Virtual Disruption — It's Real The virtual reality (VR) market has made significant strides throughout 2016. New VR hardware debuted amid great consumer anticipation, while VR content launches kept pace. At the same time, industry groups and conferences brought developers, investors, and content producers together, helping to further ramp up buzz in this nascent space. A BI Intelligence presentation from the IGNITION conference, titled: Virtual Disruption — It's Real, contains four major predictions for the future of virtual reality.

1. P R O V I D I N G I N - D E P T H I N S I G H T ,
D A T A , A N D A N A L Y S I S O F
E V E R Y T H I N G D I G I T A L .
VIRTUAL
DISRUPTION —
IT’S REAL
JE SSIC A SM ITH,
R E SE A R C H A NA LY ST

5. TODAY’S VR
ISN’T THIS
Source: thearcademan.net

6. Source: George Nikitin/AP
OR THIS

7. OR THIS, EITHER
Source: STR/Reuters

8. BUT IT’S
ALSO NOT THIS
...YET
Source: Facebook

10. Developers ConsumersInvestors

11. $86
$238
$787
$703
$2,606*
23 41 60
137 152*
2012 2013 2014 2015 2016
Investment Number of deals
+271%
GLOBAL INVESTMENT IS BOOMING
M ILLIO NS ($)
*2016 Full-Year Projection
Source: CB Insights, July 2016

12. THE VR MARKET IS EXPECTED TO HIT
$1 BILLION IN 2016
VR R E VE NUE G E NE R ATIO N, BY C ATE G O R Y, M ILLIO NS ( $ )
Hardware, $700
Content, $300
VR Market
Source: Deloitte
$1
billion!

13. Developers ConsumersInvestors

14. Very well, 36%
Extremely well, 24%
DEVELOPERS ARE READY TO MAKE VR CONTENT
Q: HO W W ELL W O ULD YO U SAY YO U UND ER STAND THE D EVELO P M ENT
P R O C ESS F O R VR TEC HNO LO GIES?
60% of developers
are at least very
familiar with VR
development process
Source: Yeti

15. 3 IN 4 DEVELOPERS ARE CREATING CONTENT FOR
A VR OR AR PLATFORM
0% 10% 20% 30% 40% 50% 60%
Google Tango
Microsoft HoloLens
Other
PlayStation VR
Google Daydream
Google Cardboard
Samsung Gear VR
Oculus Rift
HTC Vive
n=543
Source: Game Developers Conference

16. DEVELOPERS EXPECT VR TO ENTER THE
MAINSTREAM SOON
Source: Yeti
Very optimistic, 43%
Extremely
optimistic, 31%

17. Developers ConsumersInvestors

18. THERE’S INTEREST IN A WIDE ARRAY OF VR
ACTIVITIES
25%
22%
19%
11%
5%
4.9%
1.6%
1.1%
‘Travel’ to a new location
Play VR games
Watch TV, movies, or sports in VR
Preview venues (hotels, restaurants, etc.) you’re considering
visiting
Attend a class in a virtual classroom
Have a work meeting in a virtual conference room
Hang out with other people in a VR environment
Shop in a virtual mall or store
n=1,339
Source: BI Intelligence Exclusive Data, Q4 2016

19. AND THE REASONS FOR NOT USING VR TECH ARE
QUICKLY DISSIPATING
n=1,339
Source: BI Intelligence Exclusive Data, Q4 2016
84%
I don’t see a use for it
I don't think I'll like it
I think it would make me sick
I haven't had the opportunity to
Other

20. CONSUMERS TO DRIVE VR HEADSET SHIPMENTS
TO 55 MILLION IN 2022
0
10
20
30
40
50
60
2015 2016 2017 2018 2019 2020 2021 2022
Millions
Source: BI Intelligence Estimates

21. Developers ConsumersInvestors

22. Developers ConsumersInvestors

23. THE GLOBAL AR/VR MARKET IS EXPECTED TO ECLIPSE
MAJOR CONSUMER TECH CATEGORIES IN 2025
BILLIO NS ( $ )
$14 $15
$45
$62
$99
$110 $111
Game console VR/AR delayed
uptake
VR/AR base case Desktop PC TV VR/AR
accelerated
uptake
Notebook PC
Source: Goldman Sachs

24. THE GLOBAL AR/VR MARKET IS EXPECTED TO ECLIPSE
MAJOR CONSUMER TECH CATEGORIES IN 2025
BILLIO NS ( $ )
$14 $15
$45
$62
$99
$110 $111
Game console VR/AR delayed
uptake
VR/AR base case Desktop PC TV VR/AR
accelerated
uptake
Notebook PC
Source: Goldman Sachs

25. Source: Mike Fisher/AP

26. Source: The Lab