2024 will be a big year for AR/VR, but mainstream adoption will lag
A host of new devices hitting the market this year could provide a shot in the arm for an industry that saw sluggish sales in 2023 as buyers awaited Apple’s entry.
The augmented/virtual reality (AR/VR) market is already buzzing with announcement of several products during last week’s Consumer Electronics Show (CES).
While adoption of so-called XR technologies (a term used to cover augmented, mixed and virtual reality) remains at an early stage, hardware vendors continue to push toward mainstream acceptance by businesses and consumers. At CES, that meant the unveiling of new mixed-reality headsets, smartglasses, and a Qualcomm processor that promises to power a new generation of hardware later this year.
“Announcements at CES and in general in this space will help spur the market and innovation required to create a comprehensive ecosystem, which will help the industry evolve (and increase adoption),” said Tuong Nguyen, director analyst at Gartner.
After a backlash against the metaverse and related technologies in recent years, the mood appears to have shifted, starting with the first unveiling last summer of Apple’s Vision Pro. (The headset will be available for pre-order on Friday and hits stores on Feb. 2.) In addition, Meta’s Quest 3 headset and Ray-Ban smartglasses have garnered largely positive reviews, reigniting public interest in virtual- and mixed- reality devices.
That follows a tough 2023 for the market: device shipments declined 8.3% to 8.1 million devices — a small number relative to the money invested in product development, according to a recent report from IDC. However a sales rebound is predicted during 2024, IDC analysts say, up 46% compared to last year.
“We’re still very far from mainstream adoption,” said Nguyen, with low single-digit percentage adoption for VR and AR headsets currently. Addressing hardware limitations is just one part of the puzzle here. The challenge for progress towards early majority (let alone mainstream) is the underlying ecosystem of content, services and applications.”
The good news for the industry, he said, is that the devices now coming to market can “spur interest and innovation” in the wider ecosystem. “In turn, this helps the industry evolve,” Nguyen said.
The biggest AR/VR announcements during CES were not at the event itself. Though Apple announced the release date for its long-awaited Vision Pro in the US, no such date has been set for other countries. The device is expected to come to a handful of other markets, including the UK and Canada, later in the year.
“By far, the most significant announcement in recent months is Apple’s Vision Pro announcement,” said Nguyen. “Apple’s validation of the market has and will continue to usher in competitors as well as other critical providers to the ecosystem that needs to establish and grow to make AR and VR HMDs [head-mounted displays] successful.”
With a $3,499 price tag, the Vision Pro isn’t aimed at mass audience; IDC analysts are predicting around 200,000 unit sales this year, with business customers likely to be the primary audience at first. Another analyst expects Apple will quickly sell out of a first run of around 60,000 to 80,000 devices, according to a CNBC report last week.
The hype generated by Apple’s arrival in the market will have a spillover effect on consumer interest in spatial computing — Apple’s term for mixed reality technology — more broadly.
“Apple’s entry into spatial computing has catalyzed the market, giving the competition a target to hit — or avoid,” said Avi Greengart, president and lead analyst at Techsponential.
Computerworld
