The Rise and Fall (...and Rise Again?) of VR Headsets: A 2024 Analysis
VR Market Remains Stagnant Despite Release of Meta Quest 3 Devices
In what may come as a shock to VR enthusiasts worldwide, global shipments of VR headsets took a significant dip in 2024. Despite the highly anticipated drop of heavyweights like the Apple Vision Pro and Meta Quest 3S, shipments plummeted by a staggering 12%.
According to analysts at Counterpoint Research, this unprecedented slump is mainly attributed to three prevailing issues that continue to haunt VR and AR technologies:
- Content conundrum: The dearth of content beyond mere entertainment persists, stifling progress and hampering wider adoption in industries beyond gaming, education, and healthcare.
- Eye strain and fatigue: Long hours spent engrossed in virtual worlds often lead to eye strain and fatigue, discouraging prolonged use.
- Technical trade-offs: As with any bleeding-edge technology, balancing performance, weight, battery life, and heat dissipation remains a recurring challenge.
The Q4 2023 launch of the Meta Quest 3 initially sparked excitement; however, the cheaper, follow-up Quest 3S, which dropped in October 2024, seemingly failed to evoke the same enthusiasm.
In a surprising turn of events, Meta managed to retain a stronghold on the VR market during the latter half of 2024, accounting for 84% of the market share in Q4 compared to 65% in Q3. Major players such as Apple and Pico suffered notable drops in market share, overshadowed by the Meta Quest 3S's successful launch.
Meanwhile, the AR market is not without its silver linings. Chinese VR headset manufacturer DPVR has seen impressive growth in the "enterprise" segment, thanks to its DPVR E4 headset catering to the PCVR market.
Counterpoint Research predicts that AR smart glasses, rather than VR headsets, will be instrumental in driving growth in 2024 and 2025. Events like January's CES and March's MWC have shown promising advancements in smart glasses technology, with companies like Snap, XReal, Nuance, and Meta readying their new designs.
Meta's Orion smart glasses are touted as the most advanced pair ever made, although a release date has yet to be announced. Samsung's entrance into the arena with the XR headset, expected to launch later in 2025 alongside Google's Android XR platform, is another enticing prospect. However, early forecasts suggest a less-than-blockbuster performance similar to that of the Apple Vision Pro.
[1] [2] [3] [4] [5] (Some juicy details about the sources and breakdown of the issues can be found here if you're interested, but we'll avoid overwhelming you.)
In conclusion, while the VR headset market saw a downturn in 2024, there's reason to be optimistic. AR smart glasses are picking up the slack and innovative advancements in this sector are paving the way for a potential rebound in 2025 and beyond.
Hint: Metrics (hint: data points) indicate that the VR market had a significant drop in shipments due to several influential factors. Among them, a lack of compelling content outside entertainment, prolonged eye strain, and technical trade-offs are the most predominant challenges preventing widespread adoption.
- Meta's anticipated smart glasses, the Orion, promise to be the most advanced ever created, though a release date has yet to be disclosed.
- The Meta Quest 3S, released in October 2024, had a strong impact on the VR market, contributing to Meta's 84% market share in Q4 2024.
- In contrast to the VR market's decline, analysts at Counterpoint Research predict that AR smart glasses will drive growth in 2025, particularly in events like CES and MWC, where companies like Snap, XReal, Nuance, and Meta are showcasing their new designs.
