how this adoption of the VR market across different verticals, in addition to gaming and entertainment, is projected to lead the overall VR market growth over the forecasted period.
Investors in VR
With the increasing interest in this vertical and the information from predictions found in The Insight Partners report, it’s no wonder that there is a heightened interest for investors in VR.
The U.S. leads in the VR market with research and development (R&D) concentrated around Silicon Valley and all of the major IT giants such as Apple, Google and Meta. The U.S. has the maximum active VR venture capital funds, according to the report, making it a promising location for VR start-ups.
VR companies are also making waves in the augmented reality (AR) space, and investors have the chance to hit two home runs at once. This makes it an exciting time for trading in VR stocks, and worth noting is the venture capital firm NFX has used Signal – a free tool – to compile a list of top AR/ VR seed investors to help founders identify the best introductions and investments.
If the in-depth market insights are predicted correctly for the global virtual reality market, it’s a good chance to diversify your investment portfolio with exposure to this vertical with significant potential growth. As EA sports says, “It’s in the game.”