1、1 Virtual reality Augmented reality Hype? Or serious business? 1 Virtual reality Augmented reality Hype? Or serious business? Virtual reality Augmented reality Hype? Or serious business? 2 Virtual reality Augmented reality Hype? Or serious business? Table of contents 1 Introduction 2 What is virtual

2、, mixed other reports used only VR or AR. Furthermore, when forecasting “total VR/AR revenue,” the reports often did not clearly state whether applications and content were included or not. A clear and uniform distinction between all these defi nitions is needed in reports to simplify meta-analysis

3、and prevent contradicting news headlines about the potential of the VR and AR markets. Although it was diffi cult to compare reports from 2016, it was still possible. For 2017, besides copying the numbers of the reports, no additional analysis was possible with the forecasts found. It also was impos

4、sible to compare them with our weighted forecast of last year. Therefore no update of the forecast is given in this report. The studied reports of SuperData, Citi Research and Digi-cap are included in the reference of this report. Nevertheless, we wanted to present an impression of the market based

5、on the available information. First, we will give a short summary of the main fi ndings from our 2016 report1. After that, we will provide an overview of the VR developments in 2016 based on information from SuperData including a market forecast. Unfortunately it is only one source, which increases

6、the risk of misinterpretation. This overview is concluded with an analysis of international AR market developments in 2016. 1 Virtual reality Augmented reality Hype? Or serious business? 10 3.1 FORECAST REPORT In 2016, projections for the international VR/AR-market varied substantially for both the

7、hardware and software markets. Much information was absent, while the available pieces of information often contradicted each other. To obtain a clearer view on the market, we calculated the unweighted averages of the available forecasts of reports from Goldman Sachs, Piper Jaff ray, CCS Insight, AM

8、D, TrendForce and KZero. Hardware Based on this average, the hardware market will increase 20-fold during the period 2015 to 2021. The most explosive year should be 2021 when the average estimate is for 82.5 million headsets shipped nearly double the expected 42.9 million in 2020. Graph 1 Worldwide

9、VR/AR headset shipments (2015- 2025). Source: Market survey 2016. Software The future of the software market is unclear since reports on VR and AR were not always consistent in their usage of the defi nition. Based on the unweighted average of the aforementioned projections, this market will grow mo

10、re than 20-fold from $1.1 billion in revenue in 2016 to $24.3 billion in 2020. The fi rst big software markets will be in videogames and entertainment. The expected exponential growth is based on the assumption that the software market will only truly develop if the hardware market has established i

11、tself. 11 Virtual reality Augmented reality Hype? Or serious business? Graph 2 Projected worldwide VR/AR software revenue (2016-2020). Source: BOM report 2016. Goldman Sachs expects the following nine sectors to drive the software market: videogames, live events, video entertainment, healthcare, rea

12、l estate, retail, education, engineering and defense. The three biggest markets in both 2020 and 2025 will be entertainment, healthcare and engineering. Graph 3 Worldwide VR/AR software revenue forecast by sector (Goldman Sachs, 2016). Virtual reality Augmented reality Hype? Or serious business? 12

13、3.2 HOW DID THE VR MARKET PERFORM IN 2016? In this section, we compare the projections of research group SuperData in the fi rst quarter of 2016 with the actual sales data given by the same research group at the end of 2016. Oculus Rift Despite high expectations and lots of media coverage, the Oculu

14、s Rift has not yet lived up to the positive forecasts from recent years. Oculus, which was purchased by Facebook in March 2014, encountered unexpected component shortages in early 2016, which led to delayed shipment dates for early adopters. The cost of VR may also be hampering sales because a consu

15、mer must also own a high-end gaming personal computer of at least a thousand euros For example, UK adults are only ready to spend 158 for a virtual reality device, according to The Foundry, a global software company. Both the delay and the cost have resulted in fewer headset shipments than was proje

16、cted. HTC Vive The HTC Vive stands out as the leading headset as evidenced by developers working on their next games. With 420,000 units shipped, the HTC Vive has outperformed its own projections and outsold the Oculus Rift. These numbers show that there is a demand for the Vive, despite the require

17、ment for an expensive PC. Analysts debate whether the HTC Vive outsold the Oculus Rift because of the latters component shortages or shipment issues or other problems. Google Daydream Based on reports from SuperData, Google sold 260,000 Daydream Views in 2016. However, Androids built-in statistics f

18、or apps shows that the software for these units did not sell well; a lot of Daydream apps had not yet passed 5,000 installs as of this writing. According to various reports and market analyses, a lack of compelling content was to blame. People using Daydream-ready phones/headsets were watching about

19、 40 minutes per week, Googles VP of VR recently said. Samsung Gear VR While VR hardware sales were off to a slow start, Samsung Gear VR outperformed projections by shipping at least one million more units than was initially expected. At CES 2017, Samsung Electronics America President Tim Baxter said

20、 the company has sold 5 million Gear VRs to date. Samsung bundles its mobile business with the Gear VR in certain smartphones. This way, their product appealed to mainstream consumers as well as to tech enthusiasts and core gamers. Additionally, the Gear VR was priced far lower than HMDs like the Oc

21、ulus Rift and the HTC Vive; Samsung even gave away Gear VRs for free to new Galaxy owners in 2016. 13 Virtual reality Augmented reality Hype? Or serious business? PlayStation VR The number of PlayStation VR shipments was disappointing compared to projections. SuperData predicted 2.6 million PlayStat

22、ion VRs would ship in 2016, but Sony only sold 750,000. The main reasons for the delay of the headset were technical issues and supply problems. A lack of compelling content also slowed sales. The most popular games on the PlayStation 4 are fi rst-person type games like Call of Duty and Battlefi eld

23、 that dont translate well to virtual reality gaming due to problems with nausea. About 12% of VR users indicated the technology made them feel sick. Graph 4 Projected only 65% of the original projection. The PC and console platform showed disappointing sales numbers, mainly caused by the delayed shi

24、pments and insuffi cient supply of the Oculus Rift and PlayStation VR. The mobile platform outperformed its forecasts, mainly due to the Samsung Gear VR, which sold a million more units than projected by SuperData. SuperData also made an update in Q1 2017 about its forecast of the total VR market. I

25、n Graph 6, the forecast of 2016 and 2017 are compared, giving an interesting view. The forecast for 2017 is 15% lower than in 2016. The forecast for 2018 and 2019 are higher than in 2016 while the forecast for 2020 has been cut by 7%. 15 Virtual reality Augmented reality Hype? Or serious business? G

26、raph 6 Projected worldwide VR revenue (SuperData, Q1 2016 the launch years issues resulted in only $2.7 billion VR revenue. This was counterbalanced by Pokmon GOs outperformance helping AR to an unexpected $1.2 billion revenue, for a total $3.9 billion VR/AR market in 2016 (we were 11 percent optimi

27、stic).” Compared to VR, AR is missing the infrastructure to build the tools, platforms and content. The current generation of smart phones and tablets are capable of handling AR technology. The problem that prevents a large-scale adoption of AR is that for each AR interaction, an app like Pokmon Go

28、has to be downloaded. Native support on smart phones and tablets is required to create the infrastructure for mass adoption of AR. Virtual reality Augmented reality Hype? Or serious business? 16 Here is an analysis of what top tier tech companies are doing: Apple Based on patent fi lings, Apple has

29、been investigating virtual and augmented reality technologies for more than 10 years. It is rumored that Apple has teamed with Carl Zeiss to develop a pair of smart glasses, which will include mixed/augmented reality functionalities. Tim Cook, Apples Chief Executive Offi cer, has stated that the com

30、pany will continue to invest in augmented reality and that the company is ”high on AR in the long run.” If Apple launches AR glasses, it is likely the company will include AR support in IOS. Business Case Gemvision creates a platform that helps all business sectors optimize processes by using augmen

31、ted reality glasses or smart glasses. This platform gives support to a technician on-site, providing all the necessary information and the possibility of a video conference with colleagues from around the world so they can see what the on-site engineer is doing. These features give the possibility o

32、f live and virtual training for technicians or engineers. Gemvision can supply insights of big data solutions with real-time data. Google In 2016, Google offi cially launched Tango, which integrates native AR support in Android, the largest operating system for smartphones. Based on this technology,

33、 Lenovo unveiled its fi rst phone with native support for AR in November 2016 and announced a second phone in 2017. Other manufacturers like Asus are also announcing smartphones with Tango support this year. Another way to use augmented reality is through glasses like the Google Glass introduced in

34、2014. The introduction was too early and the project offi cially stopped in early 2015. Rumors say Google is still developing the Google Glass, mainly for industrial purposes. Besides Google, other manufactures like Epson, ODG and Vuzix are developing AR glasses. For pilot purposes, these glasses ar

35、e good enough. But for implementation in production environments, the glasses have disadvantages like comfort, battery life and display angle. Two interesting companies to watch in 2017 are Microsoft HoloLens, which brings high- defi nition holograms to life in your world, and Magic Leap, which feat

36、ures magical images like whales jumping out of the fl oor of a gymnasium. 17 Virtual reality Augmented reality Hype? Or serious business? Microsoft HoloLens The HoloLens is a mixed reality device, according to Microsoft, which describes it as follows: “Microsoft HoloLens is the fi rst self-contained

37、, holographic computer, enabling you to engage with your digital content and interact with holograms in the world around you.” The HoloLens was launched in 2016 in America. Its currently a developer version and not available for the consumer market. Before unveiling a consumer version, Microsoft wan

38、ts more information about how the device will be used by businesses, potential markets and minimum requirements for device adaptation. Magic Leap Magic Leap is a stealth startup, but it has received attention to the tune of $1.4 billion in investments from companies like Alibaba, Google and Warner B

39、ros. The company currently doesnt have a product on the market. Rumors suggest the fi rst market launch sometime in 2017. The product might include a new type of computing platform and a device that can create an AR experience never shown before. Whatever the product might be, the amount of the inve

40、stment by the tech worlds biggest players indicate that Magic Leap might have a huge impact on the market. Virtual reality Augmented reality Hype? Or serious business? 18 4 Market research As we remarked in Chapter 3, there wasnt much data to track international developments in the VR and AR markets

41、. Emerging markets often have this problem of inconsistent data. Nevertheless, it is important for VR and AR startups, investors, end users and government bodies to gain insight into market developments to defi ne their strategies, reach customers, secure investments and create policies to stimulate

42、 the VR/AR market. In this chapter, the market development in the period 2016-2017 is described with a focus on international engineering, manufacturing and industry. 4.1 RESEARCH VERIFICATION More than 600 respondents participated in our research; we made a clear distinction between developers of V

43、R and AR hardware, software and content on the one hand, and users of VR/AR on the other. Interestingly, more respondents, 14%, indicated they see no use for VR and AR, a 5% increase compared with 2016. A possible explanation is that respondents showed more familiarity with the fi eld and a growing

44、percentage was not impressed by its possibilities. 86% of the respondents think AR/VR is useful for their businesses compared to 91% in 2016 In Visual 3, one can see that the majority of the respondents were concentrated around Rotterdam (19) and the Eindhoven region (42). The remaining participants

45、 were distributed across the Netherlands, Belgium and Germany. The research was done in sectors and with companies that are widely recognized to have an international presence and supply chain. Therefore this research provides an indication of the industrys international market development. BELGIUM

46、GERMANY Rotterdam Amsterdam NETHERLANDS Eindhoven 1 1 1 1 1 1 1 1 1 11 1 4 4 4 2 2 2 5 5 3 3 7 9 9 19 42 3 3 6 6 Visual 3 The known geographic locations of the developers/users of VR/AR who participated in the market research. Their location was an optional question in the survey, which explains why

47、 the total number of respondents is higher than the sum of the numbers shown in this visual. 19 Virtual reality Augmented reality Hype? Or serious business? The purpose of this research is to compare the results of our 2016 and 2017 reviews to gain insight into market developments. To make a valid c

48、omparison, the respondents in both years needed similar characteristics such as user or developer. Graph 7 shows which sector the users (the demand side) are active in. Of the users who participated in the survey, 45% operated in the industry sector, an 18% increase from 2016. Correspondingly, the “

49、other” sector decreased by 14%. Last years respondents in the “other” sector indicated they were active in manufacturing or industry. To improve the research, we specifi ed the manufacturing, engineering and industry sector as one market (Industry) in the 2017 questionnaire. Other than that, the respondents in both years had similar characteristics. Graph 7 Users: in what sector are you currently employed? Virtual reality Augmented reality Hype? Or serious business? 20 When we compare the sectors be