Virtual Reality (VR) Market Size, Share & Industry Analysis, By Component (Hardware, Software, and Content), By Device Type (Head Mounted Display (HMD), VR Simulator, VR Glasses, Treadmills & Haptic Gloves, and Others), By Industry (Gaming, Entertainment, Automotive, Retail, Healthcare, Education, Aerospace & Defense, Manufacturing, and Others), and Regional Forecast, 2024-2032

The global virtual reality (VR) market size was valued at USD 25.11 billion in 2023 and is projected to grow from USD 32.64 billion in 2024 to USD 244.84 billion by 2032, exhibiting a CAGR of 28.6% during the forecast period (2024-2032).

The market analysis includes devices and software such as Google Cardboard, Move Motion Controller and PlayStation Headset, Quest 2, Unity Virtual Reality Development Software, and Microsoft HoloLens 2. Virtual reality offers simulated customer experience and vast applications to healthcare, gaming, retail, automotive, and entertainment industries. Organizations implement this technology to conduct virtual training, engineering and maintenance, marketing, designing, assistance, and simulation events with their workers and employees. In addition, the major players in the market are focused on providing advanced hardware and content to enhance customer experience. For instance:

• In April 2022, Nikon Corporation collaborated with Microsoft Corporation to design and develop virtual reality and 3D content solutions, focusing on improving the content creation space.

The manufacturing and production plants of devices, equipment, components, and other hardware products had been impacted due to the coronavirus outbreak worldwide. Thus, initially, in 2020, with the limited stock of virtual reality products and services, the market witnessed a decline in its year-on-year trend, affecting the global market.

However, in many industries, the technology appeared with a true perspective to support the pandemic crisis. The need for VR augmented in healthcare, gaming, education, manufacturing, entertainment, military, retail, and defense, among others. For instance, in 2020, the Kansas City University Center for Medical Education Innovation incorporated technology for medical students' training using simulations. Thus, the demand for VR in commercial industries increased significantly during the pandemic.

Virtual Reality (VR) Market Trends

Growing Potential in Healthcare Industry to Fuel Market Expansion

According to the experts’ study, healthcare is projected to witness significant disturbance across the sector with VR applications. The technology has highlighted the potential to enhance planned surgeries, healthcare provisions, patient care systems, and medical training.

Its simulated experience of replicating the real-world environs is expected to grow the demand in healthcare. Assisted robotic VR to support healthcare workers them during surgeries. It also offers surgical training to improve the required skills. For instance,

• In February 2022, VirtaMed and Memic Innovative Surgery collaboratively launched Memic’s Hominis surgical virtual reality system for surgeons’ preparation.

Furthermore, the Virtual Reality (VR) market has been dominant for the past few years due to major trends, such as increased end-user adoption, consistent & easier development of VR, greater improvements in hardware, growing enterprise applications, and huge availability of VR-tailored services. However, there are a few more trending factors that are expected to create a greater impact on the market in the coming years. A few of them are the emergence of hyper-realistic virtual reality, immersive education transformation, integration of AI in virtual reality, socially available VR platform expansion, and adoption of VR by various businesses.

Thus, the increasing applications of VR in healthcare will boost the virtual reality market growth.

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Virtual Reality (VR) Market Growth Factors

Increasing Live Virtual Entertainment to Drive Market Growth

The concept of live virtual entertainment is growing globally. Individuals prefer at-home entertainment by implementing technology to view live shows and events. As the technology provides users with a real-world environment, its demand for live events, live music concerts, or sports is rising considerably. For instance,

• In April 2022, Foo Fighters, the rock band artists, conducted their event on Meta virtual stage, providing 180-degree live streaming video over the Meta Quest headset.


• In March 2021, 3D-VR LiVE released a virtual event platform with real-time personal interaction and involvement.

Virtual reality uses computer technology to create a simulated environment, and prominent players in VR are Oculus Rift, PlayStation VR (PSVR), and HTC Vive, among others. The VR technology is consistently evolving beyond entertainment purposes, and companies have now realised the importance of VR in various sectors, such as science, healthcare, education, manufacturing, automotive, and retail, among others.

Thus, the rising demand for virtual live entertainment is probable to fuel the virtual reality market share.

RESTRAINING FACTORS

Health Concerns due to Excessive use of VR Devices to Impede the Market

Virtual reality technologies, especially virtual reality headsets, are widely used for e-sports and gaming for a unique playing experience. This excessive use of VR headsets might lead to health concerns such as dizziness, lethargy, lack of concentration, eyesight, and hearing issues. Thus, the excessive usage of these VR devices could lead to health concerns, which is expected to impact market dynamics slightly.

Virtual Reality (VR) Market Segmentation Analysis

By Component Analysis

Growing Investments in Advanced Hardware Offerings to Drive Market Growth

The market share is segregated into software, hardware, and content in terms of components.  The hardware segment will dominate the global market share during the forecast period as major companies are investing in the advancement of hardware. For instance, in May 2021, Axon released its VR-driven wireless simulator to offer hands-on training solutions.

The software will gain traction due to the increasing demand for VR technology. Growing applications such as live events, entertainment, gaming, and others, increase the software demand. The content will likely witness steady growth during the forecast period owing to rising demand for interactive virtual sessions. Industries are demanding new content for applications such as marketing, training, entertainment, gaming, and other sections.

By Device Type Analysis

Capability to Offer Immersive Environment to Fuel Head Mounted Display Demand

Based on the device type, the market is segmented into VR simulators, treadmills & haptic gloves, VR glasses, Head Mounted Display (HMD), and others. The HMD will lead as it provides a highly immersive experience. The demand for VR headsets connected to smartphones is rising due to cost-effective options such as Google's cardboard-based headset. HMDs are increasingly used in aviation, marketing, entertainment, and training industries. For instance, Vajro and VRM Switzerland were certified by European Union Aviation Safety Agency for virtual pilot training, providing a headset with human-eye resolution.

VR simulations are becoming popular in industries for training, design, and prototyping due to cost savings. Additionally, the gaming and entertainment sectors are also adopting VR treadmills and haptic gloves to enhance the customer experience. Thus, VR glasses in training and education will fuel the segment's growth.

By Industry Analysis

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Growing Investments for VR in Gaming and Entertainment Industry to Boost the Segment Growth

Gaming and entertainment segments hold the highest shares in the market, as companies heavily invest in developing content, software, and hardware for gaming purposes. The growing popularity of virtual theme parks, museums, and arcades drives the segment growth.

Further, healthcare is expected to grow at the highest CAGR during the forecast period owing to a successful implementation of VR in healthcare, providing a visual and controlled environment for medical professionals to diagnose and treat patients. For instance, virtual simulators can understand Alzheimer’s, assist autistic patients, detect vision impairment, and others.

REGIONAL INSIGHTS

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

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North America is expected to dominate the market share over the forecast period. The significant presence of key players in the U.S. is driving market growth in the region. In addition, various start-ups are entering the U.S. market and offering industry-specific solutions. For instance, in October 2020, a California-based small company, Sixense Enterprises Inc., launched a VR-based physical rehabilitation system called the REAL Immersive System. The U.S. government is also investing in virtual technology, which is likely to boost the market. For instance, the U.S. government and its army invested USD 11 billion in providing virtual, augmented, and mixed reality training sessions to its officials.

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Asia Pacific shows rapid growth during the forecast period due to the increasing demand for immersive technologies in emerging economies. China is likely to gain maximum market share, as it is one of the major distributors of head-mounted VR devices and other hardware. In addition, the developments in 5G networks and infrastructure in China are expected to boost market growth. On the other hand, India is likely to witness significant growth owing to government initiatives and funding.

Europe is likely to show significant growth during the forecast period. The region is the early adopter of virtual solutions in the automotive industry. According to the report published by the European Commission, the European virtual and augmented reality (AR) industry is expected to increase its production value to USD 38 billion by 2020. The U.K. and Germany are likely to gain traction owing to increasing investment in the market.

Latin America is expected to gain steady growth owing to increasing government focus on advanced technologies and rapid installation of 5G infrastructure.

The growing interest in virtual gaming and entertainment users boosts the demand in the Middle East & Africa.

List of Key Companies in Virtual Reality (VR) Industry

Focus on Global Expansion with Innovative Products to Boost Market Share

Major players in the market are developing new and advanced solutions for customers. They also focus on improving their existing product portfolio to provide flexible solutions with unique characteristics. Additionally, the organizations aim for collaboration, partnerships, and acquisitions to strengthen their product offerings.

List of Key Companies Profiled:

• Oculus (Meta Platforms, Inc.) (U.S.)


• Google LLC (Alphabet Inc.) (U.S.)


• Microsoft Corporation (U.S.)


• Sony Interactive Entertainment LLC (Japan)


• HTC Corporation (Taiwan)


• Samsung Electronics Co., Ltd. (South Korea)


• Unity Software Inc. (U.S.)


• Qualcomm Incorporated (U.S.)


• Nvidia Corporation (U.S.)


• HaptX Inc. (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• February 2024 – Sony Corporation announced its plans to include PC compatibility in the PlayStation VR2 model. Currently, the company is testing its compatibility with PC, and in the future, this will allow PS VR2 players access to more VR games via their PC.


• January 2023 – Apple will launch its mixed reality headset, which will feature augmented reality and virtual reality capabilities to enhance user experience.


• April 2022 – Shenzhen MetaVision Tech Co. released new specifications and designs for its VR headset. In addition, the company will provide the world’s lightest device based on extended reality.


• March 2022 – Nvidia Corporation collaborated with cloud service suppliers for high-quality VR streaming. Moreover, users can access augmented, virtual, and extended reality from any location with the help of cloud-based streaming.


• March 2022 – Unity Software Inc. partnered with Insomniac Events, a live music creator, to grow into the virtual environment from the physical world. Further, the organizations focus on offering live entertainment to the next generation's potential audience.

REPORT COVERAGE

The study on the market comprises major areas globally to get a better knowledge of the industry. Additionally, the research offers insights into the most recent market trends and analyses of technologies implemented worldwide. Further, it highlights the growth restrictions and elements, allowing the reader to understand the market.

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