AR/VR devices and their application scenarios are getting closer and closer to the lives of ordinary consumers. AR is augmented reality and VR is virtual reality. For example, when we put on a VR headset, we can play VR games with friends at home .
If we add other auxiliary equipment, we can also enter the world of the Metaverse and do almost anything that can be done in the real world. In addition, VR/AR can also be used for live broadcast, film and television, advertising, social networking and other fields.
Enterprise and Capital Accelerate Layout
In recent years, the sales of AR/VR devices have been generally good. At the end of May this year, the International Data Corporation IDC released the “Global Augmented and Virtual Reality Spending Guide” (2022 V1).
Its data shows that the total global AR/VR investment scale was nearly 15 billion US dollars last year, and it is expected to increase to nearly 75 billion US dollars in 2026, with a five-year compound growth rate (CAGR) of 38.5%. Correspondingly, the domestic market in recent years The compound growth rate will reach 43.8%, the growth rate is higher than the global level, and ranks first in the world.
Data from Zhiyan Consulting also shows that the global AR/VR headset market shipped more than 11 million units last year, a year-on-year increase of 92.1%, and this year’s shipments are expected to reach more than 15 million units, a year-on-year increase of 43.65%.
With the successive entry of major Internet companies and technology giants, the domestic AR/VR market has become more active, and the industry has begun to accelerate its development. For example, in August last year, ByteDance announced that it would invest 9 billion yuan to acquire Pico, a VR hardware company. At the beginning of May this year, Pico The planned task of VR equipment shipments this year has been increased to 1.8 million units. At the end of last year, Huawei launched the VR Glass 6DoF game suit.
According to IDC’s forecast, the domestic AR/VR market spent more than 2 billion US dollars in IT last year, and will soar to more than 13 billion US dollars by 2026. From a commercial point of view, by 2026, healthcare, education, The three fields of AR/VR technology and professional services will become important markets for industrial applications of AR/VR technology, and the combined user share of the three will be close to 30%.
Compared with consumer-level applications, industrial-level applications are still in the initial stage of development, and there are still bottlenecks in the applicability of scenarios, the professionalism and versatility of programs, and the industry application standard system, which makes virtual reality technology still not large-scale. Of course, from another perspective, it also contains huge business opportunities.
In general, the domestic AR/VR market is showing a thriving and prosperous scene, and from the perspective of capital, it also has great potential for development. For example, the market size of the domestic VR head display market last year was realized compared to 5 years ago. Double growth.
In the next five years, this market will be one of the main areas of capital attention, of which VR technology will attract about 70% of the investment. According to data from the China Electronics and Information Industry Development Research Institute, in the first nine months of last year, virtual reality The cumulative amount of investment and financing in the industry has exceeded 20 billion yuan, and both the number and amount of investment and financing have exceeded the level of all previous years.
The pace of product iterative upgrading is faster, and domestic equipment ranks among the first-class standards
Hardware has always been the main carrier of AR/VR technology. In recent years, hardware upgrades and iterations have been growing rapidly. Since 2018, all-in-one VR has gradually become the mainstream style of VR headsets, because the all-in-one VR is equipped with an independent The processor has the advantages of light weight, small size, and easy portability, so the VR all-in-one machine has developed rapidly in recent years.
Last year, AR/VR head-mounted display products ushered in a wave of new products, and this year will still maintain this good momentum. It is predicted that the industrial scale of hardware in the next five years will be stable at a compound growth rate of 47.8%. Growth, the proportion of spending by businesses or individuals on hardware equipment will exceed 50% of the total spending share.
Domestic AR/VR devices also have strong competitiveness in the world. For example, in the global VR headset shipment rankings, the Oculus series, especially the Oculus Quest2 from Meta, are currently the most popular VR headsets by consumers. , sold more than 10 million units last year.
Domestic VR headset companies are ranked 2nd and 3rd, namely Dapeng’s DPVR series and ByteDance’s Pico series. The Pico series is also very popular in the domestic market, and its market share has long been ranked first. At the Waller Virtual Reality (Europe) 2022 event exhibition, Pico officially launched the consumer-grade VR product Pico Neo 3 Link.
Last year, the shipments of iQIYI Qiyu series increased by more than 200% year-on-year, making it the fastest growing brand. Its online platform sales were also very good last year, ranking second with 27.4% of shipments. Pimax, a domestic high-end VR headset brand, is very popular in foreign markets. On the Steam platform, more than 80% of players who use VR headsets costing more than $1,000 buy Pimax.
Young and middle-aged groups are undoubtedly the main force in using VR equipment. Baidu index shows that from May 13, 2021 to May 13, 2022, among the people who searched for “VR glasses”, the age range of 20 to 39 years old The segment population accounted for 66%.
Of course, it will take a long period of time for young people to gradually accept this new thing. At present, the market penetration rate of VR equipment is still very low. All VR companies have chosen the method of burning money and taking volume to seize the market. Expand the scale of the VR user base.
For example, the official price of Oculus Quest 2 is US$300, which is about 2,000 yuan in RMB. The price of Pico Neo 3 series is roughly the same, and the profit brought by each VR device sold is relatively low.
In terms of promotion and marketing, various VR companies have also displayed their magic powers and launched many activities to attract consumers. For example, when iQIYI promoted the adventure Dream, it launched a strategy of giving away more than 30 mainstream VR games for free. , building an offline experience store is also a relatively large expenditure.
Another point worth mentioning is that ByteDance has also increased its resource investment in Pico. At present, Douyin can be used on Pico. There is no doubt that video will also be an important component of enterprise VR ecological construction. In part, it’s as appealing to young people as gaming.
The ecological environment is the key to success or failure
When it comes to AR/VR devices, we have to mention the Metaverse. The Metaverse is a virtual reality world that exists on the Internet. Supporting the Metaverse, in addition to AR/VR devices, there are also three-dimensional technology (3D), Cutting-edge technologies such as 5G and artificial intelligence (AI) bring us an immersive experience close to the real world.
With the continuous popularity of the Metaverse concept, a large amount of capital is also investing in the VR field. Internet companies and technology giants at home and abroad are all deploying or increasing their investment in this field. Apple, Huawei, Xiaomi and other companies have corresponding layout plans. If Huawei launched VR Glass 6DoF at the end of last year, Apple will also launch AR/VR products this year.
With the continuous upgrading and iteration of technology and the continuous innovation of products, in terms of hardware configuration and performance parameters, there is not much difference between domestic first-line brand VR headsets and foreign products, and the gap between the two is mainly reflected in the game software ecological environment.
Specifically, the number of games that domestic VR headsets can support is much smaller, there is also a gap in game quality, and the speed of game updates is also relatively slow. This problem in turn affects the efforts of domestic VR headsets to increase market share.
For example, after Meta acquired Oculus, it also has the world’s first-class VR game resources unique to its Oculus store, such as Medal of Honor, Star Wars, Beat Saber, etc. In other words, if you want to play these games, you can only buy them Meta’s VR products, which is why Meta VR products are leading the way in sales, which is similar to the iPhone.
VR/AR devices are only the entrance to games or applications. Only after enterprises have built a strong and complete ecological environment including software, communities, and developer systems, can they truly have the strength to compete in VR/AR arena.
This is similar to the mobile phone’s ecological application system environment. When Meta acquired Oculus, it formed a virtuous circle between the ecological environment, the number of users and the sales of VR/AR devices.
In this regard, domestic manufacturers have adopted roundabout strategies, such as ByteDance’s Pico Neo3 VR, which is connected to a computer and added to Steam VR, a global game ecological platform, to make up for its relatively small number of games.
It can be said that games are the most important application scenarios of AR/VR technology. It determines the development speed and influence of AR/VR technology to a certain extent. Data from the Steam platform shows that VR users increased by 11% year-on-year last year. More than 1.8 million VR game players have been added, and game technology and hardware equipment have been constantly improving and maturing.
According to this trend, in the next few years, on the one hand, more high-quality AR/VR games will be released, and on the other hand, the use effect of AR/VR equipment will be better than before, such as the low latency brought by 5G technology. , the dizziness problem of AR/VR equipment will also be significantly alleviated.
There is no doubt that if more and better consumer game applications can continue to emerge in the future, it will inevitably accelerate the development of the AR/VR industry. In this regard, many domestic game manufacturers have already made arrangements in advance, and they have achieved small gains.
For example, NetEase and Survios established NetEase Shadow Core, announcing that it will launch three VR games at the same time this year, “Captain Dynamic: Planet Defense”, “Maze Room VR” and “Creed: Arena of Glory”. The “Eternal Warrior VR” jointly developed by the domestic VR game company Weimo Era and Glu Mobile of the United States has also been well received on the Steam platform.
“Yu Jian Column” believes that the AR/VR consumer market has great development potential and commercial application value. With the increasingly rich application scenarios and the continuous improvement of the content ecology, the industry will enter a period of accelerated development in the next few years. With the expansion of consumer groups, the improvement of enterprise production capacity and the popularization of software and hardware technologies, the price of VR hardware is also gradually dropping, which can be accepted by more users.
If one day in the future, the Metaverse can be highly integrated with the real world, then AR/VR equipment at that time will become a necessity in life just like mobile phones today.