Virtual reality (VR) and augmented reality (AR) will have "a powerful impact" on sectors such as education over the next four years, according to IDC.
The market watcher forecasts that worldwide VR and AR spending will increase at an annual rate of 181.3 per cent between 2015 and 2020 – rising from $5.2bn (£4bn) this year to more than $162bn in 2020.
Chris Chute, vice president of customer insights and analysis at IDC, claims that VR will have an impact at an "industrial level" after already seeing success in healthcare.
"For many years augmented and virtual reality were the stuff of science fiction. Now with powerful smartphones powering inexpensive VR headsets, the consumer market is primed for new paid and user-generated content-driven experiences," he said.
"Recent developments in healthcare demonstrated the powerful impact augmented reality headsets can have at industry level, and over the next five years we expect to see that promise become realised in other fields such as education, logistics and manufacturing."
Sales of VR and AR hardware will generate over half of the worldwide revenue in the forecast period, while software revenues are set to grow 200 per cent year on year in 2016.
Software sales will however be overtaken by services revenue halfway through the forecast period as sectors such as logistics and manufacturing demand enterprise-class support, IDC claimed.
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