Every year, the global consulting powerhouse PwC shows the impact of changes in consumer habits by publishing its Outlook report. The most recent issue, called Global Entertainment & Media Outlook 2021–2025, of the report focuses on the continued impact of the pandemic and how it transforms sectors and business models.
According to the report, virtual reality is on track to outperform all other media by 2025.
“Virtual reality (VR) was the fastest-growing segment covered by the Outlook in 2020, with revenue of $1.8 billion, up 31.7% from 2019, albeit off a very low base,” the report states. “VR will also be the fastest-rising E&M segment over the forecast period, with revenues rising at a 30.3% CAGR to $6.9 billion in 2025.”
The rapid growth of VR as a media segment is attributed to the release of attractive VR games, namely Half-Life: Alyx, and the launch of competitively priced VR headsets, such as the $299 Oculus Quest 2.
While VR games will continue to be the biggest generator of revenue, VR video is growing at an impressive pace as well, projected to grow $615 million during 2020 to $1.4 billion by 2025.
When it comes to VR hardware, the standalone headset will continue attracting the most consumers, but home PC VR market will also increase. Only mobile VR devices, which were considered to be the best affordable entry points into the world of virtual reality just a few years ago, are expected to decline.
Even though the report doesn’t discuss it because it falls outside its scope, the growth of VR could be further accelerated by the ongoing shift to remote work and the resulting need of remote workers to collaborate over long distances effectively.