The global metaverse market is poised for significant expansion, with an estimated growth of USD 1,152.35 billion expected from 2022 to 2027, according to a report by Technavio. The market is projected to grow at a compound annual growth rate (CAGR) of 40.06% during this period, with growth momentum anticipated to accelerate.
The report segments the global metaverse market based on geography, with North America expected to account for 39% of the market’s growth. Factors contributing to the region’s growth include the presence of key vendors, growing investments in Augmented Reality (AR) technology, increased adoption of advanced applications, and research activities in countries such as the US and Canada.
In 2017, the metaverse market was valued at USD 92.48 billion. The report provides a historical analysis of the market from 2017 to 2021, as well as insights into post-pandemic recovery and growth opportunities at regional levels.
Market Forces and Customer Landscape
Technavio’s analysis identifies the market as fragmented, employing Porter’s five forces model to assess the dynamics of the market, including the bargaining power of buyers and suppliers, the threat of new entrants, rivalry, and substitutes. The report delves into the market’s adoption lifecycle, exploring adoption rates in different regions and key purchase criteria.
The market is segmented based on device (VR or AR devices and computing devices) and component (hardware, software, and services). The VR or AR devices segment, which includes headsets, smart glasses, and lenses for metaverse interaction, is expected to account for a significant portion of the market during the forecast period.
The report identifies the growing smartphone penetration and use of 5G technology as key drivers of market growth. These factors are expected to boost the adoption of online platforms for activities such as shopping, thereby encouraging businesses in sectors like e-commerce and finance to adopt metaverse technologies to enhance virtual experiences.
Trends and Challenges
The rising adoption of online gaming is highlighted as a leading trend influencing the market. The gaming sector has been quick to adopt metaverse technologies, providing immersive visual experiences through blockchain, IoT, and 3D visualization. Improved internet connectivity and changing consumer preferences are increasing the adoption of online gaming.
However, the report also outlines challenges such as privacy and security concerns that may hinder market growth. The metaverse’s collection and processing of extensive user data, potential security vulnerabilities, and privacy issues related to smart gear usage are identified as factors that could pose obstacles to the market’s expansion.
Overall, the research underscores the substantial growth potential of the metaverse market while also acknowledging the challenges that need to be addressed to ensure sustainable development.
