The Burgeoning Commercial VR Opportunity

Double exposure of man using the virtual reality headset

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Consumer uptake of virtual reality might be taking longer than some pundits expected, but the technology is finding robust traction on the commercial side of things. In fact, IDC recently published a Worldwide AR/VR Spending Guide report that predicts commercial spending on hardware, software, and services related to virtual reality will surpass consumer spending on the technology this year. What makes this particularly interesting is that this commercial growth is taking off despite the dearth of commercial-focused hardware in the market.

Strong Uptake Across Numerous Verticals
May of the challenges faces VR in the consumer market, such as the high cost of hardware, the complexity of setup, and the lack of mainstream content, aren’t major issues when it comes to commercial deployments of the technology. And across many different verticals and use cases, the benefits are obvious, and the potential return on investment is clear. IDC’s research on the topic to date has explored VR in 12 different industries and across 26 different use cases. And remember: it is still early days.

Some of the most compelling industry use cases include:

Growth Despite Key Challenges
IDC has forecast robust growth in all the above areas, as well as a long list of others. And this growth is occurring even though a great deal of the early work here is happening on the consumer-grade hardware that’s available in the market today. Suffice to say, products designed for use by consumers aren’t rugged enough for long-term deployments in commercial settings. This lack of commercial-focused VR hardware is a clear market need the industry has failed to address so far.
Later this year I expect the launch of standalone VR products—based on reference designs from Intel and Qualcomm—to gain more traction in commercial than in consumer. While most consumers have limited need of a VR-only device, companies looking to deploy VR will find the simplicity quite appealing, especially after vendors start building robust, commercial-grade versions.

As the number of hardware options increase and more commercial-centric designs hit the market, the software and services associated with the technology will improve, too. We should also start to see the emergence of more VR standards, which will be key for long-term growth. And in the span of a few short years VR will be quite well entrenched in many of these vertical markets. This represents a large opportunity for the technology companies that service these markets, and an outsized threat to those industry verticals that fail to embrace the technology in a timely manner.