Metaverse Market

Metaverse Market - Size, Growth, Report & Analysis

[359 Pages Report] The global Metaverse Market size as per revenue was surpassed $83.9 billion in 2023. It is anticipated to grow at a CAGR of 48.0% in between 2023 to 2030. The revenue forecast for 2030 is set for the valuation of $1,303.4 billion. The base year for estimation is 2022 and the market size available for the years from 2023 to 2030.

The growth of the metaverse market is the growing demand of the global entertainment and gaming industry. It has witnessed the fastest growth owing to the increasing adoption of AR, VR, and MR technologies. The key reasons for adopting these technologies are that the devices, such as VR headsets, MR headsets, HUD, HMD, smart glasses, and smart helmets, can offer the first-person perspective, act as natural user interfaces, provide 6-degree freedom, etc., to create realistic-looking virtual scenarios to enhance the overall gaming experience of end users.

Prominent gaming and digital technology players are channeling substantial investments into developing tailored metaverses. A primary driver behind this surge in metaverse technology expenditure is the immense potential for marketing a wide array of products within these metaverses. The metaverse allows gamers to immerse themselves in virtual reality while engaging in gameplay fully. Numerous companies strive to construct digitally captivating platforms that offer customers deeply satisfying gaming experiences. Several key factors propelling the growth of market revenue encompass a steadily expanding user base in the gaming industry, the rising popularity of play-to-earn games, and the rapid advancements in AR, VR, and metaverse (XR) technologies.

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Metaverse Market Growth Dynamics

Drivers: Increasing adoption of metaverse in the healthcare sector

Using metaverse in the healthcare sector opens new opportunities for medical practitioners and holds a promising future, especially for modern healthcare organizations. It enables doctors and patients to connect virtually for sessions without geographical limitations and assists virtual wellness, fitness, mental health, and doctor-patient interaction. Various technologies in the metaverse, such as AR, VR, MR, digital twin, blockchain , AI, and ML, will transform the medical sector. For instance, using metaverse, doctors can perform virtual surgeries on the dummies created using digital twins. Further, the blockchain ensures safe transactions and anonymous data storage of patient records. With advancements in artificial intelligence (AI) and machine learning, XR applications will soon be able to adapt to individual users’ needs and preferences; this will provide personalized experiences for medical training, patient education, and therapy, which can lead to improved engagement, retention, and overall effectiveness. By tailoring these experiences to each user, healthcare providers can ensure that their patients receive the most relevant and engaging information, leading to better outcomes.

Restraint: Regulating the metaverse concerning cybersecurity, privacy, and usage standards

Security and privacy issues are the significant challenges faced by the VR, AR, and MR industries. These issues have emerged due to the inconsistencies in programming and negligence and oversight of both the developers and end users of apps and devices. Many consumer AR applications available on the Play Store and App Stores do not have the capabilities to secure user identity and privacy, thereby raising cybersecurity concerns. Further, there are no regulations or defined standards in the metaverse industry at a global level stating the dos and don’ts associated with the metaverse environment. In addition, there is a need to regulate and define taxation in digital real estate, which further hinders the adoption of a metaverse in the entertainment sector. Such factors would slow the market’s smooth growth soon.

Opportunities: Incorporation of metaverse and adjacent technologies in the aerospace and defense sector

Technologies like XR, AI, and analytics in the aerospace and defense sector are expected to be useful for training and simulating applications. These technologies, coupled with metaverse, are expected to be helpful for experiential training by using real-time data-driven applications. Thus, the metaverse is projected to enable the improved and efficient transfer of accurate skills and enhanced knowledge retention by trainees. Metaverse is used to train the ground crew for pre-flight checks in airlines. It also enables the ground crew to perform the required procedures before the aircraft takes off. In integration with XR, the metaverse can also help in weapon training, flight training, and simulations, thereby boosting the market growth.

Technologies like Metaverse (XR), Artificial Intelligence (AI) , and analytics will find substantial utility within the aerospace and defense sector, primarily in training and simulation applications. The convergence of these technologies with the metaverse can revolutionize experiential training, employing data-driven applications in real-time scenarios; this suggests that the metaverse can facilitate the enhancement and efficiency of skill transfer and knowledge retention among trainees in this particular industry. An instance of utilizing metaverse is observed in training ground crew members responsible for pre-flight inspections in the aviation sector. These technologies can empower ground crew personnel to execute essential protocols before aircraft take-off. For instance, in November 2022, SimX, a medical device manufacturing company, received a research and development contract from the US Air Force to create an improved virtual reality (VR) medical simulation training program. The goal was to adapt their current VR medical simulation system to produce a platform that guarantees increased flexibility and consistency for tactical combat casualty care training.

Challenges: Health and mental issues from excessive use

The devices used to experience metaverse, such as HMDs, are highly sophisticated but have also become the focus of health concerns. The most common risk is injuries caused to users due to their bumping into real objects while engrossed in the virtual world. Several users have also reported headaches, eye strain, dizziness, and nausea after using such devices. According to research by the University of Leeds, exposure to VR for 20 minutes will affect the ability of some children to discern the distance between objects. Moreover, the regular use of such devices will accelerate the propagation of myopia at a global level.

Another limitation is the low resolution of VR-enabled devices. Low resolution causes difficulty in viewing and can also aggravate symptoms of virtual sickness, such as irritation and nausea. Fixing the resolution can cause a more significant burden on the processing and graphical processing units, affecting the performance.

Apart from these, these devices also expose users to harmful electromagnetic frequency radiation, which may cause illness. Researchers from the National Toxicology Program (NTP), a federal inter-agency program under the National Health Institutes (US), experimented on mice to demonstrate that subjects exposed to electromagnetic radiation might be highly vulnerable to cancer. Therefore, excessive use of metaverse devices can cause health issues, limiting the growth of the metaverse market.

Ecosystem

Based on the component, the strategy and business consulting services under the professional services segment significantly contribute the highest market share to the metaverse market during the forecast period.

Consulting services deal with complex inquiries and have numerous clients that demand constant changes in their solutions and service offerings. These services focus more on offering superior customer service. The business consulting service focuses on user pain points, goals, and timelines while considering the technology and human resource bandwidths. Service providers offer consulting services to help clients implement new methodologies for recognizing additional revenue streams. Consulting services help in defining deployable use cases for achieving better business performance. Strategy and business consulting services in the metaverse are becoming increasingly crucial as virtual and augmented reality technologies evolve and shape new business opportunities. Here are some areas where strategy and consulting services can be valuable in the metaverse:

• Market Analysis and Entry Strategy:
  • Assessing market potential in the metaverse.
  • Identifying target customer segments and their preferences.
  • Determining the feasibility and timing of entry into metaverse markets.
• Platform and Technology Selection:
  • Evaluating different metaverse platforms and technologies.
  • Advising on hardware and software requirements.
  • Assessing compatibility with existing IT infrastructure.

Based on the vertical, the consumer segment will dominate the metaverse market more during the forecast period.

Interaction plays a vital role in the metaverse. Metaverse is highly empirical and interactive because students can connect and interact in real-time and change their choices to improve performance. Corporates have added gameplay to their Learning and Development (L&D) programs to enjoy higher employee engagement and performance. Continuous advancements in VR, AR, AI, and computer graphics make the metaverse more immersive, accessible, and appealing to consumers. User-friendly content creation tools like 3D modeling software and game engines like Unity and Unreal Engine enable individuals and small teams to develop and contribute to metaverse content and experiences. Brands and advertisers are exploring metaverse-based marketing campaigns and virtual events, leveraging these environments’ immersive and engaging nature to connect with consumers in new ways. Gaming and social media hold the largest share of the consumer vertical market in 2023. The high percentage is attributable to the increasing user base of decentralized play-to-earn games and the rise of a metaverse in social media. The video games industry has been the earliest and foremost user of extended reality technology. It employs various tools and frameworks to develop extended reality games. Several game developers create interactive 3D media experiences and comprehensive participation effects, allowing players to dive into a completely different reality. The video games industry has been the early and foremost user of metaverse technology. It employs various tools and frameworks to develop VR and AR games. A few game developers create interactive 3D media experiences and comprehensive participation effects, allowing players to dive into a completely different reality.

AR technology has transformed the gaming industry over the past few years by enhancing users’ immersion in the gaming experience. This technology uses the existing environments in gaming applications to develop playing fields within it. AR technology provides users an interactive experience of a real-world climate wherein real-world objects are augmented. It superimposes animated objects on a live view of the real world. AR games are mostly mobile-based or tablet-based. They are also available for portable gaming systems.

Asia Pacific to grow at the highest CAGR during the forecast period.

E-commerce has become a key area of focus for retailers in the Asia Pacific, with China being the largest e-commerce market worldwide. The high demand for metaverse devices and metaverse software from the commercial sector is expected to drive the market’s growth in Asia Pacific. Asia Pacific registers the highest demand for consumer products such as smartphones, tablets, laptops, and TV sets. The region is an attractive market for cell phones, tablets, laptops, and television manufacturers. Companies such as Samsung and LG are in South Korea. In contrast, Sony, Sharp, and Panasonic are significant suppliers of legacy metaverse hardware in Japan and facilitate metaverse experience through their latest smartphones and tablets.

Initiatives and funding by governments to support the research and development of the metaverse would boost regional growth. For instance, in 2022, in collaboration with a global technology company, the Centre for Civil Society and Governance of the University of Hong Kong announced a proposal request (RFP) for AR/VR Policy Research in the Asia Pacific region. This initiative encouraged the academic community to undertake solutions-focused research to facilitate the responsible development of AR and VR technologies. The industry intended to award six grants, each worth about USD 100,000. The digital currency market is growing in Asia Pacific. Japanese cryptocurrency exchanges are speeding up the listing of cryptocurrency traders. In February 2021, MAXST Co., Ltd. (South Korea) launched its spatial AR platform, MAXST VPS, a technology that detects a user’s location by constructing a 3D spatial map for indoor and outdoor AR content creation. It will connect all real-world aspects with the virtual world or metaverse. In August 2021, WIMI Hologram Cloud, an AR application technology provider in China, announced the establishment of the “Holographic Metaverse Division” to develop the underlying metaverse holographic technology and to explore next-generation internet services. South Korea’s strength in music shows, TV, and video games makes the country a fertile ground for developing the NFTs framework in the country. For instance, in November 2021, HYBE Corporation, a Korean entertainment company, partnered with Dunamu, a blockchain company, to establish a joint venture for launching the NFT marketplace.

Key Players

Microsoft (US), Sony (Japan), Meta (US), HTC (Taiwan), Google (US), Apple (US), Qualcomm (US), Samsung (South Korea), Activision Blizzard (US), NetEase (China), Electronic Arts (US), Take-Two (US), Tencent (China), Nexon (Japan), Epic Games (US), Unity (US), Valve (US), Accenture (Ireland), Adobe (US), HPE (US), Deloitte (UK), Tech Mahindra (India), Ansys (US), Autodesk (US), Intel (US), ByteDance (China), NVIDIA (US), Epson (Japan), Panasonic (Japan), EON Reality (US), Roblox (US), Lenovo (China), Razer (US), Nextech AR Solutions (Canada), ZQGame (China), Talecraft (US), VR Chat (US), Decentraland (US), Sandbox VR (US), and Quidient (US) are the key players in the metaverse market.

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Scope of the Report

This research report categorizes the Metaverse Market based on service types, verticals, and regions.

Based on Components, the Metaverse market segments are as follows:

• Hardware
  • AR devices
    • AR devices: by Type (qualitative)
    • AR Head-Mounted Displays (HMD)
    • AR smart glasses
    • Smart helmets
    • AR Head-Up Displays (HUD)
  • VR devices
    • VR devices: by Type (qualitative)
    • VR Head-Mounted Displays (HMD)
    • Gesture-tracking devices and haptics
  • MR devices
  • Displays
    • Displays: By Type (qualitative)
    • 3D displays
    • Holographic Displays
    • Virtual Mirrors
• Software
  • Extended Reality Software
  • Gaming Engines
  • 3D Mapping, Modeling, and Reconstruction
  • Metaverse Platforms
  • Financial Platforms
  • Other Software
• Professional Services
  • Application Development and System Integration
  • Strategy and Business Consulting Services

Based on vertical, the Metaverse market segments are as follows:

• Consumer
  • Gaming and Social Media
  • Live Entertainment and Events
• Commercial
  • Retail and eCommerce
  • Education and Corporate
  • Travel and Tourism
  • Real Estate
• Industrial Manufacturing
• Healthcare
• Other verticals

Based on regions, the Metaverse market segments are as follows:

• North America
  • US
  • Canada
• Europe
  • UK
  • Germany
  • France
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • Rest of Asia Pacific
• Middle East and Africa
  • United Arab Emirates (UAE)
  • Saudi Arabia
  • South Africa
  • Rest of the Middle East and Africa
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America

Recent Developments

• In February 2023, Google launched XR Immersive Stream, which is a cloud-based graphics rendering service that utilizes Google Cloud’s graphics processing units to deliver high-quality, intricate images and videos to any device. Developers can use this service to craft various immersive experiences without requiring robust hardware or specialized applications on the user’s end. Essentially, the critical benefit of XR Immersive Stream is its ability to eliminate the necessity for devices to possess potent hardware or specialized applications to submerge users in 3D or AR environments fully.
• In October 2022, Meta and Microsoft partnered to create a more immersive future for work and play. They plan to introduce Mesh for Microsoft Teams to Meta Quest devices; this technology is the culmination of years of research and innovation, including Azure Digital Twins, Dynamics 365 Remote Assist, and Teams video meetings. It allows people to meet virtually in the place where work happens, using any device, from smartphones to laptops and mixed-reality headsets. By using Mesh for Teams with Meta Quest Pro and Meta Quest 2 devices, people can collaborate as they are in the exact location.
• In November 2021, Samsung acquired an American optics company, DigiLens, to develop a new type of lens iteration called holographic waveguides featuring a wider FoV (Field of View) than other waveguides.

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