Artificial Intelligence (AI) in Virtual Reality Market by Component (Software, Hardware, and Content), Device (VR Simulators, VR Glasses, Head-Mounted Displays, Treadmills and Haptic Gloves, and Others), Technology (Machine Learning, Computer Vision, Context-Aware Computing, Natural Language Processing, and Others), Application (Object Recognition, Tracking, Customization, and Others), End-user (Gaming & Entertainment, Aerospace, Defense, Automotive, Healthcare, Education, Retail, Manufacturing, and Others), and Region (Asia Pacific, North America, Latin America, Europe, and Middle East & Africa) - Global Industry Analysis, Growth, Share, Size, Trends, and Forecast 2023 – 2031
The global artificial intelligence (AI) in virtual reality market size was USD XX Billion in 2022 and is likely to reach USD XX Billion by 2031, expanding at a CAGR of XX% during 2023–2031. The market is driven by the rising advancements in AI and the increasing use of virtual reality in entertainment, gaming, and others.
Rising adoption of artificial intelligence in consumer technology has an immense impact on the growth of the market. Virtual reality is advancing customer experience-based simulations not only for gaming and entertainment but also has vast applications in the automotive, healthcare, and retail industries. The use of AI minimizes the need for human intervention and makes the functioning of virtual reality devices seamless. Organizations are implementing this technology into service in various domains including marketing, designing, virtual training, assistance, engineering and maintenance, and simulation events. This, in turn, is projected to fuel the growth of the market during the projection period.
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In April 2022, Nikon Corporation entered into a partnership with Microsoft Corporation for the designing and development of solutions related to 3D and virtual reality. This has been done in order to enrich the content creation space.
The integration of AI is proving to be a game-changer in the world of virtual reality and extended reality (XR). The benefits of this amalgamation are manifold, as it allows for better user interaction, leading to enhanced user experiences, and the possibility of augmenting human intelligence and senses. Additionally, it offers cost-effectiveness in creating an immersive virtual world, bringing down the expenses that would otherwise be incurred. All of these factors are expected to boost the adoption of AI in VR solutions, thereby, driving the market growth during the projection period.
The research report finds that the COVID-19 pandemic impeded artificial intelligence in virtual reality market. The lockdown imposed by various governments all around the world disrupted the supply chain and distribution activities. This impacted the manufacturing and production of components, equipment, and devices related to the virtual reality setup. Although, the market is growing steadily, with the normalization of the COVID-19 scenario and advancement in AI in recent years.
Artificial Intelligence (AI) in Virtual Reality Market Dynamics
Major Drivers
Rising trend of live virtual entertainment is expected to drive the market during the projection period. There is a growing inclination among people for at-home entertainment using modern technology to view live events and shows. The implementation of artificial intelligence helps individuals get a lag-free and hyper-realistic virtual experience of live music concerts, live events, and sports. The increasing craze among people for such experiences is anticipated to propel the market during the forecast period.
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In April 2022, the famous rock music band, Foo Fighters, performed their event using the virtual stage of Meta. The videos were live-streamed over the Meta Quest headsets, providing an immersive 180-degree view.
Existing Restraints
High risk of cybersecurity threats is projected to impede the market during the projection period. Virtual platforms often have a high degree of vulnerability towards cyber-attacks that are intended to disrupt the functioning and extract vital information. Hackers constantly develop new and innovative approaches to find loopholes within the functioning of virtual platforms and exploit those weaknesses for money and information from unsuspecting customers. This can potentially lead to a decline in the use of virtual reality platforms, despite the implementation of AI.
Emerging Opportunities
Increasing options for personalization in virtual reality devices and platforms are anticipated to provide immense growth opportunities for artificial intelligence in virtual reality market. The integration of AI and implementation of machine learning technology with virtual reality raises the bar even further, and provides a large variety of customization options for various purposes, including everything from gaming to holding business meetings. In business, the use of AI helps in creating customizable templates based on the customer’s unique requirement by effectively utilizing the available customer data, such as demographics, browsing habits, and purchase history. This helps in boosting revenue and customer engagement.
Scope of the Artificial Intelligence (AI) in Virtual Reality Market Report
The market report includes an assessment of the market trends, segments, and regional markets. Overview and dynamics have also been included in the report.
Attributes |
Details |
Report Title |
Artificial Intelligence (AI) in Virtual Reality Market - Global Industry Analysis, Growth, Share, Size, Trends, and Forecast |
Base Year |
2022 |
Historic Data |
2016–2021 |
Forecast Period |
2023–2031 |
Segmentation |
Component (Software, Hardware, and Content), Device (VR Simulators, VR Glasses, Head-Mounted Displays, Treadmills and haptic Gloves, and Others), Technology (Machine Learning, Computer Vision, Context-Aware Computing, Natural Language Processing, and Others), Application (Object Recognition, Tracking, Customization, and Others), and End-user (Gaming and Entertainment, Aerospace, Defense, Automotive, Healthcare, Education, Retail, Manufacturing, and Others) |
Regional Scope |
Asia Pacific, North America, Latin America, Europe, and Middle East & Africa |
Report Coverage |
Company Share, Market Analysis and Size, Competitive Landscape, Growth Factors, Market Trends, and Revenue Forecast |
Key Players Covered in the Report |
Google; HaptX Inc.; HTC Corporation; Microsoft; NVIDIA Corporation; Meta; Qualcomm Technologies, Inc.; SAMSUNG; Sony Interactive Entertainment LLC; and Unity Technologies. |
Artificial Intelligence (AI) in Virtual Reality Market Segment Insights
Component Segment Analysis
Based on component, artificial intelligence in virtual reality market is divided into software, hardware, and content. The hardware segment is projected to hold the major share of the market during the projection period, due to the large investments being made by several companies for the development of advanced hardware components as it plays the key role in running hyper-realistic software. Better hardware helps in the creation of a high-quality VR setup, comprising a stereo sound system, a stereoscopic head-mounted display that delivers distinct imagery for each eye), and sensors for tracking head motion, that are made using magnetometers, gyroscopes, structured light systems, or accelerometers.
The software segment is expected to experience strong growth during the forecast period. This growth is driven by the increasing requirements for hi-tech virtual reality technology. VR software is in great demand in multiple applications, including gaming, entertainment, live events, business meetings, and seminars. Seamless functioning of software is one of the primary requirements and the incorporation of AI makes it possible for the software not only to run effortlessly but also provide better customization options, security, and ease of usage.
Device Segment Analysis
On the basis of device, the global market is segregated into VR simulators, VR glasses, head-mounted displays, treadmills & haptic gloves, and others. The head-mounted displays segment is projected to register a high CAGR during the forecast period. These displays provide an immensely immersive experience and are also available in cost-effective variants, such as cardboard-based virtual reality headsets by Google. The head-mounted displays (HMDs) are being increasingly used in marketing, aviation, training, and entertainment industries as they aid in speeding up the workflow and prove to be highly cost-effective in comparison to the real-world-based experience. For instance,
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In April 2021, the European Union Aviation Safety Agency certified Vajro and VRM Switzerland to hold virtual sessions of pilot training. The simulator is equipped with Varjo’s latest virtual reality headset Varjo XR-3, which has a human-eye resolution and is run using special technology used in Swiss flight training.
Technology Segment Analysis
On the basis of technology, artificial intelligence in virtual reality market is segmented into machine learning, computer vision, context-aware computing, natural language processing, and others. The machine learning segment is projected to hold a substantial share of the market, owing to its extensive implementation in virtual reality solutions to enhance the interactions and overall user experience.
ML is used for gesture recognition and enables the VR systems to accurately interpret and respond to the user’s movements, thereby creating a highly immersive experience. The rising adaptation of virtual reality is likely to propel the growth of this segment, owing to the enhancing effect it has on VR technology.
Application Segment Analysis
Based on the application, artificial intelligence in virtual reality market is segregated into object recognition, tracking, customization, and others. The object recognition segment is projected to register a considerable CAGR during the forecast period as it leverages AI to significantly enhance the immersive experience of virtual reality. It helps in identifying and understanding real-world objects and uses AI to seamlessly integrate them into the virtual environment. It helps the users to interact with physical objects and surroundings while being in the virtual world. With the increase of realism in virtual reality technology, this segment is projected to experience substantial growth in the coming years.
End-user Segment Analysis
Based on the end-user, the market is divided into gaming and entertainment, aerospace, defense, automotive, healthcare, education, retail, manufacturing, and others. The gaming & entertainment segment is expected to generate a major revenue share of the market, as several companies are making rigorous investments in the development of hardware, software, and content for gaming purposes.
The gaming industry is booming and there has been a sharp inclination of consumers towards mobile and computer-based games. The use of VR setups powered by AI is anticipated to propel this segment even further, as has been evident in recent years.
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As per a survey report published in August 2023, the gaming sector of the media market is projected to have an increment of close to 35% between the years 2023 and 2027. This growth is estimated to be equivalent to an amount of USD 136.8 billion.
The healthcare segment is projected to witness a massive adoption of VR technology in the near future, owing to the thriving implementation of virtual reality and artificial intelligence in healthcare. VR facilitates a controlled visual environment that is proving to be highly effective.
The use of AI makes it easier to use VR for training medical professionals as well as in diagnosing and treating patients. Furthermore, virtual reality technology is being increasingly used to assist autistic patients, in better understanding Alzheimer’s disease, and detecting visual impairment. The growing application of VR and AI in healthcare is likely to provide a substantial boost to the segment.
Regional Outlook
In terms of region, the global artificial intelligence (AI) in virtual reality market is classified as Asia Pacific, North America, Latin America, Europe, and Middle East & Africa. North America is expected to dominate the market during the projection period, due to the highly advanced technological infrastructure in this region. The region has a strong presence of market players who are global leaders in the field of AI and virtual reality.
A large number of tech startups that provide services related to VR and AI are entering the US market, providing solutions specific to various industries. Furthermore, the US government is also heavily investing in AI-based virtual reality technology to train its soldiers and officials using virtual, mixed, and augmented reality training sessions.
The market in Asia Pacific is projected to have substantial growth during the projection period, owing to the presence of several emerging economies and increasing disposable income. The region is witnessing a large demand for immersive technologies with the rapid development of 5G network infrastructure. Major countries in the region such as India and China have shown great interest in this field and are working towards the development of artificial intelligence in virtual reality technology.
2. Assumptions and Acronyms Used
3. Research Methodology
4. Artificial Intelligence in Virtual Reality Market Overview
4.1. Introduction
4.1.1. Market Taxonomy
4.1.2. Market Definition
4.2. Macro-Economic Factors
4.2.1. Industry Outlook
4.3. Artificial Intelligence in Virtual Reality Market Dynamics
4.3.1. Market Drivers
4.3.2. Market Restraints
4.3.3. Opportunity
4.3.4. Market Trends
4.4. Artificial Intelligence in Virtual Reality Market - Supply Chain
4.5. Global Artificial Intelligence in Virtual Reality Market Forecast
4.5.1. Artificial Intelligence in Virtual Reality Market Size (US$ Mn) and Y-o-Y Growth
4.5.2. Artificial Intelligence in Virtual Reality Market Size (000’ Units) and Y-o-Y Growth
4.5.3. Artificial Intelligence in Virtual Reality Market Absolute $ Opportunity
5. Global Artificial Intelligence in Virtual Reality Market Analysis and Forecast by Applications
5.1. Market Trends
5.2. Introduction
5.2.1. Basis Point Share (BPS) Analysis by Applications
5.2.2. Y-o-Y Growth Projections by Applications
5.3. Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by Applications
5.3.1. Object Recognition
5.3.2. Tracking
5.3.3. Customization
5.3.4. Others
5.4. Absolute $ Opportunity Assessment by Applications
5.5. Market Attractiveness/Growth Potential Analysis by Applications
6. Global Artificial Intelligence in Virtual Reality Market Analysis and Forecast by End Users
6.1. Market Trends
6.2. Introduction
6.2.1. Basis Point Share (BPS) Analysis by End Users
6.2.2. Y-o-Y Growth Projections by End Users
6.3. Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by End Users
6.3.1. Gaming and Entertainment
6.3.2. Aerospace & Defense
6.3.3. Automotive
6.3.4. Healthcare
6.3.5. Education
6.3.6. Retail
6.3.7. Manufacturing
6.3.8. Others
6.4. Absolute $ Opportunity Assessment by End Users
6.5. Market Attractiveness/Growth Potential Analysis by End Users
7. Global Artificial Intelligence in Virtual Reality Market Analysis and Forecast by Region
7.1. Market Trends
7.2. Introduction
7.2.1. Basis Point Share (BPS) Analysis by Region
7.2.2. Y-o-Y Growth Projections by Region
7.3. Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by Region
7.3.1. North America
7.3.2. Latin America
7.3.3. Europe
7.3.4. Asia Pacific
7.3.5. Middle East and Africa (MEA)
7.4. Absolute $ Opportunity Assessment by Region
7.5. Market Attractiveness/Growth Potential Analysis by Region
7.6. Global Artificial Intelligence in Virtual Reality Demand Share Forecast, 2019-2026
8. North America Artificial Intelligence in Virtual Reality Market Analysis and Forecast
8.1. Introduction
8.1.1. Basis Point Share (BPS) Analysis by Country
8.1.2. Y-o-Y Growth Projections by Country
8.2. North America Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by Country
8.2.1. U.S.
8.2.2. Canada
8.3. Absolute $ Opportunity Assessment by Country
8.4. North America Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by Applications
8.4.1. Object Recognition
8.4.2. Tracking
8.4.3. Customization
8.4.4. Others
8.5. Basis Point Share (BPS) Analysis by Applications
8.6. Y-o-Y Growth Projections by Applications
8.7. North America Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by End Users
8.7.1. Gaming and Entertainment
8.7.2. Aerospace & Defense
8.7.3. Automotive
8.7.4. Healthcare
8.7.5. Education
8.7.6. Retail
8.7.7. Manufacturing
8.7.8. Others
8.8. Basis Point Share (BPS) Analysis by End Users
8.9. Y-o-Y Growth Projections by End Users
8.10. Market Attractiveness/Growth Potential Analysis
8.10.1. By Country
8.10.2. By Product Type
8.10.3. By Application
8.11. North America Artificial Intelligence in Virtual Reality Demand Share Forecast, 2019-2026
9. Latin America Artificial Intelligence in Virtual Reality Market Analysis and Forecast
9.1. Introduction
9.1.1. Basis Point Share (BPS) Analysis by Country
9.1.2. Y-o-Y Growth Projections by Country
9.1.3. Latin America Average Pricing Analysis
9.2. Latin America Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by Country
9.2.1. Brazil
9.2.2. Mexico
9.2.3. Rest of Latin America
9.3. Absolute $ Opportunity Assessment by Country
9.4. Latin America Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by Applications
9.4.1. Object Recognition
9.4.2. Tracking
9.4.3. Customization
9.4.4. Others
9.5. Basis Point Share (BPS) Analysis by Applications
9.6. Y-o-Y Growth Projections by Applications
9.7. Latin America Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by End Users
9.7.1. Gaming and Entertainment
9.7.2. Aerospace & Defense
9.7.3. Automotive
9.7.4. Healthcare
9.7.5. Education
9.7.6. Retail
9.7.7. Manufacturing
9.7.8. Others
9.8. Basis Point Share (BPS) Analysis by End Users
9.9. Y-o-Y Growth Projections by End Users
9.10. Market Attractiveness/Growth Potential Analysis
9.10.1. By Country
9.10.2. By Product Type
9.10.3. By Application
9.11. Latin America Artificial Intelligence in Virtual Reality Demand Share Forecast, 2019-2026
10. Europe Artificial Intelligence in Virtual Reality Market Analysis and Forecast
10.1. Introduction
10.1.1. Basis Point Share (BPS) Analysis by Country
10.1.2. Y-o-Y Growth Projections by Country
10.1.3. Europe Average Pricing Analysis
10.2. Europe Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by Country
10.2.1. Germany
10.2.2. France
10.2.3. Italy
10.2.4. U.K.
10.2.5. Spain
10.2.6. Russia
10.2.7. Rest of Europe
10.3. Absolute $ Opportunity Assessment by Country
10.4. Europe Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by Applications
10.4.1. Object Recognition
10.4.2. Tracking
10.4.3. Customization
10.4.4. Others
10.5. Basis Point Share (BPS) Analysis by Applications
10.6. Y-o-Y Growth Projections by Applications
10.7. Europe Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by End Users
10.7.1. Gaming and Entertainment
10.7.2. Aerospace & Defense
10.7.3. Automotive
10.7.4. Healthcare
10.7.5. Education
10.7.6. Retail
10.7.7. Manufacturing
10.7.8. Others
10.8. Basis Point Share (BPS) Analysis by End Users
10.9. Y-o-Y Growth Projections by End Users
10.10. Market Attractiveness/Growth Potential Analysis
10.10.1. By Country
10.10.2. By Product Type
10.10.3. By Application
10.11. Europe Artificial Intelligence in Virtual Reality Demand Share Forecast, 2019-2026
11. Asia Pacific Artificial Intelligence in Virtual Reality Market Analysis and Forecast
11.1. Introduction
11.1.1. Basis Point Share (BPS) Analysis by Country
11.1.2. Y-o-Y Growth Projections by Country
11.1.3. Asia Pacific Average Pricing Analysis
11.2. Asia Pacific Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by Country
11.2.1. China
11.2.2. Japan
11.2.3. South Korea
11.2.4. India
11.2.5. Australia
11.2.6. Rest of Asia Pacific (APAC)
11.3. Absolute $ Opportunity Assessment by Country
11.4. Asia Pacific Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by Applications
11.4.1. Object Recognition
11.4.2. Tracking
11.4.3. Customization
11.4.4. Others
11.5. Basis Point Share (BPS) Analysis by Applications
11.6. Y-o-Y Growth Projections by Applications
11.7. Asia Pacific Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by End Users
11.7.1. Gaming and Entertainment
11.7.2. Aerospace & Defense
11.7.3. Automotive
11.7.4. Healthcare
11.7.5. Education
11.7.6. Retail
11.7.7. Manufacturing
11.7.8. Others
11.8. Basis Point Share (BPS) Analysis by End Users
11.9. Y-o-Y Growth Projections by End Users
11.10. Market Attractiveness/Growth Potential Analysis
11.10.1. By Country
11.10.2. By Product Type
11.10.3. By Application
11.11. Asia Pacific Artificial Intelligence in Virtual Reality Demand Share Forecast, 2019-2026
12. Middle East & Africa Artificial Intelligence in Virtual Reality Market Analysis and Forecast
12.1. Introduction
12.1.1. Basis Point Share (BPS) Analysis by Country
12.1.2. Y-o-Y Growth Projections by Country
12.1.3. Middle East & Africa Average Pricing Analysis
12.2. Middle East & Africa Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by Country
12.2.1. Saudi Arabia
12.2.2. South Africa
12.2.3. UAE
12.2.4. Rest of Middle East & Africa (MEA)
12.3. Absolute $ Opportunity Assessment by Country
12.4. Middle East & Africa Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by Applications
12.4.1. Object Recognition
12.4.2. Tracking
12.4.3. Customization
12.4.4. Others
12.5. Basis Point Share (BPS) Analysis by Applications
12.6. Y-o-Y Growth Projections by Applications
12.7. Middle East & Africa Artificial Intelligence in Virtual Reality Market Size and Volume Forecast by End Users
12.7.1. Gaming and Entertainment
12.7.2. Aerospace & Defense
12.7.3. Automotive
12.7.4. Healthcare
12.7.5. Education
12.7.6. Retail
12.7.7. Manufacturing
12.7.8. Others
12.8. Basis Point Share (BPS) Analysis by End Users
12.9. Y-o-Y Growth Projections by End Users
12.10. Market Attractiveness/Growth Potential Analysis
12.10.1. By Country
12.10.2. By Product Type
12.10.3. By Application
12.11. Middle East & Africa Artificial Intelligence in Virtual Reality Demand Share Forecast, 2019-2026
13. Competition Landscape
13.1. Global Artificial Intelligence in Virtual Reality Market: Market Share Analysis
13.2. Artificial Intelligence in Virtual Reality Distributors and Customers
13.3. Artificial Intelligence in Virtual Reality Market: Competitive Dashboard
13.4. Company Profiles (Details: Overview, Financials, Developments, Strategy)
13.4.1. Google
13.4.2. HaptX Inc.
13.4.3. HTC Corporation
13.4.4. Microsoft
13.4.5. NVIDIA Corporation
13.4.6. Meta
13.4.7. Qualcomm Technologies, Inc.
13.4.8. SAMSUNG
13.4.9. Sony Interactive Entertainment LLC
13.4.10. Unity Technologies