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2023 will be a pivotal year for VR: Which headset will you buy?

As prices finally start to drop and more options hit the market -- potentially even Apple's headset -- Meta's dominance in VR will be put to the test, IDC says.
stephanie-condon
Written by Stephanie Condon, Senior Writer on
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Image: shuter/Shutterstock

The market for virtual reality headsets continues to grow at a swift pace, according to new data from IDC, but so far it's largely dominated by Meta (formerly known as Facebook). Next year could prove to be a turning point for the market, however, as prices start to drop and more options hit the market. 

In the first quarter of 2022, Meta controlled 90% of the market for VR headsets, according to IDC. Meta's Oculus Quest 2 is immensely popular, the research firm noted, while Meta's serious investments in the metaverse allow it to offer exclusive content and hardware at subsidized costs. 

Meta's closest competitor in this space is ByteDance's Pico, which in Q1 captured just 4.5% of the market. Pico largely operates within China, but it recently expanded into several European countries and has a growing library of consumer-oriented content, IDC notes. 

SEE: Metaverse: Momentum is building, but companies are still staying cautious

Rounding out the top five headset providers in Q1 were DPVR, HTC, and iQIYI, with less than 4% market share combined. 

Global shipments for VR headsets jumped 241.6% in Q1 compared to the same period last year, with continued demand and easing supply driving growth. For the full year, IDC expects to see 13.9 million VR headsets ship, up 26.6% from the year prior. 

According to the research firm, sales should surpass 20 million units in 2023, and the average selling price should hit its peak. Consumers next year should benefit from next-gen headsets -- from Meta, but also from Pico and Sony. Apple may finally release its highly anticipated mixed reality headset in 2023 as well, which analysts have said will be a "game-changer."

It's unclear, however, how quickly Apple and other headset makers can put a dent in Meta's market dominance. 

"All eyes will be on Apple as it launches its first headset next year, and while it is tempting to imagine the company shipping high volumes, keep in mind that this is its first headset that will appeal primarily to a small audience of early adopters and Apple fans," IDC research director Ramon Llamas said in a statement. 

"Further iterations will likely show evolution that will grow by leaps and bounds," Llamas added. "In the meantime, companies like Meta and Sony already have a strong installed base and pent-up demand that they can tap into."

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Source: IDC

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