Global shipments of VR and AR headsets fell 67.4 per cent year-on-year in Q1 2024, IDC revealed, attributing the downward trend as being due to a market transitioning to include technologies such as mixed and extended reality.

IDC described the drop in VR and AR headset shipments as “expected,” though it noted an anticipation of a return to growth once the new categories gain wider acceptance.

VR technology enables users to interact in a fully virtual or computer-generated environment, while AR presents an overlay of digital content onto the real-world surroundings. MR technology blends the two, allowing consumers to interact in a 3D spatial environment.

IDC noted Meta Platforms led the market in Q1, with Apple taking second place with the Vision Pro. ByteDance, Xreal Technology and HTC completed the top five brands in the space.

The introduction of Apple into the market and Meta’s focus on the premium Quest 3 was credited with helping push the average selling price (ASP) for headsets above $1,000, though the analyst company expects this figure to come down over time.

IDC noted “the Quest 3 and the Vision Pro helped educate users and enticed developers to create mixed reality content, blending the digital and physical worlds”, though this has come “at a premium for users”. Though it added there were cheaper offerings already available on the market.

The company’s research director in its AR and VR team Ramon Llamas said “Looking ahead, we anticipate ASP erosion across all products.”

“Because the overall market is still in its early stages with more expensive first- and second-generation devices, prices will be high even as early adopters buy them. In order to reach scale in the mass market, vendors will need to reduce prices on later and upcoming devices.”