Commercial and Public Sector Investments Will Drive Worldwide AR/VR Spending to $160 Billion in 2023, According to a New IDC Spending Guide

FRAMINGHAM, Mass.–(BUSINESS WIRE)–#AR–Worldwide spending on augmented reality and virtual reality (AR/VR) is
forecast to reach $160 billion in 2023, up significantly from the $16.8
billion forecast for 2019. According to the International Data
Corporation (IDC)
Worldwide
Semiannual Augmented and Virtual Reality Spending Guide, the
five-year compound annual growth rate (CAGR) for AR/VR spending will be
78.3%.

IDC expects much of the growth in AR/VR spending will be driven by
accelerating investments from the commercial and public sectors. The
strongest spending growth over the 2019-2023 forecast period will come
from the financial (133.9% CAGR) and infrastructure (122.8% CAGR)
sectors, while the manufacturing and public sectors will follow closely.
In comparison, consumer spending on AR/VR is expected to deliver a
five-year CAGR of 52.2%.

“A growing number of companies are turning to virtual reality as a way
to drive training, collaboration, design, sales, and numerous other use
cases,” said Tom
Mainelli, group vice president, Devices and Consumer Research at
IDC. “Augmented reality uses cases are also growing with a wide variety
of companies leveraging next-generation hardware, software, and services
to fundamentally change existing business processes and bringing new
capabilities to first-line workers who require hands-free technology.”

The commercial use cases that are forecast to receive the largest
investments in 2023 are training ($8.5 billion), industrial maintenance
($4.3 billion), and retail showcasing ($3.9 billion). In comparison, 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.
The use cases that will see the fastest spending growth over the
forecast period include AR for lab and field education, AR for public
infrastructure maintenance, and AR for anatomy diagnostic.

Hardware will account for more than half of all AR/VR spending
throughout the forecast, followed by software and services. Strong
spending growth (189.2% CAGR) for AR viewers will make this the largest
hardware category by the end of the forecast, followed by VR host
devices. AR software will be the second fastest growing category,
enabling it to overtake VR software spending by 2022. Services spending
will be driven by strong growth from AR consulting services, AR custom
application development, and AR systems integration.

“Augmented reality is gaining share in the commercial market due to its
ability to facilitate tasks, provide access to resources, and solve
complex problems,” said Marcus
Torchia, research director, Customer
Insights & Analysis at IDC. “Industries such as manufacturing,
utilities, telecommunications, and logistics are increasingly adopting
AR for performing tasks such as assembly, maintenance, and repair.”

On a geographic basis, China will see the largest AR/VR spending totals
throughout the forecast, followed by the United States. The two
countries will account for nearly three quarters of all spending
worldwide by 2023. Western Europe will see the fastest growth in AR/VR
spending with a five-year CAGR of 101.1%, followed by the U.S. and China.

The Worldwide
Semiannual Augmented and Virtual Reality Spending Guide examines the
AR/VR opportunity and provides insights into this rapidly growing market
and how the market will develop over the next five years. Revenue data
is available for eight regions, 12 industries, 26 use cases, and eleven
technology categories. Unlike any other research in the industry, the
comprehensive spending guide was created to help IT decision makers to
clearly understand the industry-specific scope and direction of AR/VR
expenditures today and in the future.

About IDC Spending Guides
IDC’s Spending Guides provide a
granular view of key technology markets from a regional, vertical
industry, use case, buyer, and technology perspective. The spending
guides are delivered via pivot table format or custom query tool,
allowing the user to easily extract meaningful information about each
market by viewing data trends and relationships.

About IDC
International Data Corporation (IDC) is the
premier global provider of market intelligence, advisory services, and
events for the information technology, telecommunications, and consumer
technology markets. With more than 1,100 analysts worldwide, IDC offers
global, regional, and local expertise on technology and industry
opportunities and trends in over 110 countries. IDC’s analysis and
insight helps IT professionals, business executives, and the investment
community to make fact-based technology decisions and to achieve their
key business objectives. Founded in 1964, IDC is a wholly-owned
subsidiary of International Data Group (IDG),
the world’s leading media, data and marketing services company. To learn
more about IDC, please visit www.idc.com.
Follow IDC on Twitter at @IDC
and LinkedIn.

Contacts

Marcus Torchia
mtorchia@idc.com
508-988-7571

Michael
Shirer
press@idc.com
508-935-4200