Augmented Reality  Gaming Market Size 2024-2028

The augmented reality (AR) gaming market size is forecast to increase by USD 69.04 billion at a CAGR of 47.7% between 2023 and 2028. Augmented Reality (AR) gaming market is experiencing significant growth, driven by increasing investments in AR technology and the rising adoption of AR games. Notable players in the venture capital industry, such as Alphabet's GV, have recently led funding rounds for sports VR startups, further fueling market expansion. However, the high cost associated with AR gaming applications may hinder the mass adoption of this technology. Despite this challenge, the popularity of AR gaming continues to soar, with consumers seeking deep and interactive gaming experiences. VR software developers are responding to this demand by creating more engaging and affordable AR games, making the future of this market promising.

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The augmented reality (AR) gaming market is experiencing exponential growth, driven by the integration of AR technologies into various devices and the increasing demand for deep gaming experiences. AR games offer a unique blend of the virtual world and the existing environment, providing an interactive and engaging experience for users. AR games are becoming increasingly accessible to a wider audience due to the decreasing cost of AR technologies and the availability of devices such as tablets, laptops, portable gaming systems, mobile phones, and wearable devices that support AR gaming. AR games offer real-time synchronization between the virtual world and the physical environment, allowing for seamless integration and a more deep experience. This synchronization is made possible by the use of AR technologies, which can track head movements and overlay virtual objects onto the real world. AR games offer high-quality audio and visual content, creating a more engaging and emotional experience for users. Stereoscopic images and 3D graphics are commonly used to enhance the visual experience, while spatial audio and haptic feedback are used to enhance the audio experience. AR gaming is often compared to virtual reality (VR) gaming, but the two technologies offer distinctly different experiences.

Additionally, while VR games create a completely virtual environment, AR games overlay virtual objects onto the real world, allowing users to interact with both the virtual and physical environments simultaneously. AR games offer a social and emotional experience, allowing users to connect with others in a virtual world and engage in collaborative gameplay. The use of AR technologies also allows for more realistic and emotional interactions, creating a deeper connection between players. Further, AR games offer mental stimulation and challenge users to think critically and strategically. The interactive and deep nature of AR games can also help improve mental agility and focus While some AR games require the use of a headset, many can be played on mobile devices without the need for additional equipment. Regardless of the device used, AR games offer a high level of presence and immersion, transporting users to a virtual world where they can explore, interact, and engage in exciting gameplay. In conclusion, the AR gaming market is poised for significant growth due to the increasing availability and affordability of AR technologies and the demand for deep and interactive gaming experiences. AR games offer a unique blend of the virtual and physical worlds, providing users with a more engaging and emotional experience that can be enjoyed on a variety of devices.

Market Segmentation

The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD million" for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.

• Type
  • Mobile devices
  • HMDs
  • Smart glasses
• Component
  • Hardware
  • Software
• Geography
  • North America
    • Canada
    • US
  • Europe
    • UK
  • APAC
    • China
    • Japan
  • Middle East and Africa
  • South America

By Type Insights

The mobile devices segment is estimated to witness significant growth during the forecast period. The mobile segment held a significant share in the global AR gaming market in 2023, and it is expected to continue leading the market during the forecast period. Mobile devices, including smartphones and laptops, are preferred for AR gaming due to their convenience and portability. AR gaming companies are increasingly investing in AR technology to offer deep gaming experiences on these devices. The affordability and accessibility of AR games on mobile platforms are major growth drivers for the market. 

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The mobile devices segment was valued at USD 2.19 billion in 2018. In AR gaming, synchronization of audio and visual content in real-time is crucial for an engaging user experience in both the virtual world and the existing environment. Mobile devices offer the necessary processing power and connectivity to ensure seamless synchronization, making them the go-to choice for AR gaming enthusiasts.

Regional Analysis

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North America is estimated to contribute 40% to the growth of the global market during the forecast period. Technavio's analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.

The global AR gaming market is witnessing significant growth due to the integration of advanced technologies like AR, VR, IoT, and MR. In 2023, North America led the market, with a dominant share, driven by the presence of key players and consumer interest in deep gaming experiences. Qualcomm, a prominent tech company, is one such player, investing heavily in AR technology. In March 2022, Qualcomm announced the Snapdragon Metaverse Fund, committing up to USD 100 million to developers and companies creating innovative XR experiences, including AR technologies and related AI. Mobile phones and wearable devices are the primary platforms for AR gaming, offering users interactive environments that blend the physical and digital worlds. The market's growth is expected to continue as technology advances and consumer demand increases.

Our researchers analyzed the data with 2023 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

Key Market Driver

The increasing investments in AR technology is notably driving market growth. Augmented Reality (AR) gaming is an emerging technology that is witnessing substantial investment from major players and startups. This technology is poised for use in various sectors, including social media, mobile devices, retail, healthcare, and automotive industries. AR's deep nature requires advanced hardware, such as headsets capable of displaying stereoscopic images and motion controllers, as well as innovative technologies like treadmills, to provide presence and immersion.

Also, the delivery of real-time information necessitates significant data processing power and transfer, which calls for substantial investment. Google, for instance, has launched projects like Tango and ARCore to enable AR experiences on Android devices. As AR continues to gain traction, it is expected to revolutionize industries and transform user experiences. Thus, such factors are driving the growth of the market during the forecast period.

Significant Market Trends

The rising adoption of AR games is the key trend in the market. Augmented Reality (AR) gaming represents an innovative sector in the digital entertainment industry, merging virtual elements with real-world surroundings in real time. The expanding usage of smartphones and tablets, coupled with the escalating internet penetration, fuels the expansion of the global AR gaming market. AR game developers are releasing mobile applications to expand the user base and popularize AR gaming.

Further, one notable example is Pokemon GO, an adventure game developed by Niantic, which integrates virtual creatures into real-world environments, creating a deep gaming experience. AR technology also enables the generation of hyper-realistic virtual worlds, with procedural content creation and realistic textures, enhancing the overall gaming experience. Online collaboration and remote work are additional features that are gaining traction in AR gaming, offering players the ability to interact with one another in real time. Thus, such trends will shape the growth of the market during the forecast period.

Major Market Challenge

The high cost associated with AR gaming applications is the major challenge that affects the growth of the market. The Augmented Reality (AR) gaming market has witnessed significant interest from investors and startups due to its potential to revolutionize the entertainment industry. Notable investors, such as Alphabet's GV, have funded several sports VR startups, indicating the growing popularity and adoption of AR gaming. However, the development of AR gaming solutions requires substantial time and resources, depending on the complexity of the applications.

However, simple product visualizations come with lower production costs compared to intricate, highly interactive standalone games. Realistic animations and intuitive user interfaces are essential features that add to the expense of AR gaming solutions. Consequently, the high investment required for creating advanced AR gaming applications may hinder the market's growth during the forecast period. Hence, the above factors will impede the growth of the market during the forecast period.

Exclusive Customer Landscape

The market forecasting report includes the adoption lifecycle of the market, covering from the innovator's stage to the laggard's stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth analysis strategies.

 Customer Landscape

Key Companies & Market Insights

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

Augmented Pixels Inc. - The company offers AR game called WarBot, which is a shooting game made for kids and adults.

The market research and growth report also includes detailed analyses of the competitive landscape of the market and information about key companies, including:

• Augmented Pixels Inc.
• Blippar Ltd.
• Hofli Ltd.
• HP Inc.
• Milkroom Studios GmbH
• Netmarble Corp.
• Niantic Inc.
• OliveX Holdings Ltd.
• Qualcomm Inc.
• Rovio Entertainment Corp.
• Total Immersion Inc.

Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.

The augmented reality (AR) gaming market is experiencing significant growth due to the increasing affordability and availability of AR technologies. The deep experience offered by AR games, which overlays virtual content onto the existing environment, is driving the demand for these innovative games. The real-time synchronization of audio and visual content in AR games creates a more engaging and interactive environment. AR games are not limited to specific devices, as they can be played on tablets, laptops, portable gaming systems, and even mobile phones. The use of AR technologies in gaming provides emotional and mental stimulation, making it a popular form of entertainment in the industry. The AR gaming market is also expanding into education, offering enhanced learning techniques through interactive gameplay. However, privacy concerns and the protection of personal information for anonymous gamers remain a challenge. AR and virtual reality (VR) technologies are advancing, with the development of headsets, stereoscopic images, head movements, and presence and immersion. Motion controllers, treadmills, and other VR hardware and software are also gaining popularity, leading to increased technology investment in the gaming market. The adoption of AR and VR technologies is expected to continue, with the development of hyper-realistic virtual worlds, procedural content generation, and realistic environments with textures and game rules. The integration of generative AI and object identification is also expected to enhance the gaming experience, providing a more interactive and deep environment for players. The entertainment industry is embracing AR and VR technologies, with startups receiving funding for sports VR and remote work and online collaboration applications. The future of gaming is promising, with the potential for even more innovative and interactive experiences.

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What are the Key Data Covered in this Market Research Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the market growth and forecasting between 2024 and 2028
• Precise estimation of the size of the market  and its contribution of the market in focus to the parent market
• Accurate predictions about upcoming market growth and trends and changes in consumer behaviour
• Growth of the market across North America, Europe, APAC, Middle East and Africa, and South America
• Thorough analysis of the market's competitive landscape and detailed information about companies
• Comprehensive analysis of factors that will challenge the growth of market companies

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