Revenues from virtual reality specific games to reach $8.2bn by 2023

A new study from Juniper Research has found that revenues from virtual reality (VR) specific games will reach $8.2 billion (€7.2bn) by 2023, up from $1.2 billion in 2019.

However, the development of smartphone content is necessary to increase consumer confidence in VR across the platforms, the Juniper report said, noting 2018 was a disappointing year for hardware sales. It said low-cost mobile content would be needed to engage users, and a profitable content market would be needed to sustain hardware sales across the board.

Juniper said more than 100 million mobile VR devices such as smartphone and standalone headsets would access games globally by 2023. That is almost double the level of 52 million devices expected this year.

Mobile VR is set to account for more than half of total VR games revenues by 2023.

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"Revenues from VR-specific mobile games will exceed $4.6 billion by 2023. However average revenue per mobile VR games user will be the lowest of all VR platforms," said research author Sam Barker. "In response, app developers must mitigate high app abandonment rates by providing engaging and continually-updated content."

Monetising games through advertising is difficult in mobile VR applications; Juniper predicts more than half of mobile VR games accessed in 2019 will not be monetised due to the difficulty of implementing advertising without affecting user experience. Instead, in-app purchases are the most likely way to recover the shortfall.

VR content revenues are expected to outstrip hardware sales in 2023.