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Friday, April 17, 2020

Augmented and Virtual Reality Gains Commercial Apps

According to the latest worldwide market study by IDC, spending on augmented reality and virtual reality (AR/VR) is forecast to be $3.7 billion in 2019 -- that's an increase of 34 percent from the previous year.

Asia-Pacific spending on AR/VR products and services will continue this strong growth throughout the forecast period (2018-23), with a five-year compound annual growth rate of 62 percent. This growth is primarily driven by commercial industries which are going to be more than $11 billion larger than the consumer segment by the end of the forecast (2018-23).

Despite this, the consumer segment (which is currently at $1.7 billion in 2019) continues to be larger than any other industry segment over the forecasted period.

AR and VR Use Case Market Development

The high growth in the commercial segment is primarily due to the AR/VR capability to solve complex business problems and streamline operations. The two industries that are seeing the most activities or implementation in Asia-Pacific are education ($495.3 million in 2019) and retail ($244.4 million in 2019).

"Specialized training programs in the education system that includes VR pilot training through simulations, learning of human anatomy, etc. have given an opportunity to develop a specific skill set in the virtual environment. Leveraging this technology, the chances of making errors will not have fatal consequences during the training process. This has turned out to be a huge transition for institutes to save time for distance learning purposes and help in reducing cost due to the travel expenses incurred on students," said Ritika Srivastava, associate analyst at IDC.

Similarly, high-end retailers came across improvised customer engagement programs using this technology. This has also helped them in delivering the products based on customizing to a specific customer’s choice with the same or less time and effort. The technology has seen an increase in consideration and solutions around Online retail showcasing, retail showcasing, and virtual test drive.

Despite the fact that the two industries have the highest market spend, there are other industries that have high potential to grow at a faster pace over the forecast period (2018-23) – with some of the new use cases in the pipeline.

Retail (94.8 percent CAGR), followed by utilities, securities, investment services, and process manufacturing are the industries that are gaining momentum to explore the new use cases and are lucrative in terms of investments.

Use cases that dealt in operational tasks with the help of the Augmented Reality for performing tasks like assembly, maintenance, and repair have a lot of impetus within the industries.

Hardware will account for more than half of all AR/VR spending throughout the forecast, followed by software, and services. Services spending will see strong CAGRs (94.8 percent) for systems integration, followed by consulting services, and custom application development, while software spending will have a (70 percent) CAGR.

Outlook for AR/VR Applications Investment Growth

Of the two reality types, spending in VR solutions will be greater than that for AR solutions initially. However, strong growth in AR hardware, software, and services spending (135.5 percent CAGR) will push overall AR spending well ahead of VR spending by the end of the forecast period (2018-23).

On a geographic basis, China market will represent the largest AR/VR spending in the APEJ region with more than 81 percent share in 2019 and the spending is projected to take off at a five-year CAGR of 63.8 percent over the forecast period.

While AR/VR technology in ASEAN countries of the Asia-Pacific region has started gaining prominence and has partnered with AR/VR enterprises to improve the industry experience.