Ed Tech Trends

Virtual and Augmented Reality Poised for Explosive Growth

Virtual and augmented reality are often touted as the next big thing in education. How big? Not nearly as big as textbooks, but heading toward the billion-dollar mark inside of 10 years. 

Virtual and augmented reality are often touted as the next big thing in education. How big? Not nearly as big as textbooks, but heading toward the billion-dollar mark inside of 10 years.

The numbers for education aren’t as staggering as for some other industries. According to investment bankers Goldman Sachs, VR and AR technologies will generate $700 annually from the education sector by 2025. That pales in comparison with videogames in the consumer market ($11.6 billion), events ($4.1 billion) and video entertainment ($3.2 billion).

Other professional sectors are expected to dwarf education in the use of VR and AR as well, including healthcare, the largest user, projected at $5.1 billion, followed by engineering ($4.7 billion), real estate ($2.6 billion), retail ($1.6 billion) and military ($1.4 billion).

That’s about $35 billion in the sectors singled out in the forecast, but Goldman’s overall forecast is upwards of $80 billion by 2025.

Industry seems to be taking forecasts like this one to heart. In the first quarter of 2016 alone, some $1.2 billion in venture capital has poured into VR and AR technologies, according to a report released this month by financial firm Digi-Capital. (Digi-Capital earlier this year forecast total VR/AR revenues of $120 billion by 2020, making Goldman’s $80 billion forecast look downright gloomy by comparison.)

Meanwhile, another VR/AR forecast published this week anticipated $2.3 billion in worldwide spending on hardware devices this year, such as Samsung Gear and Oculus Rift. The report from market research firm IDC, “Worldwide Augmented and Virtual Reality Hardware Forecast, 2016–2020,” forecast total VR unit shipments of 9.6 million units this year and 64.8 million by 2020.

Augmented reality will ramp up more slowly, according to IDC, from a mere 400,000 units this year to 45.6 million units by 2020. Augmented reality typically differs from virtual reality in that it blends the virtual with the real, as in the case of head-up displays in cars that might display a map or driving directions on a windshield or a back-up camera that includes projections and hazard identifiers. It’s also anticipated to be widely used in industry for helping workers perform specialized tasks by overlaying information on (for example) helmet-mounted visors.

"While development kits from players such as Microsoft, Meta, and others point to a strong future in AR hardware, these devices are dramatically harder to produce than VR products," said Tom Mainelli, vice president for Devices & Displays at IDC, in a prepared statement. "Doing this right is more important than doing it fast, and we urge the industry to continue its slow and steady approach to hardware development here, as AR is going to have a profound impact on the way we interact with technology and the way we do our jobs for many years to come. In the meantime, we expect companies to begin experimenting with AR software on devices already in use: smartphones and tablets."

About the Author

David Nagel is editorial director of 1105 Media's Education Technology Group and editor-in-chief of THE Journal and STEAM Universe. A 25-year publishing veteran, Nagel has led or contributed to dozens of technology, art and business publications.

He can be reached at dnagel@1105media.com. You can also connect with him on LinkedIn at or follow him on Twitter at @THEJournalDave (K-12) or @CampusTechDave (higher education).


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