Mammoth AR and VR boom predicted

Virtual reality (VR) and augmented reality (AR) devices are about to explode into mainstream consciousness – you only have to have a quick scan of the big E3 2015 stories to realise that.

And now we have some figures to go with the hype, as CCS Insight has predicted the VR and AR device market is on course to become a $4 billion-plus business inside three years.

The industry analyst has forecast that 2.5 million devices will be shifted in 2015 – rising to a staggering 24 million by 2018.

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With headsets like Oculus Rift, Project Morpheus, the HTC Vive and Microsoft's HoloLens all making big waves – it's perhaps not surprising that CCS is forecasting such a boom in popularity.

Virtual reality covers the immersive, virtual world experiences presented by the likes of Oculus Rift and the PlayStation powered Project Morpheus from Sony. Augmented reality is a blurring of the real and virtual worlds, with digital information overlaid on a user's view – as demonstrated by Google Glass and, more excitingly, Microsoft's HoloLens. Check out the awesome Minecraft demo Microsoft put on at E3 earlier this week for an example of what we mean. But it's not all fun and games.

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Ben Wood, CCS Insight's chief of research explained: "Despite the reputational damage done to the consumer smart glasses segment by Google Glass, companies have realised augmented reality can be used to increase productivity and cut costs.

"Over the next two years we're going to see the technology move out of trials into full-scale deployments. Companies that embrace augmented reality will gain a competitive advantage."

VR has the potential to hit a mass scale more rapidly than AR because of the smartphone VR movement. Google Cardboard and its apps offer the easiest way to experience virtual reality today. The system consists of a low-cost, DIY virtual reality headset that anyone can build, and a software platform that makes it incredibly easy for app developers to add VR support to their creations.

The CCS report predicts that 90% of VR device sales in 2018 will be smartphone powered ones, rather than standalone experiences.

"For only a few dollars, consumers can dip their toe in the water with an inexpensive holder for a compatible smartphone," explained Wood. We expect this democratisation of the technology to deliver growth not just in affluent mature markets but also in emerging markets where smartphone penetration is stronger than ever."

With most of the biggest players in tech heavily invested in AR and VR – Google, Microsoft, Facebook, Valve, Samsung, Sony and more – and movements like Razer's OSVR platform now in full swing (144 major partners and growing), CCS' forecasts could well be on the money.