Hardware revenues from virtual reality headsets, peripherals and 360° cameras are set to increase tenfold over the next five years, according to Juniper Research.
The new VR markets study claims that hardware revenues will climb from an estimated US$5 billion this year to more than US$50 billion (€45 billion) by 2021, driven by the widespread adoption of VR by smartphone users, and high unit prices for PC and console headsets.
Juniper predicts that the VR market will be “triggered” by the launch of the PlayStation VR headset this October, and Microsoft’s upcoming 4K and VR-capable console, dubbed Project Scorpio, in 2017.
While console VR will only make up 27% of VR hardware shipments, it will account for more than 50% of VR hardware revenues, according to the research.
The cost of ‘holder’ headsets, designed to offer a VR experience by housing mobile phones, are expected to remain low. However, more advanced platforms like Google Daydream – which is expected to launch this week – are projected to produce “more moderate revenues in the short term”.
“On the plus side, low cost headsets will allow consumers to ‘dip’ into VR, but potentially abandon it if the experience is poor. This could be problematic for smartphone VR software developers, who will be relying on in-app purchases for revenue,” according to the research.
“Console and PC based VR units can more easily provide high quality experiences, justifying a premium price and upfront software revenue. However, the shape of the early market may already have had an impact on PC-based VR content.”
Google is expected to launch its much-rumoured new Pixel phones – which are tipped to be the first on the market to run Google’s Daydream VR platform – at an event in San Francisco later today. Reports also indicate Google could launch a new 4K version of its Chromecast media streaming device and its new Amazon Echo-rivalling Google Home speaker.