Spending on augmented reality and virtual reality (AR / VR) is forecast to reach $160 billion in 2023 from $16.8 billion forecast for 2019, research report from IDC said.
Investments from the commercial and public sectors will drive much of the growth in AR / VR spending.
CAGR growth in spending on AR and VR over the 2019-2023 forecast period will be 133.9 percent in the financial, and 122.8 percent in infrastructure sectors, while the manufacturing and public sectors will follow closely. Consumer spending on AR / VR is expected to deliver a five-year CAGR of 52.2 percent.
“Augmented reality uses cases are growing with companies leveraging hardware, software, and services to fundamentally change existing business processes and bringing new capabilities to first-line workers who require hands-free technology,” Tom Mainelli, group vice president, Devices and Consumer Research at IDC, said.
AR and VR investments in 2023 will be $8.5 billion in training, $4.3 billion in industrial maintenance, and $3.9 billion in retail showcasing.
The three consumer use cases for AR / VR (VR gaming, VR video/feature viewing, and AR gaming) are expected to see spending of $20.8 billion in 2023. AR for lab and field education, AR for public infrastructure maintenance, and AR for anatomy diagnostic will be the use cases that will see the fastest spending growth.
Hardware will account for more than half of all AR / VR spending, followed by software and services. AR software will be the second fastest growing category, enabling it to overtake VR software spending by 2022. Services spending will be driven by growth from AR consulting services, AR custom application development, and AR systems integration.
“Industries such as manufacturing, utilities, telecom and logistics are increasingly adopting AR for performing tasks such as assembly, maintenance, and repair,” said Marcus Torchia, research director, Customer Insights & Analysis at IDC.
China and the United States will account for nearly three quarters of all spending worldwide by 2023.
