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Virtual Reality (VR) is the use of computer technology to create a simulated environment that can be similar to or completely different from the real world. Unlike traditional user interfaces like viewing a screen in front of them, users are immersed and able to interact with 3D worlds. Applications of virtual reality can include entertainment (3D movies and video games) and educational purposes (i.e. medical or military training).
Virtual Reality and Augmented Reality (VR/AR) will be the most disruptive technology for the next decade. Worldwide spending on VR/AR is forecast to accelerate out of the COVID-19 pandemic, growing from $12 billion in 2020 to $75 billion in 2024 to $1.5 trillion in 2030. The largest initial VR/AR applications will be in training & education, remote collaborations including field service, and marketing & sales.
The focus of virtual reality is on simulating the vision. The user needs to put VR headset screen in front of his/her eyes. Therefore, eliminating any interaction with the real world. Virtual reality training is conducted using head mounted displays (HMD) with an inbuilt tracking system and data gloves to enable interaction within the virtual environment.
Modern virtual reality headset displays are based on technology developed for smartphones including: gyroscopes and motion sensors for tracking head, body, and hand positions; small HD screens for stereoscopic displays; and small, lightweight and fast computer processors.
Special input devices are required for interaction with the virtual world. These include the 3D mouse, the wired glove, motion controllers, and optical tracking sensors. Controllers typically use optical tracking systems (primarily infrared cameras) for location and navigation, so that the user can move freely without wiring. Some input devices provide the user with force feedback to the hands or other parts of the body, so that the human being can orientate himself in the three-dimensional world through haptics and sensor technology as a further sensory sensation and carry out realistic simulations. This allows for the viewer to have a sense of direction in the artificial landscape. Additional haptic feedback can be obtained from omnidirectional treadmills (with which walking in virtual space is controlled by real walking movements) and vibration gloves and suits.
The ongoing virtual reality, augmented reality, and mixed-reality revolution demonstrates the power and potential of immersion in specialty systems and use cases. Challenges such as battery life, computer vision, and pixel density beyond 4K must be addressed for successful AR and VR experiences. All this computation must also be performed within a fixed 2-watt to 3-watt thermal budget, pushing the boundaries of what’s possible with ever-smaller devices.
Industry is developing system on a chip or system on chip (SoC) for AR/VR. SoC is an integrated circuit (also known as a “chip”) that integrates all components of a computer or other electronic system on a single circuit die. Similar to how a microcontroller integrates a microprocessor with peripheral circuits and memory, an SoC can be seen as integrating a microcontroller with even more advanced peripherals like graphics processing unit (GPU), Wi-Fi module, modems or one or more coprocessors– all on a single substrate. It may also contain digital, analog, mixed-signal, and often radio frequency signal processing functions, depending on the application. SoCs connect to other components too, such as cameras, a display, RAM, flash storage, and much more.
Nvidia and AMD lead the VR/AR chip market, but Qualcomm is a formidable competitor. The company’s Snapdragon XR1 chip, launched in October 2018, is the industry’s first VR/AR-specific processor, offering improved battery support, lower temperatures, and a better audio-video experience. Intel and ARM are designing custom chips for VR devices, while programmable chips from Xilinx and Intel and memory-biased chips from Micron and Samsung are also gaining traction. The use of XR1 in Google Glass Enterprise Edition 2.0 has raised expectations that Google’s Daydream VR, presently operating on the Snapdragon 835 smartphone processor, will also get the new chip.
One of the challenges of building AR glasses is battery life, and one of the most battery hungry operations would be the positional tracking and world sensing. Facebook blog post suggested that tracking on AR glasses would need to be 50 times more power efficient as compared with the Oculus Quest’s. The Oculus Quest uses the DSP (Digital Signal Processor) and a “Silver” core (high efficiency low performance secondary core) on the Snapdragon 835 SoC to perform tracking. While this is more efficient than running solely on the generic CPU, a dedicated chip designed for Insight tracking would have the potential to be an order of magnitude more efficient in their use of power.
Drivers, restraints, and opportunities
Surge in demand for AR/VR chips in the gaming sector and increase in need for the adoption of augmented & virtual reality technology in various applications fuel the growth of the global AR/VR chip market. On the other hand, resistance to implement the AR/VR technology and inadequate investments in R&D hamper the growth to some extent. Nevertheless, high-end technological advancement and initiation of industry-specific solution are expected to create multiple opportunities in the industry.
Segment
Device types include head mounted display, head up display, handheld device, gesture tracking device, and projector & display wall.
End user includes gaming, entertainment & media, aerospace & defense, healthcare, and others. Based on region, the market is analyzed across North America, Europe, Asia-Pacific.
The AR/VR chip market is segmented on the basis of chip type, device type, end user, and application. On the basis of chip type, the
market is divided into processor ICs, user interface ICs, and power management ICs.
The processor ICs segment to dominate by 2026
Based on chip type, the processor ICs segment contributed to more than half of the global AR/VR chip market share in 2018, and is expected to maintain its dominance by the end of 2026. The same segment would also grow at the fastest CAGR of 24.1% from 2019 to 2026. The characteristics offered by such chips have made them highly efficient when compared to other embedded systems which, in turn, has driven the growth of the segment. The other segments discussed in the report include user interface ICs and power management ICs.
The head mounted display segment to retain its top share during the period
Based on device type, the head mounted display segment garnered the highest share in 2018, generating more than half of the global AR/VR chip market. The prominent applications of head mounted display in military and police boost the segment growth. The head up display segment, on the other hand, would cite the fastest CAGR of 25.2% throughout the forecast period. This is attributed to its features that allow users to view data without any distraction.
Asia-Pacific, followed by North America, to remain lucrative till 2026
Based on geography, Asia-Pacific, followed by the North America, accounted for the major share, in terms of revenue, in 2018, holding more than two-fifths of the global AR/VR chip market. The same province is also expected to manifest the fastest CAGR of 24.7% during the study period.
The AR/VR chip market is projected to witness healthy growth, especially in the Asia-Pacific and European region. This growth is attributed to high adoption of mobile devices; growth in number of gamers in the region; and increased awareness among the end-user industries regarding the benefits of augmented and virtual reality technology-based solutions.
Nvidia and AMD lead the VR/AR chip market, but Qualcomm is a formidable competitor. The company’s Snapdragon XR1 chip, launched in October 2018, is the industry’s first VR/AR-specific processor, offering improved battery support, lower temperatures, and a better audio-video experience. Intel and ARM are designing custom chips for VR devices, while programmable chips from Xilinx and Intel and memory-biased chips from Micron and Samsung are also gaining traction. The use of XR1 in Google Glass Enterprise Edition 2.0 has raised expectations that Google’s Daydream VR, presently operating on the Snapdragon 835 smartphone processor, will also get the new chip.
The key players profiled in the report include Qualcomm Technologies Inc., NVIDIA Corporation, Imagination Technologies Limited, MEDIATEK Inc., Intel Corporation, Spectra 7, Advanced Microdevices Inc, International Business Machine Corporation, Samsung Electronics Co. Ltd, and Huawei Technologies Co. Ltd. These key players have adopted strategies such as product portfolio expansion, mergers & acquisitions, agreements, geographical expansion, and collaborations to enhance their market penetration.
