02 October 2017
| James Pearce
The number of virtual reality and augmented reality devices sold will hit almost 99 million in 2021, increasing pressure on wholesale providers to boost networks capable of dealing with more content.
Figures from analyst CCS Insight found 16 million VR and AR devices will be shipped in 2017, up 47% year-on-year, but this will skyrocket to almost 100 million devices in the next five years.
The VR and AR device market is valued at around $1.6 billion, the research firm claims, but estimates this will hit around $11.9 billion by 2021 as demand for both smartphone-powered devices and standalone units grows.
The smartphone-powered units, in which a handset provides the technological aspect of the headset, makes up for about 13 million of devices sold due to availability and low pricing. However, standalone devices, such as the Oculus Rift and PlayStation VR, accounts for about two thirds of the $1.6 billion revenue generated in the sector this year.
Shipments of VR and AR devices by category, 2016-2021
Source: CCS Insight VR and AR Forecast, October 2017
CCS Insight analyst George Jijiashvili notes: "The expected growth is encouraging progress, but it has not all been plain sailing. The three biggest makers of dedicated VR headsets all cut their prices this year in an effort to boost sales and grab a bigger slice of the market."
Content will play a key role in driving the market, Jijiashvili added, meaning the backbone networks supporting content delivery will need higher capacity.
"So far, many people have bought VR devices for gaming, but other material, including sports, film, TV and pornography, is now playing a bigger role in the market's growth.”
A number of wholesale firms have begun providing specific content delivery networks to support growth in demand for TV and content services, driven by the likes of Netflix.
Speaking recently at a Capacity Africa conference, Ryan Solovei, CEO of Econet’s new content delivery platform Kwesé Play, spoke of the important of a strong CDN in delivering its services. Kwese has partnered with Liquid Telecom, also owned by Econet Wireless, and uses its network for delivery of its content offering.
“It’s a tough business and there are many aspects to putting together a successful service,” he explains. “From a technology side, you need to have a reliable network that delivers this content. This is not the US or a European market where you have lots of choices of CDNs at your fingertips. So we’ve had to go out and build our own content delivery network to support this.
“We were able to do this through our partnership with Liquid, and that means we have a reliable CDN that all of our content is delivered on. We have a number of nodes across Africa – West Africa, East Africa, and in the south – those are three key points of presence that allow us to reliably deliver this content to our customers.”