Posted by Singapore: AR and VR IT spending expected to grow rapidly in the Asia Pacific (APAC) to reach $28.8 billion by 2024. The worldwide AR (augmented reality) and VR (virtual reality) IT spending as per IDC forecast in the APAC excluding Japan is growing at a compound annual growth rate (CAGR) of 47.7% (2019-2024).
The AR and VR technology capabilities are primarily driving the growth with it ability in addressing different industries issues in current COVID-19 scenario. And that is creating huge opportunities during the forecast period.
“The restrictions imposed due to the pandemic urged many organisations to rely on technologies to support their business processes/functions such as customer service, remote health, and minimized in-person meetings among others,” said Ritika Srivastava, Associate Market Analyst – IDC Asia/Pacific.
“With this, there was strong new demand across many industries for AR and VR technology in the market – especially in the second half of 2020,” added Srivastava.
Commercial segment surpassed consumer AR and VR IT spending last year and will continue to account for a larger share of the spending. However, consumer spending is also forecast to grow significantly with a 43.2% CAGR between 2019 – 2024.
The Education sector, which massively has moved online with virtual teaching for students during the Covid-19 pandemic, is leading the most projects/implementation in Asia/Pacific. Closely followed by Retail and Discrete Manufacturing – the three industries encompass close to 50% of the overall commercial sector in 2020.
Banking (313.7% CAGR) followed by Federal/Central Government, Healthcare Provider, and Securities and Investment Services are accelerating the momentum into the new use cases and are profitable in terms of ROI optimization.
Use-cases that participated in practical tasks with the support of the AR for executing tasks like training have an abundance of impulse within the industries.
VR games are a leading use case in 2020, with more than one-third of the overall AR and VR technology market being one of the top entertainment sources in 2020 – owing to the limitations of physical interaction due to pandemic.
This is followed by training and video/feature viewing (VR) use cases. However, emergency response and internal videography are the fastest-growing use cases in terms of compound annual growth rate over the forecast (2019-2024).
From a technology standpoint, hardware including host devices and viewers will contributes to almost two-thirds of overall AR and VR IT spending by 2024 – dipping in share as software and services gain momentum.
Services spending will see strong growth across the forecasted period (CAGR 62.4%) for systems integration. Followed by custom application development and consulting services, while software spending will have a CAGR of 63.8%.
From the two reality types of perspective, spending in VR solutions will be greater than that of AR solutions initially. Though, strong growth in AR hardware, software, and services spending (118.0% CAGR) will push overall AR spending well ahead of VR spending by the end of the forecast period 2019- 2024.
During the pandemic, the augmented technology showed great potential and played a critical role in digital transformation (DX) efforts of many organizations across industries. Doctors using mixed reality to solve several problems during the on-going pandemic were among the focus areas of investments in augmented technology.
In addition, remote working, virtual events, and more augmented customer engagement use cases will bring demand for implementing AR/VR technology in future.
“With customer and employee engagement gaining prominence, spending intent on AR/VR is rapidly accelerating. Organizations need to develop a vision and devise a resilient strategy for deploying AR/VR as enablement tools to achieve strategic priorities,” addsed Deepan Pathy, Research Manager, Future of Work, AR/VR and Mobility Research – IDC Asia/Pacific.
As organisations plan their return to workplace strategies, ensuring a safe workplace for employees will be a top of agenda item for business leaders and creating a contactless/touchless workplace environment will be crucial.
AR/VR will be a key enabler in creating a workplace that can minimise person-to-person interaction, with initiatives such as virtual conferences, enable remote support and device management, AR aided retail shopping, etc.
On a geographic basis, China market will represent the largest AR/ VR IT spending in the Asia/Pacific region. With more than 90% share in 2020 and spending is projected to take off at a five-year CAGR of 47.1% over the forecast period (2019-2024).