What did we learn in 2019? What can we expect in 2020

ARtillery Intelligence’s latest report examines 2019’s biggest lessons in spatial computing and the outlook for 2020. Preview the report below, subscribe to access it in full, or purchase a la carte.  ARtillery PRO subscribers can access the report directly here (login required).

 

Executive Summary

Spatial Computing: 2019 Lessons, 2020 Outlook

They say that patience is a virtue. This applies to the current state of the spatial computing industry. After passing through the boom and bust cycle of 2016 and 2017, the last two years were more about measured optimism in the face of industry shakeout.

At the precipice of 2020, that leaves the question of where we are now? Optimism is still present but AR and VR players continue to be tested as high-flying prospects like ODG, Meta and Daqri dissolve. These events are resetting expectations on revenue outcomes.

But more than the ‘how much?” is a question of “when?” Market timing is quickly becoming a prominent factor to determine success of spatial computing players. This is a common factor in tech cycles historically. Spatial
computing will be no different.

Speaking of history, spatial computing follows a pattern similar to the early 2000’s eCommerce bubble. Exuberance is followed by market correction, followed by slow progression that eventually meets and exceeds early projections… but not until years later.

The good news is that this slow uphill progression has already started, and we believe the worst is behind us. Though the broader tech and media worlds have shrugged off AR and VR as fads that died in 2017, Industry subsectors are signaling growth by quietly gaining traction and revenue.

This includes AR-based advertising. ARtillery Intelligence projects it to grow from $453 million last year to $8.8 billion by 2023. This outlook follows the momentum of advertiser adoption, as well as the continued investment of tech leaders like Facebook and Snap.

There’s also a robust support industry germinating, including “building blocks” which are endemic to this period of any tech sector. Represented by tools such as Unity, Adobe Aero, and 8th Wall, AR-as-a-Service (ARaas) will be a major AR revenue category.

AR’s health also hinges on the outcome of Apple’s rumored AR glasses. Apple has a track record of mainstreaming emerging tech, and the AR industry is hoping for that halo effect. But based on signals we track, this will come a few years past the rumored 2020 launch.

Meanwhile, adjacent sectors will accelerate AR adoption and development. The broader wearables segment is growing rapidly, and will benefit AR by acclimating consumers to wearing tech on their bodies. 5G, self-driving cars and other areas will likewise feed into AR.

There are also lots of positive signals for market growth in VR. Facebook/Oculus continues to invest in hardware subsidies and loss-leader pricing to jumpstart a network effect. The result of this investment is high quality and consumer-friendly price points for Oculus Go and Quest.

What do all of these signals collectively tell us? And where do they point for 2020 outcomes? We’ll unpack the full list of market factors and 2019 lessons in this report, pursuant to illuminating likely paths for spatial computing in 2020. A robust ecosystem is (slowly) building.


Price: $499

This report is available by subscribing to ARtillery PRO, You can also purchase it for $499. This includes a briefing with the report’s author to discuss takeaways and answer any questions you may have.

 


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Price: $499

This report is available by subscribing to ARtillery PRO, You can also purchase it for $499. This includes a briefing with the report’s author to discuss takeaways and answer any questions you may have.

 


Methodology

This report highlights ARtillery’s Intelligence viewpoints, gathered from its daily in-depth coverage of the XR sector. To support the narrative, data are cited throughout the report. These include ARtillery Intelligence original data, as well as that of third parties. Data sources are attributed in each case.

For market sizing and forecasting, ARtillery Intelligence follows disciplined best practices, developed and reinforced through its principles’ 15 years in tech sector research and intelligence. This includes the past 4 years covering AR & VR exclusively, as seen in research reports and daily reporting.

Furthermore, devising these figures involves the “bottom-up” market-sizing methodology, which involves granular ad revenue dynamics such as campaign pricing and spending. More about ARtillery Intelligence methodology can be seen here, and market-sizing credentials can be seen here.

More about ARtillery Intelligence methodology can be seen here, and market-sizing credentials can be seen here.


Price: $499

This report is available by subscribing to ARtillery PRO, You can also purchase it for $499. This includes a briefing with the report’s author to discuss takeaways and answer any questions you may have.

 


Disclosure & Ethics Statement

ARtillery Intelligence has no financial stake in the companies mentioned in this report, nor received payment for its production. With respect to market sizing, ARtillery Intelligence remains independent of players and practitioners in the sectors it covers, thus mitigating bias in industry revenue calculations and projections. Disclosure and ethics policy can be seen in full here.

Spatial Computing: 2019 Lessons, 2020 Outlook

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