Strategy Analytics: AR is making waves – but headsets will continue to struggle

Augmented reality (AR) is making waves in the consumer market through apps such as Snapchat and Pokemon GO – but hardware is still struggling to break through.

A new series of reports from analyst firm Strategy Analytics, one focused on AR device market and outlook and another from forecast by device type until 2023, notes that slot-in AR devices will account for the majority of shipments and users today, but binocular units, such as HoloLens, will increase in importance as the market evolves towards devices with higher quality experiences.

The enterprise market has seen success in recent years in terms of trials; take GE, for instance, who at the start of this year announced its aviation arm had successfully piloted Vuzix AR glasses. In July, ABI Research noted how wearing smart glasses – as opposed to using AR on handheld screens – is empowering to workers.

Yet according to the report, if the AR market is to grow at size, then it is consumer, rather than enterprise, which needs to drive volumes.

“2013 and the launch of Google Glass really kickstarted the dedicated AR device market,” explained David MacQueen, the author of the report. “Although the device was not a commercial success, the potential of AR became clear and the hype around it saw Google, Apple, Microsoft and other major players make serious investments in the AR field.”

While plenty of this technology has moved onto the smartphone, consumer issues around the price of hardware continue. “The major factor holding back the market for dedicated AR devices today is simply the cost of the hardware,” said MacQueen. “In a typical enterprise deployment, this is not a major issue as the hardware itself is a relatively small part of the cost.

“The consumer market is much more price sensitive, and this is amply demonstrated by the relative success of the low cost $200 Lenovo slot-in Mirage AR headset, which drove the market to new heights in 2017,” he added. “Despite the product instantly becoming the top selling AR headset of all time, it only moved the needle slightly, increasing total shipments from the tens of thousands of units to the hundreds of thousands.”

You can find out more about the reports here and here.

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