Global augmented reality and virtual reality (AR/VR) headset market grew significantly last year led by all-in-one VR solutions like Meta’s Oculus Quest 2.
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Worldwide AR/VR headset shipments expanded 92.1% to 11.2 million units in 2021, compared to the previous year, with Meta’s Quest 2, capturing 78% share of the combined AR/VR market during the year, according to a report by research firm IDC.
“Meta has led the AR/VR industry by offering a very accessibly priced headset and by moving beyond the core gaming audience, piquing the interest of non-gamers as well as businesses,” Jitesh Ubrani, Research Manager at IDC, said in a statement.
While Oculus took the top spot in the AR/VR headset market, two Chinese companies DPVR and ByteDance’s Pico also performed well during 2021. DPVR, which has had plenty of success in Asian markets and captured 5.1% share globally, and Pico bagged the third position with 4.5% share of the market. VR pioneer HTC and China-based online video platform iQIYI completed the top five companies.
Pico, like DPVR, is well-positioned in Asian markets but has also done well in North America and Western Europe where it has helped fill the void left when Meta discontinued its Oculus Go, IDC noted.
What lies ahead
“The company [Meta] still lacks major competitors though that will likely change over the course of the next twelve to 18 months when Sony will re-enter the space with the PSVR2, and we continue to expect headsets from the likes of Apple and other smartphone vendors to eventually launch and garner a lot of attention from end-users,” Ubrani said.
According to IDC, the headset shipments are projected to grow 46.9% year-over-year in 2022 and experience double-digit growth through 2026 as global shipments of AR/VR headsets surpass 50 million units by the end of the forecast with a 35.1% compounded annual growth rate.
The firm further added that the discussion of the Metaverse is driving hype—and investment—around AR, VR, and a host of adjacent technologies, but it doesn’t expect this frothy behaviour to impact headset volumes any time soon.
Market leader Facebook, which rebranded itself as Meta, is focusing on bringing the metaverse, an immersive digital realm, to life. It intends to move beyond 2D screens toward immersive experiences like augmented and virtual reality, and is making investments in this area.