According to a new report from the International Data Corporation (IDC), global spending on augmented reality (AR) and virtual reality (VR) is expected to reach $17.8bn during 2018.
The report, named “Worldwide semiannual augmented and virtual reality spending guide” expects that spending will almost double next year, rising 95% from the $9.1bn forecast for this year.
Within this, the consumer sector is expected to remain the key driver in AR/VR. The IDC forecasts that the consumer spending will drive $6.8bn in industry sales through software and hardware devices, largely through those used for gaming.
“VR will continue to drive greater levels of spending in the next 12-18 months, as both consumer and commercial use cases gain traction. There is currently a huge appetite from companies that see tremendous potential in the technology, from product design to retail sales to employee training,” said Tom Mainelli, Program Vice President, Devices and AR/VR at IDC.
“Meanwhile, the AR market will deliver more modest levels of spending near term with mobile AR on smartphones and tablets likely to garner the most attention from consumers, while head-mounted displays will primarily sell into commercial use cases.”
Further, the IDC expects that this growth rate will be maintained throughout the period 2017-2021, predicting that the market will see a five-year compound annual growth rate (CAGR) of 98.8%.
Again, the consumer market is expected to show the majority of this growth. Whilst consumers currently account for 60% of AR/VR spending, this is expected to rise to 85% by 2021, even with the market expected to grow significantly throughout this period.