Virtual Reality Market Size, Share & Trends Analysis Report By Component (Software, Service), By Deployment (On-Premise, Cloud), By Organization Size (Large Enterprises, SMEs), By Applications (Sales and Marketing Analytics, Supply Chain Operations Management, Merchandising Analytics, Customer Analytics, Others) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Market Overview

The global virtual reality market size was valued at USD 21.3 billion in 2022. It is projected to reach USD 200.3 billion by 2031, growing at a CAGR of 28.3% during the forecast period (2023–2031).

A digitally created experience called virtual reality (VR) imitates a three-dimensional setting in the real world. The way we interact with the things and environment around us is changing thanks to virtual reality (VR). The global market is expanding as virtual reality is increasingly being used and adopted in various industries. With VR accessories like bodysuits, glasses, or headsets, viewers can have an immersive experience. The market is expanding due to the expanding use of this technology in instructional training, particularly for teaching engineers, mechanics, pilots, field workers, defense fighters, and technicians in the manufacturing and oil and gas industries. Virtual reality is widely used for many other applications besides education and training. The use of technology in VR exposure therapy allows for the treatment of mental health conditions in patients. Additionally, tourism businesses use VR technology to let prospective customers and clients take virtual tours of landmarks, famous locations, dining establishments, and hotels. Pose tracking, and 3D near-eye displays are used in virtual reality (VR) to give users an immersive sense of a virtual world. Virtual reality has applications in business, education (such as medical or military training), and entertainment (particularly video games).

Market Dynamics

What Are the Primary Factors Driving the Market for Virtual Reality?

An Increase of Virtual Reality Technology and Applications in The Healthcare Industry

In the healthcare industry, virtual reality is fundamental. To assist a surgeon in performing endoscopic surgery, virtual reality technologies are used to deliver the surgeon's view of a patient virtually. By using tools, programmers can create virtual reality apps for healthcare that sense their position in the physical environment and help to display static or three-dimensional models. Virtual reality technologies are used to build immersive mobile apps faster. Unity is a tool that can be used to create virtual reality projects and is a potent game engine. During the forecast period, virtual and augmented reality use for doctor training, fitness improvement, pharmacy management, teaching challenging subjects to medical students, and caring for and supporting patients after they leave the hospital are critical factors anticipated to boost adoption.

VR Gaming Systems Give Users a Comfortable, Realistic Experience.

Sales of VR gaming systems have been strong throughout the global coronavirus outbreak. The popularity of the Oculus Quest All-in-One VR gaming system, which comes with a headset, two touch controllers, a 15W adaptor, and AA batteries, is a result of these trends, creating incremental opportunities for businesses in the virtual and augmented reality market. Virtual and augmented reality product manufacturers are expanding the selection of VR gaming systems that are balanced, adjustable, and comfortable for users. With the aid of VR headsets, these gaming systems provide users with a realistic experience. Virtual reality technology has made a name for itself in the gaming sector in the last few years. A new gaming generation that offers players immersive, first-person experiences has been shaped by VR. Virtual reality has recently become more affordable and accessible thanks to developers like Oculus and HTC.

What Main Factors Will Slow Down the Market for Virtual Reality?

High power consumption and display latencies have an impact on VR devices.

The primary function of VR-enabled technology is the production of visuals from either a dynamic or stationary source. Any delay that causes the actual or perceived reaction time to exceed the necessary response time is called latency. Several factors, such as an imbalance in signal processing speed between the CPU and input or output devices, can contribute to latency in VR applications. The visual quality that the device displays is how users evaluate its quality. When the projection is delayed, the quality of VR-enabled devices declines. The location might be different from the fixed location if there is a problem with the perspective measurement. Because of this, the VR system needs low latency to maintain the virtual entity. The virtual object shouldn't lag by more than 15 milliseconds when adapting to a new scenario because this changes where the elements are located. Energy usage is another issue with VR applications. Customers want devices with long battery life, especially gaming ones. Sensors and other network interfaces also require energy. VR systems cannot be used for an extended time due to these problems.

What Are the Future Opportunities for Virtual Reality?

Digitalized Lessons in The Classroom Help Students' Attention Spans Grow

The landscape of education is changing due to VR. Virtual reality (VR) has the potential to transport students from their classrooms to Roman ruins and allow them to mix flammable chemicals in science class without needing to deal with expensive lab apparatus; both of these possibilities could help students concentrate for more extended periods. Startups and businesses in the virtual and augmented reality markets generate income from digitized classroom sessions. According to software provider vSpatial, teachers can now record lessons in-depth using 360-degree cameras thanks to digitized classroom sessions. If a student misses a class, they can use VR recordings to keep up with other students by using digitized classroom sessions, which companies in the market are raising awareness of.

Regional Analysis

North America Dominates the Global Market.

The global virtual reality market is bifurcated into four regions: North America, Europe, Asia-Pacific, and LAMEA.

North America is the most significant global market shareholder and is expected to grow at a CAGR of 27.9% during the forecast period. The U.S. and Canada are included in the analysis of the market in North America. The increasing market revenue in the U.S. is the primary cause of the market growth in North America. The United States is home to many technologically advanced companies, including Apple, Inc., Microsoft, Magic Leap, and Google LLC, and it conducts extensive VR research. Additionally, the American government encourages market expansion by providing online public health veterinary training courses. Due to rising internet usage and developments in immersive technology, the South American market is anticipated to expand steadily. A large number of virtual gaming enthusiasts and the adoption of VR by a broad audience segment is also driving the market for virtual reality in the area.

Asia Pacific is expected to grow at a CAGR of 28.6% during the forecast period. The Asia-Pacific virtual reality market analysis includes China, Australia, India, Japan, and the rest of Asia-Pacific. China, a significant distributor of HMDs and other VR-related hardware, saw a significant increase in the VR market. The market is growing in Southeast Asian nations due partly to technological advancements. When commercial 5G services were launched in Japan, telecom providers used strategic ingenuity to provide augmented reality (AR) and virtual reality viewing platforms that use 5G connectivity. Promising efforts by the government and other relevant organizations, like funds and investments to support VR businesses, are also promoting the use of VR technology in the area. The Guangdong province hosted previous conferences on the future of VR technology, which revealed that China alone contributed about USD 1.15 billion to the market for virtual reality.

Segmental Analysis

The market is segmented by type, application, and technology.

Based on type, the global market is bifurcated into head-mounted displays, gesture-tracking devices, projectors & display walls.

The head-mounted displays segment is the highest contributor to the market and is expected to grow at a CAGR of 28.56% during the forecast period. The market demand for VR headsets is driven by their increasing significance in consumer and business applications. The variety and adaptability of HMDs, including hybrid, tethered, and self-contained HMDs, drive the segment's growth. These tools provide training in various fields, such as the military, aerospace, engineering, research, and medicine. They use interactive virtual images to illustrate a wide range of use cases. Companies are constantly pursuing technological advancements to give customers a more immersive experience.

Based on application, the global market is bifurcated into consumer, healthcare, aerospace & defense, commercial, travel & tourism, enterprise, and others.

The commercial segment is the highest contributor to the market and is expected to grow at a CAGR of 28.12% during the forecast period. VR businesses have new growth potential due to the expanding use of VR headsets in the commercial sector, which includes retail stores, car showrooms, and real estate. The widespread use of VR technologies in the commercial sector directly results from the rising smartphone adoption rate. Many businesses are turning to virtual reality to introduce new products to the public. A social VR event hosted by the premium automaker AUDI AG used a digital platform to introduce the Audi e-Tron Sportback.

Based on technology, the global market is bifurcated into non-immersive, semi & fully immersive.

The semi & fully immersive segment is the highest contributor to the market and is expected to grow at a CAGR of 28.71% during the forecast period. The ongoing surge in demand for VR HMDs is to blame for the segment growth. The architecture of real-world surroundings is replicated in semi- and fully immersive technology on a digital platform. It necessitates using intricate simulators, sharp displays, and powerful PCs. Students can practice cognitive and motor tasks that they would not be able to do in a classroom or therapeutic environment thanks to VR technology. Construction, aviation, entertainment, and the auto industry are just a few vertical industries that have embraced semi- and fully immersive technology.

Impact of covid-19

For instance, the market disruption across the value chain and record decline in the global service sector is set to hamper the market growth for NMVE over fiber channel. The decrement in the worldwide GDP and fall in the countries' GDP constitutes a considerable share in the global market to curtail the market's growth perspectives. The current market volatility is also discouraging organizations from making some technological developments in the company jeopardizing the company's financial stability. This scenario and the pessimistic approach of organizations to cope with the current crises restrict the market's growth.

Recent Developments

• November 2022, Since its 2013 BBC debut, Peaky Blinders has garnered praise from critics and received some BAFTA nominations. And soon, fans will have a unique opportunity to enter the post-World War I Birmingham, England, world. Peaky Blinders: The King's Ransom, developed by Maze Theory, will debut on March 9, 2023.

• March 2022, A fintech company called Liquid Avtar Technologies Inc. has unveiled the first-ever loyalty program and payment card designed specifically for the metaverse. The card is a physical one that runs on the Engage360 payment card and digital banking solutions platform from OptimizeFT, which is available in the US.