“VR will be big, AR will be bigger and take longer.” What sounded revolutionary when we first said it 2 years ago has become accepted wisdom. But now the market has actually launched, we’ve got 12 months of real world performance and major tech players’ strategies emerging. And that’s changed our views on VR/AR growth. A lot. Our new Augmented/Virtual Reality Report 2017 base case is that Mobile AR could become the primary driver of a $108 billion VR/AR market by 2021 (underperform $94 billion, outperform $122 billion) with AR taking the lion’s share of $83 billion and VR $25 billion.
If you haven’t heard about VR/AR by now, your desert island must not have wi-fi. But there are millions of folks who know about VR/AR who haven’t seen it yet. User trial is on the critical path for VR/AR to go mass market. So what are the lessons from previous digital platforms about moving mass consumers from awareness to trial?
Virtual, augmented and mixed reality have a competition problem.
But while most AR/VR companies will tell you how much better they are than their nearest direct competitor, they’re picking the wrong fight. The main event isn’t between Oculus, HTC, Sony, Samsung and Google for VR, or Microsoft, Magic Leap, Meta and ODG for AR (including mixed reality). There are far bigger and scarier competitors out there.
Digi-Capital’s new 200+ page Games Report Q3 2016 found that games investments, M&As and stock markets have delivered a massive turnaround after last year’s games deals ice age. So far this year games investments have hit $1.6 billion, mergers & acquisitions $25.7 billion, with Digi-Capital’s global games stock market index up 17% in the last 12 months. After 2015’s worst games deals market in a decade, the rebound so far this year has been unprecedented. If Netmarble’s proposed IPO ends the games IPO drought of the last 2 years, 2016 could be the largest single year for games deals in history.