Global spending on virtual reality (VR) is expected to reach $28bn by 2030 from $7bn in 2018, according to GlobalData, a leading data and analytics company.

The company’s latest report, ‘Virtual Reality- Thematic Research’, highlights that the VR market will grow at a compound annual growth rate of 13% over the forecast period, from 2018 to 2030, driven by developments such as custom chips, untethered headsets, robust business models, new content and, notably, enterprise applications.

Ed Thomas, Principal Analyst for GlobalData’s Technology Thematic Research Team, commented: “VR has been around, in one form or another, since the mid-1950s, and been touted at various times as the next big thing in consumer technology without ever fulfilling its potential. Now, instead of a mainly consumer market focus, enterprise adoption is accelerating, with notable activity in areas such as retail, tourism and healthcare. VR companies are also developing domain-specific tools for functions such as training, education, and data visualization.”

VR software accounted for two-thirds of total market revenue in 2018, with the remainder coming from hardware sales. Games account for the largest share of software revenue (68% in 2018), with enterprise software contributing a further 30% and non-gaming consumer software about 2%.

Thomas continues: “The first generation of the VR market was a niche concern, popular primarily with affluent early adopters but hampered, as with previous iterations of the technology, by technical drawbacks and unrealistic expectations. The new nascent VR 2.0 will be more dynamic and results-oriented than the previous generation, with the integration of artificial intelligence, cloud services, motion tracking, eye tracking and 3D audio enabling these second-generation VR devices to deliver truly immersive experiences.”