The global Mobile AR and smart glasses market is expected to grow to 2.5 billion installed base and be worth $75 billion by 2023. But the VR market is expected to hit only 30 million installed bases and be worth $15 billion by the same time. Why are these 2 markets so different?
Mobile AR is the mass consumer market
Mobile AR looks to be the the mass market for AR/VR, with many free software platforms like ARKit, ARCore, Facebook and snapchat.
The challenge for mobile AR is to transform user experiences to increase user frequencies with their mobile devices.
Ecommerce could be a potential game changer for mobile AR. Use of AR in ecommerce has already given returns for Houzz (11 times sales uplift), Olay Skin Advisor (5 million customers, double conversion, 30% higher basket sizes, biggest product launch in 10 years with Olay Whips) and Walmart.
Smartglasses are a medium-term hardware/enterprise product
Smartglasses have been targeted for enterprises so far. Digi-capital forecasts enterprises smart glasses to scale up to millions of users by 2023.
Apple could come into the AR smartglasses market by 2023, but it still remains to be seen when they will be officially launched.
The primary revenue driver for smartglases looks to be hardware sales and enterprise software for the medium term.
VR for early-adopter consumers and enterprise
VR had less than 20 million installed bases in 2018. This year, with the launch of Oculus Quest and Nintendo Switch VR, that number will increase by a few million bases.
Most of the revenue in VR is currently from hardware sales and games/entertainment, and this looks to be the main revenue streams in the medium term.
One platform to rule them all
The long term vision is a unified AR/VR platform, but for the medium term divergence seems like the trend for the next generation of tech giants to emerge,