• Most VR spending came from the consumer industry
• Web3, metaverse, top drivers that will drive new business priorities

According to the latest release of IDC’s Worldwide Augmented and Virtual Reality Spending Guide, Asia/Pacific spending on AR/VR solutions is expected to capture net spend of $14.8 billion (RM65 billion) by 2026, growing at a CAGR of 40.1% (2021 -2026).

In a statement, the research firm said that a large share of VR spending came from the consumer industry, which is expected to show a similar trend over the forecast period.

However, growing opportunities for commercial use cases such as training, collaboration, and metaverse-related activities are expected to offer promising avenues for growth, he added.

IDC has said in the past that the design and troubleshooting needs of enterprises have been met with AR solutions that will continue through the forecast period.

However, new devices launched by various vendors in the later forecast years are expected to serve the consumer market with new opportunities for personal productivity and entertainment needs, it added.

Lily Phan, Future of Work, Research Director at IDC Asia/Pacific, said AR/VR technology is set to transform the way we live, work and play.

“Technology has opened up new opportunities for gaming, entertainment, consumer, healthcare, manufacturing, education and many more.

“As the technology becomes more refined and the metaverse becomes more integrated into the future of work, AR/VR spending will experience strong growth rates of up to 40% in the coming years,” Phan said.

According to the report, discrete manufacturing, education, professional services, healthcare providers, and personal and consumer services captured more than 66% of total spending in 2022 among the 19 business industries covered by IDC.

He said training emerged as the top use case for discrete manufacturing, healthcare, and consumer and personal services in 2022.

Professional services showed the highest CAGR of 41.5% due to the growing need to engage in more effective collaboration, enabling sharing and interaction across the enterprise, he added.

The report stated that healthcare also showed a similar trend for collaboration use cases and is expected to generate spending of US$44.7 million (RM196 million) by 2026.

It said that 360-degree educational video viewing (post-secondary) emerged as the most promising use case during the forecast period, capturing a CAGR of 48.1%.

He added that AR/VR technology will offer a greater immersive learning experience by enabling the virtualization of information, thus developing innovation, problem-solving, and analytical thinking skills.

Also, the arrival of the metaverse offers a boost to the AR/VR market.

AR/VR technology, along with AI, cloud and blockchain, will be used to impact six major markets, namely entertainment, social, education, finance and work, the research showed.

He added that the technology investments made by Meta in recent years in AR/VR technology and the lack of competitive rivalry are expected to promote other companies such as Sony, Apple and Pico to enter the AR/VR market in the later years of the forecast. period, thus offering promising growth opportunities for new players and diverse options for consumers.

“Web3 and the metaverse are acting as primary drivers that, in turn, drive new business priorities,” said Abhik Sarkar, IDC Asia/Pacific market analyst.

“The entertainment industry will likely bear the brunt as virtual entertainment becomes more polarized. The development of the metaverse will also help improve marketing and the digital economy, as e-commerce will continue to show accelerated growth due to the immersive and comprehensive customer experience,” he added.

The report indicated that services captured the most spending in 2022 at 34.4%, closely followed by hardware and software.

He said that the hardware segment is expected to dominate the market by 2026 and can capture a total spend of $8.2 billion (RM36 billion).

He added that the segment is also expected to grow at a CAGR of 44.8% (2021-2026).