The VR market, once seen as the future of gaming and entertainment, has encountered setbacks in recent years. Analysts attribute this to factors like reduced spending on VR content and a lack of exciting game releases.
According to research by Omdia, spending on VR content dropped from $934 million in the previous year to $844 million in 2023. This decline can be partly attributed to the market losing momentum after peaking during the pandemic in 2021. Additionally, the introduction of new gaming hardware options in 2024 has made VR headsets less of a priority for gamers.
The disappointing performance of key headsets like the Meta Quest 3, Sony PlayStation VR2 (PSVR2), and Pico 4 has also played a role in the market’s downturn. PSVR2 has suffered from a lack of compelling games and Sony’s focus on expanding PlayStation 5 peripherals. ByteDance’s reduced commitment to VR has affected its Pico brand, leading to project cancellations and a shortage of competitive content.
Inflationary pressures have further reduced consumer spending, making it less likely for potential VR enthusiasts to invest in expensive hardware and content. Except for Meta, major tech companies have shown little interest in VR technology, contributing to the industry’s expected decline over the next two years.
Despite these challenges, analysts predict a gradual recovery for the VR market, with content revenues projected to reach $2.3 billion by 2028. The industry is hopeful for a resurgence in 2026.
One potential game-changer is the launch of the Apple Vision Pro in 2024. Although its impact may not be felt until 2026, this product has the potential to shake up the market and create new growth opportunities. Additionally, despite Meta’s limited AR content and the high price of the Quest 3, the company remains a key player in the VR industry.
It’s worth noting that while sales of VR headsets declined by 24% in 2023, dropping to 7.7 million units compared to 10.1 million the previous year, the global active installed base of VR headsets remained stable at 23.6 million. However, only marginal growth is predicted by 2028, highlighting the need for industry-wide efforts to reignite consumer interest.
To revive the VR market, companies must prioritize the release of exciting games, invest in innovative content, and address pricing concerns. They should also focus on improving the overall VR experience by incorporating technological advancements and expanding into new markets.
In conclusion, the consumer VR market has faced challenges like reduced spending on VR content and a lack of appealing game releases. However, industry analysts maintain cautious optimism, expecting a gradual recovery from 2024 and potential revenue growth in the coming years. Adapting, innovating, and rekindling consumer interest are crucial for propelling the VR industry forward.