The research firm said that sales of smartphone VR devices – including Google’s Cardboard products and more advanced devices like Samsung’s Gear VR headset – have already exceeded its earlier expectations.
CCS now predicts that 14.5 million smartphone VR headsets, worth over US$500 million, will be sold in 2016, rising to 72 million by 2020.
The forecast says that dedicated VR headsets like the Oculus Rift and HTC Vive are also “performing well”, with approximately 2 million of this type of device tipped to be sold in 2016, rising to 21 million in 2020.
“The momentum of 360-degree content is palpable and that’s driving sales of VR headsets. All major content providers are piling into this area, and user-generated content is poised to explode as more affordable 360-degree cameras come to market,” said CCS Insight chief of research, Ben Wood.
“Although it’s early days for dedicated virtual reality, it’s a promising market. HTC and Oculus VR struggled to meet demand when they launched their products and we expect a further wave of sales when Sony launches the PlayStation VR headset.”
CCS Insight estimates that the total VR device market will be worth US$1.5 billion in 2016 and will climb to US$11 billion by 2020.
Dedicated VR headsets are expected to play a “critically important role”, accounting for 85% of total market value despite having only 23% volume.