Virtual Production Market Size, Share & Industry Analysis, By Type (Technology/System and Services), By Application (TV series, Commercial Ads, Movies, E-sports, and Others), and Regional Forecast, 2024 – 2032

The global virtual production market size was valued at USD 2.98 billion in 2023 and is projected to grow from USD 3.38 billion in 2024 to USD 9.62 billion by 2032, exhibiting a CAGR of 14.0% during the forecast period (2024-2032).

Virtual production is a technique that integrates real-time computer-generated imagery (CGI) with live-action filming. It involves using technologies such as Virtual Reality (VR) and Augmented Reality (AR) to create interactive and immersive environments on set. This approach enhances the collaboration between physical and digital elements, streamlining the production process, and potentially reducing post-production efforts. For instance,

• These techniques were extensively used in making “The Mandalorian” TV series. LED screens surrounded the set, displaying real-time virtual backgrounds that matched the filmed scenes. This allowed sectors and filmmakers to engage themselves in the virtual environment, resulting in more authentic performances and saving time that would have been spent on adding backgrounds in post-production.

The entertainment industry experienced a drastic change during the pandemic concerning its content delivery and production. As the pandemic began to slow down, consumer demand and interest in content and content spending from moviemakers, streamers, and broadcast networks increased. Additionally, the technology is evolving faster, making reskilling, business case progress, and variation management tough for later adopters. Hence, the adopters of the technology are increasing to enhance their production capabilities and compete in the market. For instance,

• In March 2022, Vū Technologies announced the USD 17 million seed investment to boost the virtual production studio network. The company closed the investment from Angel Investment, Topmark Partners, and ADX Lab's associations from Orlando, Tampa, and Texas.

Thus, the advancements, investments, and new market entrants are expected to shape this technology sector’s future and adoption patterns

Virtual Production Market Trends

Increasing Popularity of Real-time Game Engines Add a Comprehensive Value to Market Progress

Real-time game engines such as Unreal Engine offer the teams a prevailing way to combine augmented realities flawlessly and virtually with CGI and footage apprehended on sets. Unreal is the foremost virtual production across industries, intensifying possibilities for media and film creators. With Unreal, team members can build virtual characters and worlds to be displayed on big LED screens. Then, the virtual cameras are synced with cameras in Unreal so that the virtual scene changes as the cameras.

The technological progressions in the latest version of Unreal, Unreal Engine 5 (UE5), make animation and film production much easier. Hence, game engines have been a prominent part of enhancing the democratization of modernized production procedures, such as in-camera and pre-visualization effects. Thus, the implementation of real-time game engines across solutions in different applications, such as gaming, movies, and episodic series, is increasing. For instance,

• In December 2022, the Infocomm Media Development Authority (IMDA) of Singapore announced USD 3.6 million in funds to help attract international partners in IP and content creation. IMDA is also partnering with Epic Games to route an industry challenge from early 2023, targeting to train and aid local firms to understand and implement Unreal Engine for virtual production.

In these solutions, initiating game engines in the real-time visual generation has been transformational. It is enlightening the overall quality to enhance the virtual production market growth.

Virtual Production Market Growth Factors

Growing Implementation of LED Wall Mechanisms to Augment Market Advancement

LED video wall uses a lively background to match the parallax and perspectives from the camera through the film-making. It allows the camera to shoot photo real photography. It is an innovative method that produces magnificent visuals at the site. LED wall productions allow the creation of mass visual effects with actual-time and inexpensive real-scene productions. It helps filmmakers and directors adjust and change the set, improves the team's efficiency with its modernized technology, and provides an immersive experience for the actors.

Hence, several enterprises are advancing and modernizing the solutions with LED video walls and delivering an immersive experience to their users and audiences. For instance,

• In September 2023, Quantum Media Systems' XDR3LED Video Wall was declared DCI compliant by the DCI. For high-end home cinemas, the XDR3 LED Video Wall has been designed and manufactured exclusively by Quantum Media Systems. In addition to the latest movies available through the exclusive movie distribution service, Bel Air Circuit, Quantum offers a further choice of content.

• In June 2023, the LED Virtual Production Group of EBU, in alliance with Leyard and other key partners, organized a workshop on studios using LED walls. The workshop aimed to understand LED volume walls' benefits, complexity, and difficulties for television sports, news, sports, and other entertainment.

Thus, advanced end-to-end solutions replace traditional screens in virtual film-making studios. Such LED walls are renovating how TV, film, and streaming shows can be prepared, enabling instantaneously transformable backgrounds to seem behind actors. These innovations and initiatives to embrace LED wall technology drive virtual production market share.

RESTRAINING FACTORS

Limited Availability of Experienced and Skilled Workforce to Hamper the Market Development

As the technology is still evolving, there is an absence of talent with proactive experience in the industry, generating staffing difficulties for production studios. Moreover, the wider industry has historically lacked assortment in terms of industry knowledge and learnings, forming a talent funnel issue while hiring candidates of varied backgrounds for virtual-precise roles. Hence, most production houses and filmmakers look for employees in adjacent industries such as animation, AR/VR, automotive, and gaming. Also, due to a lack of skilled workforce, the directors and producers are sticking to traditional production methods. For instance,

• According to Panasonic Report 2023, virtual production is persistent in growing in the TV and film industry, with 40% saying they are using the technology on current projects, and while the remaining say they are likely to use it in the coming 18 to 24 months. As per the report, the inadequate pipeline of skilled workers in production is a major challenge filmmakers face.

A shortage of well-versed employees in the creative proficiencies of virtual production has become a barrier for enterprises trying to meet clients' requirements or pull off the bigger projects in the industry. It is the high-tech future of gaming and film-making worldwide; however, maximizing its potential must be determined by the industry’s capability to attract knowledgeable talent to this new field.

Thus, a lack of well-versed and experienced workers to work with high-end technologies can hinder market growth.

Virtual Production Market Segmentation Analysis

By Type Analysis

System/Technology to Dominate Supported by Rising Product Demand for Various Applications

Based on the type, the market is segmented into technology/system and services. According to our research, the system/technology holds the highest share in 2023 and is expected to grow at the highest CAGR owing to the factors mentioned below.

• In the Digital Content Creation Report 2023, the technology is a swiftly advancing approach in content creation, transforming conventional workflows that previously depended on green screens and chroma keying. Central to production are LED walls that exhibit high-resolution visuals and videos, crafting lifelike environments for actors’ interactions during filming. The LED quality in these walls is pivotal for the seamless integration of real and virtual components.


• Furthermore, TrendForce highlights the shift towards replacing conventional green screens with LED video walls, significantly reducing post-production duration and video production expenses. These walls find utility in entertainment and audio-visual sectors, such as movies, heightening the immersive on-site experience. This advancement is fueling the rise of LED walls within its applications, especially in film-making/movies.

Hence, the above statistics indicate higher adoption of the systems/technology for applications, including TV series, commercial ads, E-sports, and especially film-making/movies. Virtual production systems such as motion capture workstations, virtual cameras, and simulation cameras are anticipated to increase product demand in the coming years. This is due to increased use of virtual production technology in film studios and television shows.

By Application Analysis

Growing Use of the Technology and Film Production Budgets for Movie-making to Surge the Segment’s Growth

Based on the application, the market is categorized into TV series, commercial ads, movies, E-sports, and others. The virtual production technique for making movies held the maximum revenue in 2023 and is projected to grow at the highest CAGR as the companies in the market focus on developing and expanding their solutions by integrating innovative technologies such as LED screens, Virtual Reality (VR), Augmented Reality (AR), and more for giving viewers an immersive and real-life like experiences. For instance,

• In April 2023, Sony Electronics Inc. introduced a new toolset to enhance pre-production and on-set workflows. This solution is designed to work seamlessly with the HDR-enabled LED walls and Sony VENICE Crystal LED. It aims to boost performance, address typical production issues like color matching, and elevate in-camera visual effects.

Additionally, the segment growth is supported by a significant increase in film production budgets and an increasing use of visual effects across Hollywood and other regional movie studios. The rising trend of switching movie broadcasts from multiplexes and movie theaters to OTT platforms allows filmmakers to reach a wider audience.

REGIONAL INSIGHTS

As per our report, the market is studied across five regions, including North America, South America, Europe, the Middle East & Africa, and Asia Pacific. These regions are further categorized into leading countries.

North America is a frontrunner in adopting these techniques, particularly in the entertainment sectors of film-making/movies, TV series, and esports. The North American film-making/movies industry embraces technology to create visually captivating content, enhancing storytelling and audience engagement. For instance,

• In June 2023, Samsung Electronics introduced its latest digital signage collection at InfoComm 2023, the premier audio-visual trade event in North America held in Orlando, Florida. During the event, Samsung launched The Wall for virtual production, a specialized display set for enhanced storytelling and viewer engagement.

The Asia Pacific region is expected to grow at the highest CAGR throughout the projected period, attributed to increasing investments, collaborations, and acquisitions between regional and local players for expanding their base. For instance,

• In May 2022, Pixotope revealed strategic partnerships with major broadcast firms across Hong Kong, South Korea, Taiwan, Japan, China, The Philippines, Malaysia, Myanmar, India, Thailand, and Singapore.

China holds the highest share in the Asia Pacific owing to a growing focus on replacing green screens with LED walls and rising collaboration between Chinese filmmakers, driving the overall Asia Pacific market.

• In July 2023, Wuxi Studios introduced China’s largest LED volume for film production, utilizing cutting-edge Brompton technology to enhance visual quality and creativity.

Europe holds the second largest share in the global virtual recognition market owing to a surge in partnerships among key players and the introduction of enhanced products by integrating their solutions. Companies in the European region are introducing new products and enhancements to their existing ones to create a better visual experience for the viewers.

• In January 2023, Studio Fares of Sweden introduced EEN, Europe's largest projector-based production wall. Situated in Trollhattam, Studio Fares is the second-largest soundstage in Scandinavia, encompassing an expansive area of 1,100 square meters. This development signifies a noteworthy advancement in production facilities, showcasing the integration of cutting-edge technology for enhanced business operations and creative events.

South America’s growth is driven by the surge in Research & Development (R&D) activities in the region to offer innovative and cost-effective solutions to consumers. For instance,

• In November 2022, Nestle unveiled a new Research & Development (R&D) Center dedicated to Latin America to foster innovation in collaboration with regional consumers. This initiative harnesses Nestlé's global scientific expertise while embracing the proximity to local consumers, commercial teams, and production facilities. The center’s focus lies in crafting delectable, nourishing, cost-effective, and eco-friendly products that resonate with the preferences of local consumers. Moreover, establishing this center enhances collaborations with universities, startups, and entrepreneurial ventures throughout the Latin American region, benefitting the growth of the Latin American market.

Further, the Middle East and Africa are experiencing positive growth in the market. The increasing partnerships among the regional and local players are expanding the opportunity for producing enhanced systems. For instance,

• In July 2023, ROE Visual collaborated with AVI-SPL, Pixotope, and Illusion XR Studio to organize an XR broadcast in Dubai, providing valuable insights and immersive experiences. This event was tailored for participants, including content creators, TV/film production professionals, broadcasters, and esports enthusiasts interested in the technology.

Thus, the increasing partnerships among players have highlighted the expansion of the market in countries including Turkey, UAE, Saudi Arabia, and Dubai.

List of Key Companies in Virtual Production Market

Key Players Launch New Products to Strengthen Market Positioning

Prominent market players actively create advanced solutions to cater to customer demands. They also focus on enhancing their existing product portfolio to deliver flexible solutions with unique attributes. Furthermore, these organizations proactively pursue collaboration, acquisitions, and partnerships to bolster their product offerings.

List of Key Companies Profiled:

• Adobe (U.S.)


• Autodesk, Inc. (U.S.)


• HTC Corporation (Taiwan)


• Sony Corporation (Japan)


• ARRI AG (Germany)


• Mo-Sys Engineering Ltd. (U.K.)


• Pixotope (Norway)


• FuseFX (U.S.)


• 80six (U.K.)


• TREE Digital Studio (Japan)

KEY INDUSTRY DEVELOPMENTS:

• In August 2023, Mo-Sys Engineering announced the VP Pro XR LED Content Server Solution integration at Solent University in Southampton, U.K. The studio will include an LED wall and a Mimik lighting panel, providing lighting and cinematic reflections combined with Mo-Sys’s VP Pro XR and StarTracker to deliver film production courses at Solent University.


• In July 2023, FuseFX partnered with Rosco, a global provider of lighting and backdrop technologies, to deploy its RDX lab system with FuseFX on Max’s Original series, Full Circle, the first production to use the innovative technology.


• In June 2023, Mo-Sys Engineering collaborated with NovaStar, an LED processor company, to introduce its production technology to InfoComm. The demonstration integrates NovaStar LED processing with Mo-Sys’s StarTracker camera tracking and VP Pro XR LED content server solution to bridge accurate tracking and the virtual shots in virtual production.


• In May 2023, ARRI Solutions designed the ideal solution for cinematic quality production and technical integration services for StylePhotos Studios, a developed production facility in Canada. The studio is mainly designed for commercial and e-commerce customers and is also equipped to support advanced feature productions.


• In May 2023, Pixotope collaborated with the University of Gloucestershire under the Pixotope Education Program partner and introduced Pixotope Pocket, an application to access augmented reality and virtual studio workflows and tools. The consumers can use their mobile phone's camera to film while Pixotope Pocket handles the camera tracking. This app can run on a smartphone with iOS and a PC to create immersive and powerful content anywhere.

REPORT COVERAGE

The report provides a detailed analysis of the market and focuses on key aspects such as leading companies, product/service types, and leading product applications. Besides, the report offers insights into the market trends and highlights key industry developments. In addition to the factors above, the report encompasses several factors that contributed to market growth in recent years.

Report Scope & Segmentation

ATTRIBUTE	DETAILS
Study Period	2019-2032
Base Year	2023
Estimated Year	2024
Forecast Period	2024-2032
Historical Period	2019-2022
Growth Rate	CAGR of 14.0% from 2024 to 2032
Unit	Value (USD Billion)
Segmentation	By Type Technology/System Services By Application TV series Commercial Ads Movies E-sports Others (Online Video, Events, Music Concerts, etc.) By Region North America (By Type, By Application, and By Country) U.S. Canada Mexico South America (By Type, By Application, and By Country) Brazil Argentina Rest of South America Europe (By Type, By Application, and By Country) U.K. Germany France Italy Spain Benelux Nordics Rest of Europe Middle East and Africa (By Type, By Application, and By Country) Turkey Israel GCC North Africa South Africa Rest of Middle East and Africa Asia Pacific (By Type, By Application, and By Country) China Japan India South Korea ASEAN Oceania Rest of Asia Pacific