Augmented Reality Industry Overview
The global augmented reality market size was estimated at USD 25.33 billion in 2021 and is anticipated to reach USD 597.54 billion by 2030, expanding at a CAGR of 40.9% over the forecast period. Companies are putting a strong emphasis on finding unique ways to exploit the potential of augmented reality (AR) technology and providing a unique and interactive experience to end-users is expected to drive the growth of the market over the forecast period. The proliferation of handheld devices, such as smartphones and smart glasses, and the subsequent increase in the adoption of mobile AR technology to provide a more immersive experience are expected to contribute to the growth of the market.
Companies are using AR-based apps for assembly functions, manufacturing functions, production line functions and analyzing tasks, and finding solutions. As such, the growing demand for remote assistance and coaction from industries working in optimization and workflow management also bodes well for the growth of the market.
Gather more insights about the market drivers, restrains and growth of the Global Augmented Reality market
The adoption of AR technology in marketing and advertising to host virtual events, product launches, virtual exhibitions, and online commercials has been gaining traction in the wake of the outbreak of the COVID-19 pandemic. For instance, the OnePlus Nord smartphone was launched in July 2020 using the AR platform Blippar. The increasing adoption of AR technology by the incumbents of the healthcare industry is also expected to play a vital role in driving the growth of the market. Several AR solution providers are collaborating with healthcare institutions and offering their AR tools to facilitate AR-powered healthcare. For instance, in February 2022, augmented reality company Altoida Inc. announced a partnership with Click Therapeutics to leverage AR technology to better help in understanding the baseline measures of cognition and the way it can potentially affect patient outcomes.
The growing use of AR technology in construction and architectural applications is expected to play a decisive role in driving the growth of the market. AR technology can potentially help in generating a 3D model of a blueprint and help in connecting imagination with reality. AR technology can also be used in the education industry to enhance the learning experience for students. AR technology can help in providing an immersive experience using 2D/3D models, AR books, and AR games, and subsequently, aid in the development of different skill sets in students, thereby driving the growth of the augmented reality market.
AR technology holds the potential to revolutionize indoor navigation. For instance, MobiDev, a software development company, has used AR technology to transform indoor navigation. The company’s ARcore platform can help in recommending the best possible route to the desired destination and displaying it on a mobile device. When it comes to outdoor navigation, AR technology can help travelers in searching for tourist spots and suitable accommodation using AR-based virtual tours. For instance, Hub Hotels by Premier Inn has used AR technology and transformed its rooms into a city map to guide tourists about the tourist attractions nearby. As such, the growing use of AR technology in navigation, and subsequently, the growing demand for AR-based solutions from the incumbents of the travel & tourism industry are expected to drive the growth of the market over the forecast period.
AR technology is evolving continuously in line with the growing adoption of the technology in consumer applications. As a result, the demand for AR chipsets has also been growing. The growing demand for AR chipsets is driving industry-leading firms, such as Qualcomm and NXP, to introduce innovative AR-powered chipsets to meet the changing needs of the end-users. For instance, in January 2022, Qualcomm announced a partnership with Microsoft to produce unique chips for Augmented Reality glasses, which will be compatible for use with Metaverse apps.
Augmented Reality Market Segmentation
Based on the Component Insights, the market is segmented into Hardware, and Software.
The hardware segment accounted for the largest revenue share of 59.8% in 2021 and is expected to continue dominating the market in the forecast period. The growing adoption of AR devices across various industries and industry verticals, such as education, healthcare, construction, and retail, is allowing the hardware segment to dominate the market.
The software segment is expected to value at the highest CAGR of 41.8% in the forecast period. AR technology is penetrating daily life as a result of the outbreak of the pandemic. For instance, the touchless and immersive experience facilitated by AR technology bodes well for both students and employees working from home.
Based on the Display Insights, the market is segmented into Head-Mounted Display & Smart Glass, Head-Up Display, and Handheld Devices.
The head-mounted display & smart glass segment accounted for the highest revenue share of 70.7% in 2021. The segment is expected to continue dominating the augmented reality market in the forecast period as a result of the increasing demand for head-mounted displays and smart glasses in industrial & enterprise applications.
The handheld devices segment is anticipated to value at the highest CAGR of 42.4% from 2022 to 2030. The growth of the segment can be attributed to the rising penetration of handheld devices in retail and e-commerce applications.
The head-up display segment is poised for significant growth in the forecast period. Continued innovations in driver assistance systems are expected to drive the growth of the segment. A driver can drive safely while simultaneously tracking vehicle data, such as speed, turning indicators, and warning signals, on the windshield of the car.
Based on the Application Insights, the market is segmented into Aerospace & Defense, Automotive, Education, E-commerce & Retail, Gaming & Entertainment, Healthcare, Industrial & Manufacturing, and Others.
The industrial & manufacturing segment accounted for the largest revenue share of 24.3% in 2021 and is expected to continue dominating the market in the forecast period.
The healthcare segment is expected to emerge as the fastest-growing segment in the forecast period. AR technology is increasingly being implemented in medical training, surgical visualization, and vein visualization.
The automotive segment is predicted to grow at a CAGR of 43.3% over the forecast period.
Based on the Augmented Reality Regional Insights, the market is segmented into North America, Europe, Asia Pacific, Latin America, and MEA.
North America accounted for the largest revenue share of 33.9% in 2021 and is anticipated to account for a significant market share in the forecast period. The U.S. accounted for the largest share of the North America regional market.
Asia Pacific is predicted to emerge as the fastest-growing regional market in the forecast period. Developed countries, such as Japan and Australia, are gradually paving their path as the leaders in the regional market leveraging a large customer base and advancing the implementation of internet-based platforms.
Market Share Insights:
December 2021: Tencent acquired Turtle Rock Studios. Tencent particularly found the latter’s gaming library and AR capabilities lucrative.
September 2021: WPP and Snap Inc. announced a partnership to explore AR technology to develop advanced immersive experiences for users.
Key Companies Profile:
The augmented reality market can be described as a relatively untapped market, where several opportunities remain unexplored. Vendors are investing aggressively in research and development (R&D) to develop innovative AR solutions for day-to-day applications as well as for enterprises to simplify their workflows and enhance their processes.
Some of the prominent players in the augmented reality market are:
Infinity Augmented Reality Limited
Magic Leap, Incorporated
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