Enterprise hungry partners primed as regional AR / VR spending rises

Enterprise hungry partners primed as regional AR / VR spending rises

Shift represents growth of more than 100 per cent from the previous year

Spending on augmented reality and virtual reality (AR/VR) within Asia Pacific is forecast to reach US$11.1 billion in 2018, as enterprise use cases increase across the region.

Representing growth of more than 100 per cent from US$4.6 billion the previous year, the upward trend bodes well for channel partners currently developed business applications within the market.

Because despite strong adoption of AR and VR technologies across consumer segments, IDC research suggests that in fact, commercial sectors or enterprise will represent more than 48 per cent of spending in 2018.

This figure is expected to overtake the consumer sector in the next five years with 58 per cent share by the end of the forecast period, according to IDC.

“The use cases for both AR and VR are proliferating in the enterprise segment as companies across sectors are developing new IT and business applications,” IDC associate research director of Asia Pacific, Avinav Trigunait, said.

“Many enterprises in the region have already developed solutions utilizing AR and VR such as for design and visualisation, corporate trainings, field maintenance and customer experience and marketing applications.”

In being the largest source of spending however, the consumer sector will continue to drive growth for AR and VR products and services, holding a 51.3 per cent share of overall spending in 2018.

Trigunait said the growth will be primarily driven by the availability of new headsets for VR which will lead to VR consumer spending.

While AR spending will be dominated by the purchase of services – the launch of Augmented Reality SDK platforms from both Google and Apple are also expected to drive spending on application development and games for mobile platforms.

“The availability of new standalone VR headsets such as Oculus Go from Facebook and Mirage Solo from Lenovo is expected to drive adoption as well as content spending in 2018 and beyond,” Trigunait added.

“These headsets will eradicate the need for pairing with PCs or Consoles that used to drive costs higher for AR/VR experiences.”

Commercial sectors

Specific to the channel, each of the five commercial sectors is forecast to register solid growth in spending throughout the forecast period, led by the distribution and services, and public sector.

Distribution and services (US$2 billion) will be the largest amongst the five commercial sectors in 2018, led by the personal and consumer services, retail, and professional services industries.

Across Asia Pacific, the second largest sector will be manufacturing and resources (US$1.7 billion) with balanced spending across the process manufacturing, construction, and discrete manufacturing industries.

Virtual reality games use case have the highest share among all the sectors, garnering a 39.4 per cent share of overall spending in 2018.

Likewise, with the rising hype in the market for augmented reality, there is an expected increment in the market for use cases in different sectors.

In the distribution and services sector, training and retail showcases will be the two largest use cases with a combined spending of more than $329 million in 2018.

Training, industrial maintenance and project management will be the largest use cases in the manufacturing and resource sector. In the public sector, infrastructure maintenance and government training will be the two largest use cases in 2018.

IDC Research
IDC Research

“AR/VR technologies are quickly crossing the chasm with several real-world applications emerging every day in both enterprise and consumer segments,” IDC senior market analyst, Swati Chaturvedi, added.

“Although, the Asia Pacific (excluding China and Japan) adoption is slower when compared with the US or even China markets, the growth trajectory is very promising with enterprises which are utilising AR/VR technologies to accelerate their digital transformation strategies.”

In terms of spending, Chaturvedi said the education industry is expected to top the charts from 2019 till the end of the forecast period out of the 19 industries covered in this spending guide.

“Other key industries driving growth for AR/VR include retail, manufacturing and healthcare,” Chaturvedi added.

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