VR Headset sales grow faster than expected as awareness grows and content improves

Ben Wood, chief of Research at CCS Insight

Global sales of dedicated virtual reality (VR) headsets will grow to 21 million units by 2020 — a tenfold increase over 2016.

However, the augmented reality (AR) device market, although growing, is taking longer than expected given its primary focus on business use

So says CCS Insight in its latest global forecast for virtual reality (VR) and augmented reality (AR) devices, which indicates a positive outlook for these nascent markets.

Sales of smartphone VR devices, including products based on Google’s Cardboard design and more advanced devices such as Samsung’s Gear VR headset, have exceeded CCS Insight’s earlier expectations. The company now predicts that 14.5 million smartphone VR headsets, worth over $500 million, will be sold in 2016.

Ben Wood, chief of Research at CCS Insight, commented, “Virtual reality has clearly captured consumers’ imagination, particularly those that have had a chance to try it. The affordability of basic cardboard headsets makes virtual reality easily accessible to smartphone owners, and the explosion of 360-degree content is taking awareness to new levels.”

This view is backed up by other market data points. In May, Google revealed that its Cardboard application has been installed over 50 million times, up from 25 million installs in January 2016. In July, Oculus VR disclosed there were more than 1 million monthly active users of the Oculus-powered Samsung Gear VR, and this month it was announced that more than 250,000 360-degree videos have been uploaded to Facebook.

Wood continued, “The momentum of 360-degree content is palpable and that’s driving sales of VR headsets. All major content providers are piling into this area, and user-generated content is poised to explode as more affordable 360-degree cameras come to market. We envision a world where ‘surroundie’ photos and videos become the next big thing, especially as 360-degree content can be so easily shared with more than 1.7 billion Facebook and YouTube users.”

Dedicated VR headsets like the Oculus Rift and HTC Vive are also performing well. CCS Insight estimates that approximately 2 million of this type of device will be sold in 2016, rising to 21 million in 2020.

Wood commented: “Although it’s early days for dedicated virtual reality, it’s a promising market. HTC and Oculus VR struggled to meet demand when they launched their products and we expect a further wave of sales when Sony launches the PlayStation VR headset.”

CCS Insight estimates that the total VR device market will be worth $1.5 billion in 2016, rising to $11 billion by 2020. Dedicated VR headsets will play a critically important role, accounting for 85% of total market value despite being only 23% of volume, as low-cost smartphone VR products sell in their millions.

In contrast, the market for augmented reality devices is progressing more slowly than expected. CCS Insight believes this can be attributed to the primary focus on enterprise solutions and the relative immaturity of the technology.

Although there are numerous very promising field trials underway, mass deployments remain elusive. As a result, CCS Insight forecasts sales of about 200,000 units in 2016.

However, the potential for AR technology is clear and this is reflected in CCS Insight’s forecast of 7 million unit sales in 2020, with a market value of $3.8 billion.

Wood commented, “We expect augmented reality technology to evolve quickly and the experience to improve dramatically. It’s little surprise that companies such as Microsoft and Google are placing such big bets in this area”.

He continued, “The added dimension of the Pokemon Go craze has undoubtedly raised awareness of the potential for augmented reality. That can only be positive for the technology.”

Comment on this article below or via Twitter: @IoTNow_ OR @jcIoTnow

RECENT ARTICLES

Inpixon and Schauenburg Systems team up to sell real-time location technologies to mining companies in South Africa

Posted on: September 26, 2022

Palo Alto, United States – Inpixon, the Indoor Intelligence company, announced a collaboration agreement with Schauenburg Systems, an original-equipment manufacturer of mine safety systems and equipment, to sell Inpixon’s real-time location technologies to mining companies in South Africa. Under the agreement the parties will aim to achieve sales of hundreds of thousands of nanoLOC chips and other core

Read more

How will OEMs manufacture the smart factories of the future?

Posted on: September 23, 2022

“By 2025, there will be approximately 27 billion connected IoT devices. Someone is going to have to manufacture these, and OEMs are gearing up to enable as many functions as possible to be integrated into the devices they build.”REGISTER NOW TO READIoT relies on manufacturing efficiency to get massive volumes of devices out into the

Read more
FEATURED IoT STORIES

9 IoT applications that will change everything

Posted on: September 1, 2021

Whether you are a future-minded CEO, tech-driven CEO or IT leader, you’ve come across the term IoT before. It’s often used alongside superlatives regarding how it will revolutionize the way you work, play, and live. But is it just another buzzword, or is it the as-promised technological holy grail? The truth is that Internet of

Read more

Which IoT Platform 2021? IoT Now Enterprise Buyers’ Guide

Posted on: August 30, 2021

There are several different parts in a complete IoT solution, all of which must work together to get the result needed, write IoT Now Enterprise Buyers’ Guide – Which IoT Platform 2021? authors Robin Duke-Woolley, the CEO and Bill Ingle, a senior analyst, at Beecham Research. Figure 1 shows these parts and, although not all

Read more

CAT-M1 vs NB-IoT – examining the real differences

Posted on: June 21, 2021

As industry players look to provide the next generation of IoT connectivity, two different standards have emerged under release 13 of 3GPP – CAT-M1 and NB-IoT.

Read more

IoT and home automation: What does the future hold?

Posted on: June 10, 2020

Once a dream, home automation using iot is slowly but steadily becoming a part of daily lives around the world. In fact, it is believed that the global market for smart home automation will reach $40 billion by 2020.

Read more

5 challenges still facing the Internet of Things

Posted on: June 3, 2020

The Internet of Things (IoT) has quickly become a huge part of how people live, communicate and do business. All around the world, web-enabled devices are turning our world into a more switched-on place to live.

Read more

What is IoT?

Posted on: July 7, 2019

What is IoT Data as a new oil IoT connectivity What is IoT video So what’s IoT? The phrase ‘Internet of Things’ (IoT) is officially everywhere. It constantly shows up in my Google news feed, the weekend tech supplements are waxing lyrical about it and the volume of marketing emails I receive advertising ‘smart, connected

Read more
IoT Newsletter

Join the IoT Now online community for FREE, to receive: Exclusive offers for entry to all the IoT events that matter, round the world

Free access to a huge selection of the latest IoT analyst reports and industry whitepapers

The latest IoT news, as it breaks, to your inbox