Global technology giants, including Apple, Meta and Microsoft, are racing to create devices that will drive the so-called “immersive era” – when augmented and virtual reality begin to intertwine with everyday life, radically transforming both work and play.
“Immersive technology will touch every part of our economy,” says Jessica Driscoll, director of immersive technology at the Digital Catapult Innovation Center. It expects a “big push” to use technology to make the design and manufacture of goods more efficient, and to enable more environmentally sustainable means of cross-border cooperation.
Consumer spending on virtual reality is expected to triple by 2027, reaching $5.7 billion globally, according to technology consulting firm Omdia. Omdia expects it to reach $2.83 billion in the United States and $458 million in China by 2027.
But the true potential of immersive technology has yet to be revealed, as developers face the challenges of miniaturizing, designing, and making different hardware and software interoperable.
Augmented reality involves combining a view of the real world with 3D graphics, while virtual reality involves creating a completely virtual world. General Electric created an early version of the latter in the 1970s to make a flight simulator for training pilots. But they have only found wider adoption among consumers relatively recently, and adoption rates remain low.
“The past 10 years have heralded a new era in VR marketing, but we are still in our teens,” admits Tung Nguyen, emerging technologies and trends analyst at consultancy Gartner. “It’s a small market but it’s growing fast,” he says, adding that use among consumers is usually sporadic, and on a limited basis.
Augmented reality is already a popular feature of applications that use smartphone cameras or photos. Examples include subtitling applications; Fun face filters on photo apps like Instagram; shopping apps that put pairs of glasses on your face or the furniture in your living room; And a 3D cult game Pokemon Go.
Virtual reality has made more inroads into the workplace, with headsets becoming a key tool for specialized training. For example, BP uses them to train oil rig workers, avoiding the time, expense and safety risks involved in training at an offshore facility. Designers at Ford use them to test the shapes of new cars, rather than making life-sized models using clay.
However, augmented reality – a complex mix of the real and virtual world – is likely to have the greatest impact on heavy, capital-intensive industries, such as construction and maintenance, where people engage in “hand-intensive, just-in-time work”. information,” Nguyen explains.
Upcoming technology growth markets are in augmented reality and virtual reality
Countries to watch 2023-2027
we As a hub of AR/VR innovation, Meta will continue to invest, innovate and increase sales. The launch of the Apple Vision Pro will build excitement and interest.
United kingdom With a thriving ecosystem of studios and companies, Britain is poised to lead the European market in these areas.
China Despite its fragmented market today, China is expected to emerge as one of the industry leaders, led by major players such as ByteDance.
Japan Led by Sony’s PSVR2, Japan is set to become the second-largest VR market in Asia after China, with a growing AR/VR presence.
source: FT-Omdia Digital Economies Index
Microsoft’s HoloLens 2 headset is being rolled out in the manufacturing, construction and healthcare sectors. The mockups show someone repairing a piece of machinery while on a video call with someone giving instructions.
But right now, the most widespread application of VR is around gaming. “The main reason people buy these devices is gaming,” says George Jegiashvili, senior principal analyst at Omdia. Meta this month released the Quest 3 headset, which has sparked interest from game developers and is priced at $499 in the US.
However, Jegiashvili says: “I want to stress that, as far as this question is concerned with ongoing developments in hardware, we are seeing much slower progress in terms of content and use cases. This is the biggest challenge facing VR right now.”
However, other use cases are emerging in the automotive sector. Automakers are using augmented reality and virtual reality to develop the next wave of in-car entertainment systems, as well as providing on-road navigation.
Ford, Volkswagen and BMW are excited about virtual reality, but Chinese automakers are “prepared and very aggressive” in their partnerships, says David Tait, principal analyst at Omdia.
This shift toward immersive technology by automobile companies has been accelerated with the arrival of electric vehicles. But the rise of self-driving cars will spur more demand for in-car entertainment, from movies to karaoke.
“This is where these car companies now see their long-term future: selling you an entertainment package to effectively enable in-car media applications,” says Tate.
However, eventually, technology experts predict that the boundaries between augmented reality and virtual reality will blur, and they see the launch of the Apple Tech Vision Pro headset as an important milestone on this path.
Scheduled to launch early next year and expected to be priced at $3,499, Apple’s headset offers both virtual reality and augmented reality to create “spatial experiences.” What looks like a pair of Google snowboards from science fiction is actually a cutting-edge wearable computer.
The Pro’s predecessors include the Oculus Rift and Metaquest 3 headsets, but according to Catapult’s Driscoll, the Apple tech Vision Pro is a “step forward” in terms of design. Another big advantage is Apple’s ecosystem, which could allow headphone users to access pre-existing apps designed for the company’s other devices.
However, at present, the consumer VR headset market is dominated by Meta, with a 71.8 percent share, followed by Sony with 8.8 percent and Valve with 2.9 percent.
How the market develops may depend on how VR and AR developers are able to meet future challenges around interoperability, IP licensing permissions, and design – since most current headsets are too old to be suitable for the average consumer.
Another factor accelerating broader adoption is the launch of the 5G mobile network, which is designed to connect almost everything — including objects, people, and devices — and host complex 3D spaces like the metaverse.
“The low latency and high bandwidth of 5G could open doors to complex mixed reality applications, further bridging the gap between physical and digital experiences,” Jegiashvili points out.