Global Location-based Virtual Reality (VR) Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Global Location-based Virtual Reality (VR) Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Global Location-Based virtual reality market was valued at USD 355.75 million in 2020, and it is expected to reach USD 1,575.63 million by 2026, registering a CAGR of 32.6% over the forecasted period. The COVID-19 crisis impacted most VR tech companies. Several VR gaming centers were closed due to stay-at-home orders during the initial months of the pandemic. For instance, Sandbox was operating 10 VR centers in North America and Asia, which allowed groups of customers to step into virtual worlds. Apart from Sandbox, several operators of VR centers and arcades, including The Void, Zero Latency, Dreamscape, and Spaces, were forced to shut down their retail locations amid the pandemic. They are now facing major financial and logistical challenges.

Key Highlights

• Due to the high cost of VR hardware, the market is able to bridge the gap generated between the gaming cafes in the past, with increased adoption of gaming consoles at home. The market of LBVR is enabling companies to build their businesses, as the consumers are eager to have different experiences with physical surroundings, using virtual reality.
• The retail arcades are the highest growing consumers, as the companies are making extensive investments toward arcade franchises. Seekers VR, based in the eastern city of Wenzhou, owns a franchised chain of 200 arcades in more than 70 cities across China. With the significant growth in the market across the world, companies are strongly focusing on creating influential high-definition 360-degree content and reducing the price per minute for the customers, as many people are required to manage single events with fewer audience at a time.
• The market for LBVR is still in a nascent stage. Making the VR experience more real serves as a critical driver for market adoption and penetration. Increasing implementation of VR technology, increasing investment in VR technology, and the growing popularity of 360-degree content are some other major factors influencing the growth of LBVR market. High-quality content plays a crucial role in this industry, and the market is expected to grow as more compelling, high-quality content that appeals to a wide demographic makes its way into the market.
• As per Arena Space, by the beginning of 2020, more than 13,000 VR parks had already been opened globally. Overall, the trend rose to 15,000 at the end of 2020. This indicates ways for high ROI for ARena Space and several other market players, such as VR Zone from Bandai Namco, Two Bit Circus, VR World NYC, and Mazaria.
• The Rates for VR app development vary according to the country the developers choose to develop the app in. In the United States or Canada, the development costs could be anywhere between USD 40-USD 240 per hour, whereas, in Western Europe, the costs remain similar, ranging from USD 40-USD 180 per hour. In India, the development costs can drop to USD 20-USD 70 per hour.

Key Market TrendsGrowing Popularity of 360-Degree Content

• The Market for virtual reality is expanding at a rapid pace, and the location-based VR market is quickly following suit. With the development of new technologies like 3D, 4D, 5D and advanced VR content, 360-degree videos have been introduced in VR and have become one of the notable trends in the global gaming content market. These camera systems are known to record the entire 360-degree view of a scene simultaneously.
• The entertainment sector has witnessed prominent advances with the help of advanced technologies. Various digital arenas and mainstream platforms of gaming are poised to grow with the rising demand for immersive environments. With the help of advanced camera systems, the popularity and acceptance of location-based VR is expected to grow and witness the massive potential for the VR market, over the forecast period.
• Furthermore, Consumer brands such as Emirates and Etihad provide 360 VR experiences. Jumeirah VR app allows guests to enjoy an AR/VR tour of its facilities using Google Cardboard goggles and smartphones.
• Although it is a relatively niche market innovation, 360-degree videos have gained commercial and public popularity in the recent past. Considering their novelty, there is a relative dearth of studies on the effectiveness, improved immersion, presence, and video evaluation from using 360-degree videos. Additionally, consumers that tend to view the videos on virtual reality headsets usually demonstrate increased attention to the curated content. With the growing demand for 360-degree content, the market studied is anticipated to grow at an exponential rate over the forecast period.
• Also, in July 2021, XRSpace unveiled a new virtual reality platform to facilitate social engagement and the world's first 5G VR mobile headset. It's made to be used with hand tracking as the primary control method, and it comes with 5G, 4G, or Wi-Fi connectivity, as well as a sensor tracker and a strong optical system on the front. Developments such as these are anticipated to fuel the market's growth.

Asia-Pacific Region expected to Witness Significant Growth

• Asia-Pacific is expected to hold the major share, owing to the presence of large and several emerging economies, along with the rising acceptance of virtual reality devices in the region. This is, in turn, expected to encourage industry players to invest in the region.
• China is expected to account for a prominent share in the region, owing to the rising adoption of VR technology in the country. Many startups pertaining to virtual reality are on the rise, in the country. Further, The expected wide-scale adoption of ultra-fast 5G networks in China is anticipated to boost VR development further and foster growth in areas such as education and training.
• Furthermore, In 2020, with an installation in Seoul's Incheon International Airport, AmazeVR, a virtual reality entertainment distribution company based in Los Angeles, expanded into location-based virtual reality experiences. In addition, the company received a USD 2.5 million commitment, bringing its total capital to roughly USD 9 million.
• Daimler India Commercial Vehicles (DICV) established its first Virtual Reality Centre (VRC) at its Chennai facility in June 2021. Operators will be able to realistically execute serviceability and accessibility checks using a digital model accessed via 3D goggles and navigational joysticks at the virtual reality center.

Competitive Landscape

The Global Location-based VR Market is moderately competitive with a considerable number of regional and global players. With increasing innovations in technology, the major players in the market are focusing on expanding their customer base across foreign countries by leveraging on strategic collaborative initiatives to increase their market share and their profitability.

• June 2021 - In partnership with Ubisoft, zero-latency launched Far Cry VR, a free-roaming virtual reality experience, in 33 locations across the globe. The launch was a result of a longstanding partnership with Ubisoft formed earlier in 2020.
• February 2021 - Vertigo Games, the multi-platform VR publisher, acquired SpringboardVR, a prominent VR venue management software provider. SpringboardVR's brand and software platform will continue to exist under the current name, but with the support and resources of the Vertigo Games team.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

Companies Mentioned

EXIT VR
Springboard VR (Vertigo Games)
SpaceVR Inc.
Survios Inc.
Hologate GmbH
Zero Latency PTY Ltd.
Oculus VR LLC (Facebook Inc.)
HTC Vine (HTC Corporation)
Tyffon Inc.
Neurogaming Ltd

Please note: This publisher does offer titles that are created upon receipt of order. If you are purchasing a PDF Email Delivery option above, the report will take approximately 2 business days to prepare and deliver.