A new study and infographic by Skilled has come out discussing the eight ways that businesses will be impacted by the emergence of virtual reality (VR) and augmented reality (AR). On this site, we have been writing about the impact of VR and AR in the AEC markets in particular, as well as in other markets like manufacturing and design. But what about the impact on business more broadly?
First—Rapidly Huge Growth in Dollar Value
In 2016 the VR and AR market had revenue in the $5.2 billion range. However, projects for 2020 estimate that the VR/AR market will be drive revenues up to $150 billion. That is nearly 30 times the revenue last year. A big part of that revenue growth will be because the VR and AR markets will go mainstream across the tech industry more broadly with the largest technology companies offering products and services. A prime example of this would be Apple, which today isn’t really shipping a VR or AR product or service of any kind. However, Apple announced its upcoming AR capabilities in future versions of its phones and iOS platform.
Skilled’s report lists six key areas where business applications today will eventually be disrupted by VR or AR or both. These business areas include: (1) training, where businesses and government virtualize training environments rather than implement physical environments for training; (2) conferencing, where data can be viewed and manipulated by everyone in the virtual conference session, as well as hosting the conference meeting in virtual environments you may want to travel to but don’t; (3) remote work, a bit of an extension of the benefits of both items above, where the remote worker can meet up with work partners in a virtualized office-space with their peers; (4) online shopping, where finally the criticism of not being able to truly experience a product gets further addressed; (5) virtual tours, the travel industry is set for disruption wherein virtual tours become both services as well as marketing or aspects of the sale funnel; and (6) design feedback, the area of VR and AR that readers here at Architosh are already familiar at the concept level.
Second—Like the Internet Boom
The research suggests that VR and AR will expand rapidly with new opportunities for both small and big business who get in on the ground floor. There will be first-mover advantages, and yet this is something that has not yet been confidently discussed before insofar as VR and AR in the AEC and manufacturing markets, particularly the former.
The study suggests there will be winners who embrace these two technologies just like those who embraced the web, social media, and mobile as “early adopters.”
And speaking of early adopters, the study, and infographic list and note a few folks we spoke about early on in our journalism on VR and AR here at Architosh. For example, Google’s Project Tango was first shown to us at an AIA National conference years ago, but it is highlighted as a breakthrough technology for VR/AR in 2016.
While VR currently leads AR in growth and advancement, things will change dramatically in favor of AR between now and 2025. The AR market is expected to account for $120 billion annually, compared to $30 billion for VR. So who will be the winners?
At this early stage this will be a tough call. As the infographic makes note, there are over 685 VR startups today with an average valuation of $4.5 million. Yet, there are over 737 AR startups today, with a similar average valuation. In terms of winners in the AEC market, we have already noted at least one in our AIA BEST of SHOW award nods in the past. One of those is irisVR, out of New York. Another company we just wrote about two weeks ago is Finnish company Varjo.