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Worldwide Shipments of Augmented Reality and Virtual Reality Headsets Expected to Grow at 58% CAGR with Low-Cost Smartphone VR Devices being Short-Term Catalyst, According to IDC

Augmented Reality (AR) and Virtual Reality (VR) continue to gain momentum in the mainstream tech media. According to recent forecast data from the International Data Corporation, (IDC) Worldwide Quarterly Augmented and Virtual Reality Headset Tracker, dedicated AR and VR headsets collectively are expected to grow at a very strong pace from just under 10 million units in 2016 to just shy of 100 million units in 2021, with a 5-year CAGR of 57.7%.

VR headsets have led much of the device volume to date. Within that category, screenless viewers (VR headsets powered by a smartphone), which are the cheapest available form factor, have been leading the charge. The second half of 2016 saw a ramp up in volume from three highly publicized market leading VR device products - the Sony PlayStation VR, the HTC Vive, and Facebook's Oculus Rift.

“The next six to 18 months will further stimulate the VR market as PC vendors, along with Microsoft, introduce tethered headsets and high-end standalone VR headsets also enter the market,” said Jitesh Ubrani senior research analyst for IDC Mobile Device Trackers. “With lower hardware requirements on the PC and lower prices on headsets, VR will be more accessible than ever before. And the introduction of additional motion tracking and hand tracking will help further blur the line between digital and physical reality.”

In terms of dedicated devices, AR continues to sit slightly in the background of VR. The reason for this is not that AR is less important, but rather it is harder to achieve. IDC believes VR headsets will continue to lead in terms of volume throughout the forecast, but maintains that AR in general will have a much bigger impact overall on the industry. Consumers are very likely to have their first AR experience via a mobile phone or tablet rather than a dedicated headset, and Apple's recent introduction of ARKit further supports this.

IDC believes the large opportunity for dedicated AR headsets exists in the commercial segment. A huge level of interest and investment is happening as we speak around vertical markets such as healthcare, manufacturing, field service workers, and design. Supporting this is a wide range of products, some of which are commercially available, but most are from non-household names.

"It is very clear to us that augmented reality is the larger of the two plays here when looking at AR and VR combined," said Ryan Reith, program vice president with IDC's Worldwide Quarterly Mobile Device Trackers. "Companies like Microsoft, Epson, Intel, Meta, ODG, and DAQRI are already providing devices that are being deployed in real-time commercial projects with significant ROI. The list goes well beyond that of other companies which have either deployed or are readying for deployment of similar devices. We believe that many industrial jobs will fundamentally change because of AR in the next 5-years, and these are much more opportunistic markets for dedicated AR headsets than the consumer market. We expect commercial shipments to account for just over 80% of all AR headsets shipped in the next 5 years."

                                   

Worldwide AR and VR Headset Shipments, Segment Share, and CAGR, 2016 - 2021

Product Category       Segment Group       2016 Units       2016 Share       2021 Units       2021 Share       CAGR% (2016-2021)
Augmented Reality       Commercial       110,512       68.0%       20,454,18       83.3%       184.1%
Augmented Reality       Consumer       51,946       32.0%       4,114,598       16.7%       139.7%
Total AR Headsets      

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      162,458       100.0%       24,568,76       100.0%       172.9%

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Virtual Reality       Commercial       1,838,19       19.9%       18,141,76       27.0%       58.1%
Virtual Reality       Consumer       7,399,36       80.1%       48,963,87       73.0%       45.9%
Total VR Headsets      

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      9,237,434       100.0%       67,105,53       100.0%       48.7%
 

In addition to the table above, an interactive graphic showing worldwide market share (based on unit shipments) for worldwide VR and AR headsets shipments is available here. The chart is intended for public use in online news articles and social media. Instructions on how to embed this graphic can be found by viewing this press release on IDC.com.

About IDC Trackers

IDC 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. The IDC Tracker Charts app allows users to view data charts from the most recent IDC Tracker products on their iPhone and iPad. The IDC Tracker Chart app is also available for Android Phones and Android Tablets.

For more information about IDC's Worldwide Quarterly Mobile Phone Tracker, please contact Kathy Nagamine at 650-350-6423 or [email protected].

About IDC

International 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 objectives. Founded in 1964, IDC is a wholly-owned subsidiary of International Data Group (IDG), the world's leading media, data and marketing services company. To learn more about IDC, please visit www.idc.com. Follow IDC on Twitter at @IDC.

All product and company names may be trademarks or registered trademarks of their respective holders.

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