New Study Projects VR Revenue to Reach $12.2 Billion by 2024
ARtillery Intelligence publishes its five-year outlook for VR revenues.
12/17/20 – SAN FRANCISCO – ARtillery Intelligence today released a new report that projects VR revenue to grow from $4.98 billion in 2019 to $12.19 billion in 2024, a 19.6 percent compound annual growth rate. Entitled VR Global Revenue Forecast, 2019-2024, the report examines VR revenue totals and subsegments – including consumer and enterprise spending.
Consumer spending holds a leading share of VR revenues with an estimated $2.7 billion in 2020, which includes hardware and software. Enterprise spending trails due to relatively narrow applicability in industrial settings, while consumer spending is driven by gaming’s dominance as a VR use case. This will broaden to other categories over time, including entertainment and communications.
VR’s biggest accelerant is Facebook’s ongoing investments, including Oculus Quest 2. Facebook has priced the device competitively at $299 (64 GB base model). This competitive pricing is part of Facebook’s longer-term strategy to sacrifice margins to build market share and to get more people into VR.
“Quest 2 has an unmatched quality-to-price ratio with an impressive spec sheet and a mainstream-friendly price tag,” said ARtillery Intelligence Chief Analyst Mike Boland. “This flows from Facebook’s aggressive pricing strategy that’s part of a larger play to build market share and cultivate a network effect. It’s classic Facebook.”
2020 has also brought opposing forces: VR gaming aligns with Covid-era consumer demand signals, but supply chain impediments have detracted hardware shipments. The net effect is a 10 percent decline in shipments this year, which is projected to bounce back by the end of 2021.
“VR demand remains high, so 2020 challenges were more about supply,” said Boland. “These setbacks have been alleviated to some degree by Facebook’s efforts to reinforce its supply chain to meet heavy demand for Quest 2. This appears to be working so far with fewer stock shortages than it had last year at this time.”
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ARtillery Intelligence chronicles the evolution of spatial computing, otherwise known as AR and VR. Through writings and multimedia, it provides deep and analytical views into the industry’s biggest players, opportunities and strategies. Products include the AR Insider publication and the ARtillery PRO research subscription. Research includes monthly narrative reports, market- sizing forecasts, consumer survey data and multimedia, all housed in a robust intelligence vault. Learn more here.
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