AR & VR headset sales to rocket driven by enterprise, finds IDC

The IDC predicts a surge in headset sales as businesses realize a wealth of AR & VR use cases.
2 April 2019 | 332 Shares

An attendee wears a VR headset while playing an interactive game at the Qualcomm booth at CES 2019. Source: AFP

Shipments of augmented reality and virtual reality (AR/VR) headsets will jump 54 percent to 8.9 million units worldwide this year, dominated by uptake among enterprise.

As enterprise technology moves into mixed reality platforms and augmented reality starts gaining traction in the marketplace, companies are looking to integrate these emerging technologies in a bid to increase competitiveness and profitability.

According to the International Data Corporation’s (IDC) Worldwide Quarterly Augmented and Virtual Reality Headset Tracker, worldwide shipments of augmented reality and virtual reality (AR/VR) headsets are forecasted to reach 8.9 million units in 2019, up 54.1 percent from 2018.

DC forecasts shipments for virtual reality headsets to reach 36.7 million units in 2023 with a five-year CAGR of 46.7 percent.

Among the various products and form factors, standalone headsets will account for 59 percent of all VR headsets shipped in 2023, followed by tethered Head-Mounted Displays (HMDs) with 37.4 percent share of shipments and screenless viewers accounting for the remainder.

In the AR headset market, total shipments are expected to reach 31.9 million units in 2023 with a 140.9 percent CAGR.

Once again, standalone headsets will lead the market with 17.6 million units shipped and 55.3 percent share in 2023, followed by tethered HMDs with 44.3 percent share, and screenless viewers capturing less than one percent.

“New headsets from brands such as Oculus, HTC, Microsoft, and others will help fuel the growth in 2019 and beyond,” said Jitesh Ubrani, Research Manager for IDC’s Mobile Device Trackers.

“However, it’s not just new products from headset makers that will drive the AR/VR market forward… Qualcomm’s latest silicon is also expected to play a major role in enabling hardware partners and providing network connectivity for content creators,” said Ubrani.

When it comes to the overall AR/VR headset market, roughly two-thirds of all headsets will be shipped into the commercial segment in 2023 as many AR headsets and a significant portion of VR headsets will cater to this audience.

The types of industries and use cases for these deployments will vary dramatically, but key vertical use cases include everything from training and services to retail and design.

“Some of the early movers in the VR space have wisely moved to embrace commercial use cases for the technology as they wait for more consumer-centric experiences beyond gaming and video to materialize,” said Tom Mainelli, Group Vice President of Devices & AR/VR at IDC.

“The AR side of the headset business has been largely enterprise-focused from the start, with a few notable exceptions, and we expect that trend to continue for the foreseeable future as most consumers in the near term will experience AR through their smartphone or tablet,” he explained.

Recently, AT&T started selling the Magic Leap One AR headset, which retails for US$2,295 at a handful of stores in the U.S.

While the high price may be a barrier for some, Magic Leap has been working on building content for the device, including partnerships with major sporting brands, media networks and business video services.

Products like Magic Leap stimulate the user’s senses through spatial computing where the digital world enhances the physical world.

Companies in the fields of education, telemedicine, sports and entertainment will see that customers’ experiences can be transformed into something quite extraordinary if they are willing to bet on emerging technologies as they future proof their businesses.