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Home ➤ Information and Communications Technology ➤ Extended Reality Market
Extended Reality Market
Extended Reality Market
Published date: June 2023 • Formats:
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  • Home ➤ Information and Communications Technology ➤ Extended Reality Market

Global Extended Reality Market By Component (Hardware, Software, and Service), By Technology (AR, VR, and MR), By End-User (Online and Offline), By End-User (Gaming, Retail, Healthcare, Manufacturing, Media & Entertainment, Education, Aerospace & Defense, and Other End-Users), By Region and Companies - Industry Segment Outlook, Market Assessment, Competition Scenario, Trends and Forecast 2023-2032

  • Published date: June 2023
  • Report ID: 102359
  • Number of Pages: 230
  • Format:
  • Overview
  • Table of Contents
  • Major Market Players
  • Request a Sample
  • Quick Navigation

    • Report Overview
    • Driving Factors
    • Restraining Factors
    • COVID-19 Impact Analysis
    • By Component Analysis
    • By Technology Analysis
    • By End-User Analysis
    • Global Extended Reality Key Market Segments
    • Growth Opportunities
    • Latest Trends
    • Regional Analysis
    • Key Regions and Countries Covered in this Report
    • Market Key Players

    Report Overview

    In 2022, the global extended reality market was valued at USD 37.9 Billion. Between 2023 and 2032 this market is estimated to register the highest CAGR of 30.8%.

    Extended Reality (XR) also known as mixed, virtual, and augmented reality is a combination of these technologies. This cutting-edge technology allows users to interact more naturally & intuitively with a computer-generated environment. Gaming is the biggest consumer of XR but applications in healthcare & education are also growing rapidly.

    The COVID-19 pandemic which has affected millions of people worldwide has accelerated the use of XR technologies for remote work & virtual events. As XR continues to improve and becomes more accessible it is expected that the market will surge even further. This will open up new possibilities for consumers & businesses.

    Extended Reality Market

    Driving Factors

    Increasing Popularity of AR and VR in the Gaming Industry

    The global extended-reality (XR) industry is driven by numerous factors which include technological advances, the increasing demand for virtual reality & augmented reality apps and the growing acceptance of XR across various industries. New hardware and software such as powerful processors and improved graphics capabilities are allowing XR to become more immersive driving demand both from consumers and businesses.

    The XR market is also growing due to the popularity of virtual and augmented realities in industries like gaming, healthcare, and education. The COVID-19 epidemic has also accelerated the adoption of XR technologies for remote work and virtual events further driving market growth.

    Restraining Factors

    Privacy and Security Concerns Hinder the Market Growth

    Despite the rapid growth of the global extended-reality (XR) industry, several factors may limit its expansion. The excessive cost of XR software & hardware can be a barrier to adoption for some consumers and businesses. A second challenge is the requirement of technical expertise to develop and implement XR apps which can be a barrier for some companies.

    As users become more aware of the potential risks of these technologies, privacy and security concerns in virtual and augmented reality applications may also slow down the growth of the XR industry. The lack of standardized platforms for XR development may also slow the growth of the market as it makes it harder to create & share apps across different platforms.

    COVID-19 Impact Analysis

    The COVID-19 Pandemic has had an impact on the global extended-reality (XR) industry both in terms of its growth & types of applications that are being developed. XR technology is becoming more important to facilitate remote collaboration and virtual events, especially with social distancing measures & many people now working remotely. The pandemic also sparked a surge in virtual healthcare, education, and shopping applications.

    The pandemic also sparked the development of new XR training and simulation applications such as virtual training for frontline workers. The pandemic also had some negative effects on the XR industry such as delays & disruptions in the supply chain.

    By Component Analysis

    The Software Segment is Dominant

    Based on components, the market for extended reality is segmented into hardware, software, and services. Among these, the software segment is the most lucrative in the global extended reality market, with a projected CAGR of 31%. The total revenue share of the software segment is 65% in 2022.  The dominance of this segment can be attributed in part to the wide-scale adoption of extended reality technologies such as augmented, virtual, and mixed realities.

    Retail stores like IKEA or Walmart use ARNR applications in order to enhance their customers’ shopping experiences. ARNR gaming apps are also gaining popularity which is increasing pressure on software developers to create innovative & advanced gaming applications. This will support the market growth in the coming years.

    By Technology Analysis

    AR Technology is Dominant in Global Extended Reality Market

    By technology, the market is further divided into AR, VR, and MR. AR (Augmented Reality) technology is estimated to be the most lucrative segment in the global extended reality market, with a market share of 55% and a projected CAGR of 29.9%, in 2022. AR technology involves overlaying virtual information in the real world. The convenience and versatility of AR technology are the main reasons for its popularity. It can be accessed easily through a mobile phone & does not require any additional hardware.

    AR technology is also utilized in a huge range of industries which include retail, healthcare, and entertainment. This makes it a popular option for businesses that want to integrate XR. Virtual reality (VR) & mixed reality (MR) are also gaining traction, especially in industries like gaming & immersive training. As the XR industry continues to grow we can expect a diversification in technologies & applications.

    By End-User Analysis

    The Gaming Segment is Dominant

    Based on end-user, the market is segmented into gaming, retail, healthcare, manufacturing, media & entertainment, education, aerospace & defense, and other end-users. Among these end-users, the gaming segment is estimated to be the most lucrative segment in the global extended reality market with the largest revenue share of 45% and a projected CAGR of 33.4% during the forecast period.

    The immersive and shared experience offered by XR has made it a popular choice for both game developers & players. XR gaming’s popularity is largely owing to its ability to provide a more immersive & engaging gaming experience. It also has the ability to enable new forms of gameplay & social interactions.

    Extended Reality Market

    Global Extended Reality Key Market Segments

    Based on Component

    • Hardware
    • Software
    • Service

    Based on Technology

    • AR
    • VR
    • MR

    Based on End-User

    • Gaming
    • Retail
    • Healthcare
    • Manufacturing
    • Media and Entertainment
    • Education
    • Aerospace and Defense
    • Other End-Users

    Growth Opportunities

    Powerful Processors and Improved Graphics Allow an Immersive XR Experience

    The global extended-reality (XR) industry offers many growth opportunities to businesses and investors. The continued adoption of XR technologies in various industries such as gaming and healthcare, education, and retail is a key growth opportunity. The market for XR is expected to grow as these industries continue exploring the potential of XR & developing new applications. The development of new hardware technologies and software that enhance the capabilities and enable new applications of XR devices is another growth opportunity.

    For example, more powerful processors and improved graphics capabilities could allow for more immersive XR experiences. The growing interest in XR technologies among consumers & businesses has led to increased investment and innovations in the XR eco-system which will drive further growth.

    Latest Trends

    Integration of Technologies Such as AI, 5G Networks, and Blockchain

    The global extended-reality (XR) industry is constantly evolving. New trends emerge as technology advances and new applications are discovered. The use of XR for virtual events & remote collaboration is one of the newest trends in the XR industry. The COVID-19 pandemic is accelerating the adoption and use of virtual experiences and remote work. XR technology can be used to create immersive and engaging virtual environments at meetings, conferences, or other events.

    Another trend is to develop XR applications in healthcare, especially for mental health and therapies. XR technology can be used to create immersive & interactive therapy experiences which can help patients overcome their phobias, reduce stress and improve their mental well-being. There is a growing trend to use XR technology in training and simulations, especially in industries like manufacturing & construction. XR is also being integrated with other emerging technologies like artificial intelligence, 5G networks, and blockchain. This could lead to new applications & use cases for XR in the future.

    Regional Analysis

    North America is Dominant Region in the Global Extended Reality Market

    North America is anticipated to be the most dominant region in the global extended reality market with the largest market share of 40% and is projected to register a CAGR of 32.2% during the forecast period. North America’s extended reality market is surged by the increasing use of smartphones, the adoption of smart devices, the deployment of 5G, & the demand for extended technology in different applications.

    According to Telefonaktiebolaget LM Ericsson, it is estimated that North America’s 5G penetration rate will surpass 90% by 2028.

    Extended Reality Market

    Key Regions and Countries Covered in this Report

    • North America
      • The US
      • Canada
      • Mexico
    • Western Europe
      • Germany
      • France
      • The UK
      • Spain
      • Italy
      • Portugal
      • Ireland
      • Austria
      • Switzerland
      • Benelux
      • Nordic
      • Rest of Western Europe
    • Eastern Europe
      • Russia
      • Poland
      • The Czech Republic
      • Greece
      • Rest of Eastern Europe
    • APAC
      • China
      • Japan
      • South Korea
      • India
      • Australia & New Zealand
      • Indonesia
      • Malaysia
      • Philippines
      • Singapore
      • Thailand
      • Vietnam
      • Rest of APAC
    • Latin America
      • Brazil
      • Colombia
      • Chile
      • Argentina
      • Costa Rica
      • Rest of Latin America
    • Middle East & Africa
      • Algeria
      • Egypt
      • Israel
      • Kuwait
      • Nigeria
      • Saudi Arabia
      • South Africa
      • Turkey
      • United Arab Emirates
      • Rest of MEA

    Market Share & Key Players Analysis

    Microsoft, Google, and Apple are the key players in the XR Market. Other key players include Samsung, HTC, Sony Qualcomm, Magic Leap, and Unity Technologies. These companies invest thoroughly in research & development to enhance their XR service, improve the user experience, and expand their reach. The XR industry is driven by the increasing demand from different industries such as gaming, healthcare & education.

    Market Key Players

    • Qualcomm Technologies Inc.
    • Accenture PLC
    • SoftServe Inc.
    • SphereGen Technologies LLC
    • Northern Digital Inc.
    • Microsoft Corporation
    • Softweb Solutions Inc. (Avnet Inc.)
    • Tata Elxsi Limited
    • Varjo Technologies Oy
    • Talespin Reality Labs Inc
    • Other Key Players

    Recent Developments

    • HTC Corporation will launch the VIVE XR Elite in January 2023. It is its latest consumer flagship. This lightweight & compact headset combines mixed reality (MR) & virtual reality (VR) to create a powerful and versatile experience. It is an immense choice for numerous activities which include gaming, productivity, and fitness.
    • Samsung Electronics Co., Ltd. will launch Dreamground, a new AR experience in November 2021, aimed at encouraging creative thinking & discovery. This innovative concept combines physical structures with customized AR features and on-screen animation, giving users both a physical and digital playground.

    Report Scope

    Report FeaturesDescription
    Market Value (2022)USD 37.9 Bn
    Forecast Revenue (2032)USD 519.5 Bn
    CAGR (2023-2032)30.8%
    Base Year for Estimation2022
    Historic Period2016-2022
    Forecast Period2023-2032
    Report CoverageRevenue Forecast, Market Dynamics, COVID-19 Impact, Competitive Landscape, Recent Developments
    Segments CoveredBy Device Type (AR Devices, VR Devices, and MR Devices), By Components (Hardware, Software, and Service), By End-User (Online and Offline), By End-User (Gaming, Retail, Healthcare, Manufacturing, Media & Entertainment, Education, Aerospace & Defense, and Other End-Users)
    Regional AnalysisNorth America – The US, Canada, & Mexico; Western Europe – Germany, France, The UK, Spain, Italy, Portugal, Ireland, Austria, Switzerland, Benelux, Nordic, & Rest of Western Europe; Eastern Europe – Russia, Poland, The Czech Republic, Greece, & Rest of Eastern Europe; APAC – China, Japan, South Korea, India, Australia & New Zealand, Indonesia, Malaysia, Philippines, Singapore, Thailand, Vietnam, & Rest of APAC; Latin America – Brazil, Colombia, Chile, Argentina, Costa Rica, & Rest of Latin America; Middle East & Africa – Algeria, Egypt, Israel, Kuwait, Nigeria, Saudi Arabia, South Africa, Turkey, United Arab Emirates, & Rest of MEA
    Competitive LandscapeQualcomm Technologies Inc., Accenture PLC, SoftServe Inc., SphereGen Technologies LLC, Northern Digital Inc., Microsoft Corporation, Softweb Solutions Inc. (Avnet Inc.),Tata Elxsi Limited, Varjo Technologies Oy, Talespin Reality Labs Inc, Other Key Players
    Customization ScopeCustomization for segments, region/country-level will be provided. Moreover, additional customization can be done based on the requirements.
    Purchase OptionsWe have three licenses to opt for: Single User License, Multi-User License (Up to 5 Users), Corporate Use License (Unlimited User and Printable PDF)

     

    Frequently Asked Questions (FAQ)

    What is the extended reality (XR) market?

    The extended reality market refers to the collective market for technologies that merge the physical and virtual worlds, including virtual reality (VR), augmented reality (AR), and mixed reality (MR).

    What are some key applications of extended reality?

    Extended reality has applications in various industries, including gaming, entertainment, healthcare, education, manufacturing, and retail. It can be used for immersive gaming experiences, virtual training simulations, architectural visualization, medical diagnostics, and more.

    What are the major factors driving the growth of the extended reality market?

    The growth of the extended reality market is primarily driven by advancements in technology, increasing adoption in various industries, rising demand for immersive experiences, and the availability of more affordable and accessible XR devices.

    What are the main challenges faced by the extended reality market?

    Some challenges include high costs of hardware and development, technical limitations like battery life and processing power, concerns regarding privacy and data security, and the need for more compelling content and applications to drive widespread adoption.

    Extended Reality Market
    Extended Reality Market
    Published date: June 2023
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    • Qualcomm Technologies Inc.
    • Accenture plc Company Profile
    • SoftServe Inc.
    • SphereGen Technologies LLC
    • Northern Digital Inc.
    • Microsoft Corporation Company Profile
    • Softweb Solutions Inc. (Avnet Inc.)
    • Tata Elxsi Limited
    • Varjo Technologies Oy
    • Talespin Reality Labs Inc
    • Other Key Players
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