The global metaverse market size reached USD 47.69 Billion in 2020 and is expected to register a significantly rapid revenue CAGR during the forecast period, according to latest analysis by Emergen Research. Rising trend of work from home due to COVID-19 pandemic is one of the major factors expected to drive market revenue growth.

Drivers:

Metaverse can be a game-changer for Work From Home (WFH) jobs. Workforce across various and sectors can engage in a better way with colleagues instead of using video conference. Facebook has already introduced Horizon Workrooms, which is a meeting software for enterprises that work with Oculus VR headsets. Besides, increasing demand for metaverse platforms to purchase digital assets using in-app currency and cryptocurrencies is expected to act as a major catalyst for rapid revenue growth of the market. For instance, Somnium Space is a virtual reality world-building platform that allows for the exchange and ownership of virtual real estate. It is based on blockchain technology and it has its own in-app currency named Somnium Cubes, which can be used to acquire real estate. The selling of VR property is the platform’s primary revenue source, and in-platform real estate could be utilized for activities such as gaming, e-Commerce, social networking, and events. The concept has gained robust traction, and on 29 October 2021, Facebook Inc. announced that the company would henceforth (29 October 2021) be known as Meta Platforms Inc., or ‘Meta’ for short. The company would be committed to developing the immersive digital world known as the metaverse.

Restraints:

However, challenges in convincing users to utilize payment systems in the metaverse is one of the key factors expected to hamper market revenue growth over the forecast period. There is no doubt that metaverse will get its unique type of virtual marketplace, integrating several physical and digital currencies to facilitate quick and easy trading. Whenever it comes to payments, irrespective of currencies and marketplace type, it would be very important to develop unique transaction verification systems. The problem will be convincing users on which platform they can rely on or trust, and more importantly, feel secure during any transaction in the metaverse.

Growth Projections:

The global metaverse market is expected to expand at a CAGR of 43.3% from USD 47.69 Billion in 2020 to USD 828.95 Billion in 2028. Increasing demand for Mixed Reality (MR) to connect with metaverse without virtual reality headsets is propelling revenue growth of the market.

COVID-19 Impact Analysis:

The COVID-19 pandemic has a negative impact across various industries, caused supply chain disruptions, but the same was not the case for the metaverse market. Instead, as a result of the COVID-19 pandemic, people are becoming more informed about the metaverse. Before the virus outbreak, people perceived metaverse as the future of entertainment activities, but during the pandemic, digital learning increased and metaverse has shifted to a paradigmatic revolution in the education industry as well as other industries such as fashion, media & entertainment, aerospace & defence, and others.

Current Trends and Innovations:

Increasing availability of better hardware and software at affordable pricing is expected to open up market growth opportunities in the near future. Virtual Reality (VR) headsets, software, and controllers for Oculus Rift and HTC Hive were previously among the costliest eXtended Reality (XR) devices priced at approximately USD 4,000 when these were initially marketed. Google, Sony, HTC, and Oculus are among the hardware manufacturers making considerably more affordable Virtual Reality headgear. People can now purchase an Oculus Quest 2 set for USD 299. However, lower pricing does not imply a lower dynamic experience for customers. VR is becoming more dynamic and engaging as software and hardware continue to develop. Graphics and animations advancements, sensory enhancements, tactile feedback, and improved movement are all enriching the VR experience thus contributing to its rising adoption.

Geographical Outlook:

Metaverse market in Asia Pacific is expected to expand at a significantly rapid CAGR over the forecast period due to robust presence of major market players including Tencent Holdings Ltd., ByteDance Ltd., and NetEase, Inc. among others in countries in the region. Additionally, in order to develop metaverse platforms, such businesses are partnering with other companies, which is fueling Asia Pacific market revenue growth.

Strategic Initiatives:

Companies included in the global market report include Facebook, Inc., Tencent Holdings Ltd., ByteDance Ltd., NetEase, Inc., Nvidia Corporation, Epic Games, Inc., Roblox Corporation, Unity Technologies, Inc., Lilith Games, and Nextech AR Solutions Corp.