Top 10 Insights into China‘s AR/VR Market in 2024
Time:2023-12-27
Views:364
2024 will be a crucial year in the long development of the AR/VR industry. The Apple Vision Pro, which has been sharpened for ten years, will finally make its debut in the consumer market. What kind of answer will top developers give? Over the past year, some manufacturers have been facing development bottlenecks, while on the other hand, new players are still rushing in crazily. Who has taken away whose cheese? In 2024, with only about 700 days left until the first decade of capital boiling, global practitioners have high hopes for China‘s industrial chain to enter and reduce costs. Can the original vision of the next generation of computing platforms be realized as scheduled?
IDC has summarized and provided ten insights into the Chinese AR/VR market in 2024, including trends in shipment volume, hardware product characteristics, user demand scenarios, supply chain development, and vendor competition patterns. The specific content is as follows
Insight 1: In 2024, China‘s AR market shipments are expected to grow by 101.0%, with split AR shipments accounting for 87.6% of the overall AR market
For the whole year of 2023, the Chinese AR market is expected to ship 240000 units, a year-on-year increase of 133.9%. The estimated shipment of integrated AR is 35000 units, and the estimated shipment of split AR (currently most products need to be connected to smartphones) is 205000 units. In 2024, AR shipments are expected to continue to grow rapidly, with a growth rate expected to reach 101.0%. Split type AR will still be the mainstream in the AR category, but it is worth noting that with the release of Qualcomm AR specific chips and advances in optical waveguide technology, mainstream manufacturers will successively release or iterate integrated AR glasses. It is expected that 60000 units will be shipped throughout 2024, an increase of 68.5%.
Insight 2: AI helps AR/VR devices accelerate their penetration into smart living scenarios, and the cooperation between AR hardware manufacturers and large model manufacturers continues to deepen
In 2024, the development trend of AI+AR will help glasses products achieve better NLP interaction and display screen presentation. High speed text processing, accurate intelligent Q&A dialogues, precise semantic understanding, and efficient instruction recognition will all shine in applications such as real-time translation, navigation, video photography, and life assistants. AR hardware manufacturers will adopt a parallel self-developed+cooperative model, and hardware products that cooperate with large model manufacturers will also be launched one after another, guiding users to experience, accept, and rely on more efficient and convenient new productivity tools.
Insight Three: Strong entry of image processing chips, efficient processing of real-time information, helping seamless connection between virtual and real
The M2+R1 dual chip design adopted by Apple Vision Pro has attracted widespread attention to the importance of image processing chips. In terms of visual and spatial experience, image processing chips provide real-time processing of sensory inputs, reducing the delay of users perceiving the surrounding environment and facilitating seamless connection between virtual and real. The layout of domestic chip manufacturers in this field is also constantly deepening.
Insight 4: Entering the "1+3" era around the core of visual experience, upgrading olfactory, tactile, and auditory sensory experiences in all aspects, and entering a period of high-speed optimization of related component performance
In 2024, VR devices will greatly upgrade from LCD screens to Micro OLED screens, and AR glasses will also transition from the Birdbath solution to the optical waveguide solution in optical solutions, resulting in a significant improvement in visual experience. Beyond the visual aspect, the design of AR glasses directional speakers in terms of directional propagation, sound quality, and privacy will also become a key competitive point for manufacturers in the sound production unit. Technologies such as gas sensors, VR interactive gloves, and linear motors for handles will continue to be optimized, with a focus on visual experience and a comprehensive upgrade of olfactory, tactile, and auditory sensory experiences.
Insight 5: Scene differences lead to the continuous development of multimodal interaction, and multiple interaction methods will coexist in the long term
The demand for differentiated scenarios determines that AR/VR devices will coexist in multiple interaction modes in the future. In entertainment, audiovisual, fitness, and other scenarios, the controller will play an important role; And smart rings and rings can help users better cooperate with voice to control AR glasses; In productivity scenarios with mixed reality headsets, gesture interaction will be more efficient and concise. Multiple interaction methods will complement each other and develop together.
Insight 6: XR devices have improved connectivity with other terminals, lowering threshold
In the past, the connection between AR/VR devices and external terminals was mainly through PC and mobile phones, and there were still many requirements and restrictions on the CPU, GPU configuration, and mobile phone brand and model of the PC. With the continuous improvement of connection adapters and application adaptability, tablets, console game consoles (Switch, PS, Xbox, etc.), and smart cars will be better connected to AR/VR devices. AR/VR devices will be more smoothly integrated into the smart terminal ecosystem, playing a role in travel, productivity, and entertainment scenes.
Insight 7: Key supply chain costs continue to decline, and the proportion of domestic production in multiple links of the XR industry chain will continue to increase
In 2024, with the launch of Apple Vision Pro, the domestic supply chain is accelerating its entry, and the cost of display screens is starting to decline. The cost pressure on manufacturers is beginning to improve, making it easier to achieve hardware profitability in the post subsidy era. From the perspective of supply chain layout, the proportion of domestically produced products will continue to increase in multiple aspects such as whole machine assembly, image chips, display screens, speakers, batteries, etc.
Insight 8: The offline channel system is constantly enriching, and manufacturers are entering a multi-dimensional competition of comprehensive sales channels, marketing strategies, content layout, and supply chain costs
From the perspective of channel system layout, more and more manufacturers are starting to cooperate with general agents, increasing cost investment and layout efforts in offline retail stores. From a marketing perspective, digital enthusiasts are still the key target audience for current advertising placements by manufacturers. In terms of content layout, manufacturers adopt a parallel approach of introducing and self-developed content applications to compete. From the perspective of supply chain costs, traditional hardware manufacturers such as mobile phones have more advantages. At present, the competition among AR/VR terminal manufacturers has shifted from a single hardware product competition to multi-dimensional competition in sales channels, marketing strategies, content layout, and supply chain costs.
Insight 9: The manufacturer landscape is facing a reshuffle
In the first three quarters of 2023, Pico‘s shipping share in the Chinese VR market reached 58.5%, ranking first in the first three quarters; In the AR market, Xreal, Thunderbird, and Rokid account for over 70% of shipments, and their rankings have changed in each quarter. It is worth noting that this year has also been a challenging year for Chinese AR/VR manufacturers, with several leading manufacturers facing numerous challenges such as layoffs, structural adjustments, financial difficulties, and even exiting the market. In 2024, top overseas manufacturers are expected to enter the Chinese market, with Apple‘s new products entering the market strongly, and mobile phone manufacturer AR glasses with new products poised to emerge. The competitive landscape of manufacturers in the Chinese market is full of variables.
Insight 10: The unified progress of domestic virtual reality industry standards will continue to accelerate
In recent years, the Ministry of Industry and Information Technology and other units have repeatedly released action plans for the integration and development of virtual reality and industry applications, promoting the unification of industry standards from multiple aspects such as basic universality, content production, content classification, testing and evaluation. Compatibility difficulties, format differences, and high costs are still issues that the entire industry needs to address together. In 2024, the progress of standardizing the domestic virtual reality industry will continue to accelerate.
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