FRAMINGHAM, Mass. — (BUSINESS WIRE) — September 28, 2017 — International Data Corporation ( IDC) is forecasting the combined augmented reality (AR) and virtual reality (VR) headset market to reach 13.7 million units in 2017, growing to 81.2 million units by 2021 with a compound annual growth rate (CAGR) of 56.1%. According to new forecast data from the IDC Worldwide Quarterly Augmented and Virtual Reality Headset Tracker, VR headsets will account for more than 90% of the market until 2019 while AR will account for the rest. In the final two years of forecast (2020—2021) IDC expects AR headsets to experience exponential growth as they capture a quarter of the market by the end of the forecast.

"AR headset shipments today are a fraction of where we expect them to be in the next five years, both in terms of volume and functionality," said Jitesh Ubrani senior research analyst for IDC Mobile Device Trackers. "AR headsets are also on track to account for over $30 billion in revenue by 2021, almost twice that of VR, as most of the AR headsets will carry much higher average selling prices with earlier adopters being the commercial segment. Meanwhile, most consumers will experience AR on mobile devices, although it's only a matter of time before Apple's ARKit- and Google's ARCore-enabled apps make their way into consumer grade headsets."

While AR headsets are poised for long-term growth along with a profound impact on the way businesses and consumers compute, VR headsets will drive a near-term shift in computing. Recent price reductions across all the major platforms, plus new entrants appearing in the next month, should drive growth in the second half of 2017 and will help to offset a slow start to the year. Screenless viewers such as the Gear VR will continue to maintain a majority share throughout the forecast, although the category's share will continue to decline as lower-priced tethered head-mounted displays (HMDs) gain share over the course of the next two years. Meanwhile, IDC is predicting that standalone HMDs will gain share in the outer years of the forecast.

"Virtual reality has suffered from some unrealistic growth expectations in 2017, but overall the market is still growing at a reasonable rate and new products from Microsoft and its partners should help drive additional interest in the final quarter of this year," said Tom Mainelli, vice president, Devices and AR/VR at IDC, "As we head into 2018 we'll see additional new products appearing, including standalone headsets from major players, and we expect to see a growing number of companies embracing the technology to enable new business processes and training opportunities."

In addition to the table above, a graphic illustrating the worldwide share of AR and VR headset shipments over the 2017—2021 forecast period is available by viewing this press release on IDC.com.

About IDC Trackers
IDC Tracker products provide accurate and timely market size, vendor share, and forecasts for hundreds of technology markets from more than 100 countries around the globe. Using proprietary tools and research processes, IDC's Trackers are updated on a semiannual, quarterly, and monthly basis. Tracker results are delivered to clients in user-friendly excel deliverables and on-line query tools.

For more information about IDC's Worldwide Quarterly Mobile Phone Tracker, please contact Kathy Nagamine at 650-350-6423 or knagamine@idc.com.

About IDC
International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly-owned subsidiary of International Data Group ( IDG), the world's leading media, data and marketing services company that activates and engages the most influential technology buyers. To learn more about IDC, please visit www.idc.com. Follow IDC on Twitter at @IDC and LinkedIn.

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