The Extended Reality (XR) headset market is poised for a substantial boost in 2024, with a projected record increase of 3.9 million units, marking a remarkable double-digit year-over-year growth.
Industry experts predict that Apple’s highly-anticipated Vision Pro, scheduled to go on sale in the US on 2 February, will play a pivotal role in driving user interest and industry dynamics.
Despite its premium price tag of USD 3,500, the Vision Pro is expected to sell around half a million units in 2024. Counterpoint analysts suggest that the initial appeal will be to dedicated Apple enthusiasts, developers, early adopters, and enterprise users. The XR market is anticipated to witness a ripple effect, benefitting existing market players offering competitively priced alternatives as consumers seek options beyond Apple’s premium offering.
In 2023, major players such as Meta and Sony launched several XR products, setting the stage for continued momentum in 2024. The trend of transitioning from virtual reality (VR) to mixed reality (MR) is expected to persist, with both existing and upcoming players rushing to introduce MR products or enhance their existing headset models, according to a Counterpoint report.
Augmented Reality (AR) is projected to experience a significant 54 per cent year-over-year growth in 2024, breaking a streak of three years of consecutive declines. XREAL’s Air 2 and Air 2 Pro AR Glasses, particularly successful in China, are anticipated to be key drivers of this growth. However, AR is expected to remain a relatively small contributor to overall XR shipments, constituting about 2 per cent of the market.
Regionally, North America is poised to be the dominant contributor to XR shipments, with nearly 70 per cent of the best-selling Meta headsets shipped in the region. The exclusive availability of Apple’s Vision Pro in the US for most of its first year is expected to further strengthen North America’s position. In contrast, Europe is expected to lag behind due to slower adoption and limited content offerings.
China’s growth in the XR market is projected to be sluggish in 2024, attributed to factors such as limited adoption of streaming, strict gaming regulations, and niche markets in education and enterprise segments. The rest of Asia-Pacific, fueled by the success of Sony’s PlayStation VR2 in Japan, is expected to perform strongly.
Samsung’s re-entry into the XR segment with an MR headset in 2024 is anticipated to generate traction, though it is predicted to contribute less to global shipment growth compared to Apple. On the other hand, Pico, owned by ByteDance, may struggle to recover fully from setbacks in 2023, while DPVR, despite strength in the Chinese education sector, faces challenges in breaking out as a major global player.
