AR & VR - South America

South America

In South America, revenue in the AR & VR market market is projected to reach US$1,578.0m in 2024.
This region is expected to experience an annual growth rate (CAGR 2024-2029) of 9.65%, resulting in a projected market volume of US$2,501.0m by 2029.
The largest market within this market is AR Software, which is anticipated to have a market volume of US$514.9m in 2024.
Notably, most revenue is generated the United States, with a projected market volume of US$10,900.0m in 2024.
In the AR & VR market market, the number of users in South America is expected to amount to 184.8m users by 2029.
User penetration in this region will be 47.0% in 2024 and is expected to rise to 48.6% by 2029.
The average revenue per user (ARPU) in South America is expected to amount to US$9.1.
In South America, the AR & VR market is experiencing a surge in interest from tech startups, driven by innovation and a growing demand for immersive experiences.

Definition:

Augmented reality (AR) and virtual reality (VR) make it possible to combine the real and virtual worlds. AR is generally accessed via mobile phones and primarily relies on lenses. AR effects can be created by using lenses in social media apps, for example. AR is also used for displaying digital 3D objects in our surroundings, e.g., in gaming or eCommerce apps. Meanwhile, VR technology allows users to dive into the virtual world, and, unlike AR technology, it requires a headset device which enables the creation of virtual worlds.

Structure:

The AR & VR market consists of six different markets: AR Advertising, AR Hardware, AR Software, VR Advertising, VR Hardware, and VR Software. AR Advertising covers mobile advertising that is displayed in the most prominent social media apps. AR Hardware comprises AR headsets and glasses. AR Software is divided into three different application types, namely social media, gaming, and eCommerce applications, which can be accessed via the most prominent app stores. VR Advertising covers in-game advertising as well as advertising in VR videos. VR Hardware comprises both tethered head-mounted displays (HMDs) and stand-alone HMD headsets. Lastly, VR Software covers VR games and VR videos, which require headsets.

Additional information:

The market comprises revenues, users, average revenue per user, and penetration rates. Revenues are generated through in-app purchases, advertising spending, and consumer spending on apps, games, and hardware such as headsets or glasses. Sales channel data shows both online and offline revenues, which include VAT. The market only displays B2C revenues and users for the above-mentioned markets and markets; B2B and B2G revenues are not included. Additional definitions for each market can be found on the respective market pages.
Market numbers for VR headsets are also featured in the Consumer Market Insights, namely in the Gaming Equipment market of the Consumer Electronics market. Unlike the VR Hardware market in the Advertising & Media Outlook, the Gaming Equipment market also covers smartphone VR devices.
Key players in the market include companies such as Meta (Oculus VR), Microsoft (HoloLens), Snap Inc. with different lenses, and Nvidia, which offers computing hardware components.
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Analyst Opinion

The AR & VR market in South America is experiencing significant growth and development, driven by customer preferences, market trends, local special circumstances, and underlying macroeconomic factors. Customer preferences in South America are increasingly favoring immersive and interactive experiences, which is fueling the demand for AR & VR technologies.

Consumers are seeking more engaging and personalized experiences, and AR & VR provide a unique opportunity to fulfill these demands. Additionally, the younger population in South America is particularly receptive to new technologies, further driving the adoption and growth of AR & VR in the region. Trends in the market indicate a shift towards the use of AR & VR in various industries.

In South America, the gaming and entertainment sectors have been early adopters of AR & VR technologies, offering immersive experiences to consumers. However, there is also a growing interest in using AR & VR in sectors such as education, healthcare, and tourism. These industries see the potential of AR & VR to enhance learning, training, and customer experiences, respectively.

Local special circumstances in South America contribute to the development of the AR & VR market. For example, the region has a growing number of tech startups and innovation hubs that are focused on developing AR & VR solutions. These startups are driving innovation and creating a supportive ecosystem for the growth of the market.

Additionally, South America has a large pool of skilled technology professionals, who are contributing to the development and implementation of AR & VR technologies. Underlying macroeconomic factors also play a role in the development of the AR & VR market in South America. The region has been experiencing economic growth and increasing disposable incomes, which allows consumers to spend more on leisure activities and entertainment.

This creates a favorable environment for the adoption of AR & VR technologies. Furthermore, governments in South America are recognizing the potential of AR & VR in driving economic growth and are implementing policies to support the development of the market. In conclusion, the AR & VR market in South America is growing rapidly due to customer preferences for immersive experiences, market trends favoring the use of AR & VR in various industries, local special circumstances such as the presence of tech startups and skilled professionals, and underlying macroeconomic factors including economic growth and government support.

As the market continues to evolve, it is expected to offer even more innovative and exciting opportunities for businesses and consumers in the region.

Methodology

Data coverage:

The data encompasses B2C enterprises. Figures are based on the AR & VR market. AR and VR enable consumers to experience a new dimension, using either a headset or installed units, as they combine the real and virtual worlds. Consumer revenue figures refer to revenues relating to AR hardware, AR software, VR hardware, VR software, and spending on AR and VR advertising. Both digital and non-digital revenues are included.

Modeling approach / Market size:

Market sizes are determined through a top-down approach, building on specific predefined factors for each market market. As a basis for evaluating markets, we use annual financial reports of the market-leading companies and industry associations, as well as third-party studies and reports. In addition, we use relevant key market indicators and data from country-specific associations, such as consumer spending, internet penetration, 4G coverage, and historical developments. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption. The main drivers are level of digitalization, adoption of technology, GDP per capita, and internet penetration.

Additional notes:

The market is updated twice a year in case market dynamics change. The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level. In some cases, the data is updated on an ad hoc basis (e.g., when new, relevant data has been released or significant changes within the market have an impact on the projected development).