Europe Location-based Entertainment Market Size, Share & Trends Analysis Report By Component (Hardware, Software), By End Use (Amusement Parks, Arcade Studios, 4D Films), By Technology, By Country, And Segment Forecasts, 2023 - 2030

Report Overview

The Europe location-based entertainment market size was valued at USD 911.6 million in 2022 and is expected to grow at a compound annual growth rate (CAGR) of 28.4% from 2023 to 2030. The significant growth is attributed to the increasing consumer inclination toward amusement parks, arcade studios, 4D films, etc. for entertainment. Rapid urbanization, rise in disposable incomes, and increase in international tourism trends are major factors boosting the growth of the market. The market players are offering Virtual Reality (VR) attractions under one roof, attracting more visitors. The increasing adoption of VR arcades is positively influencing the market outlook. VR arcade theme parks are gaining immense popularity as they let multiple users wear a VR headset to play games simultaneously, providing them with the experience of being inside a game.

The increasing demand for interactive and immersive entertainment has further fueled the growth of Augmented Reality (AR) in the entertainment sector. AR technology has revolutionized the way people engage with entertainment venues across Europe. It enables the integration of virtual elements into real-world environments, offering unique and interactive experiences.

Some critical applications of AR in the market, have enhanced the traditional theme park experience by overlaying virtual elements, such as characters of interactive games, onto physical rides and environments. This allows visitors to embark on virtual adventures while enjoying a real-world setting. AR has breathed new life into museums and exhibitions by providing visitors with augmented content, such as virtual guides, 3D models, and interactive narratives. This interactive layer adds depth and engagement to the traditional static displays attracting a broader audience.

AR has revolutionized how sports events and gaming experiences are enjoyed, from AR-enhanced stadium experiences to location-based AR games like Pokemon GO. It has enabled fans and players to engage with their favorite sports and games in a more immersive and interactive manner. AR technology has played a significant role in showcasing European cultural heritage and promoting tourism by overlaying virtual information and reconstruction onto historical sites. AR provides visitors with an informative and visually appealing experience, bringing history to life.

Infrastructure development plays a vital role in supporting the growth of the market in Europe. Improved transportation networks, including efficient road systems and public transportation, facilitate the accessibility of venues, attracting larger audiences from both local and regional areas. Additionally, the availability of adequate utilities, such as electricity and internet connectivity, is crucial for operating advanced technologies and interactive experiences offered by establishments.

Furthermore, developing mixed-use complexes and urban regeneration projects provides suitable spaces for establishing location-based entertainment venues. These complexes combine commercial, residential, and entertainment components, creating vibrant destinations that cater to diverse consumer preferences. Integrating parks and studio venues into this urban development enhances their attractiveness and contributes to the overall urban experience.

To survive the pandemic, operators in Europe had to innovate and adapt to the changing circumstances. Many operators pivoted to digital platforms, offering virtual experiences and online events to engage with their audience remotely. This allowed them to maintain a connection with customers and generate some revenue during the closures. Entertainment Park operators implemented rigorous safety protocols, including increased sanitization, temperature checks, and reduced capacity limits.

These measures aimed to rebuild trust among visitors and create a safe environment for their return. Some operators explored partnerships with other industries or diversified their offerings to cater to changing consumer preferences. For example, theme parks introduced drive-through experiences or outdoor festivals to comply with social distancing guidelines.

The covid-19 pandemic had a severe impact on the market in Europe. However, the industry can gradually recover by embracing innovation, implementing stringent safety measures, and adopting recovery strategies. Amusement park operators must adapt to changing consumer behavior and leverage technology to provide immersive and safe experiences.

Component Insights

The hardware component segment accounted for the largest market share of over 64.0% in 2022. The demand for the hardware profoundly increased after the introduction of VR headsets. Several industry participants acknowledged large investments for technological improvements in these headsets to attain a competitive edge in the market. The technology paved the way for the popular concept of arcade studios offering a simulated experience to visitors in limited physical spaces. This hardware has enriched the premium out-of-home social experiences and is expected to contribute to the market share of the hardware segment throughout the forecast period.

The rapid increase in mobile-based gaming technology with the deployment of VR devices results in the growth of the hardware segment. Furthermore, ensuring seamless integration and compatibility between various hardware components can be complex. The future of hardware component development in Europe's market seems promising. Advancements in technology, including miniaturization, wireless connectivity, and improved user interface, will continue to drive innovation. Additionally, integrating artificial intelligence and machine learning into hardware components could enhance user experience.

The software component segment is expected to grow at a significant CAGR of over 30.0% over the forecast period. The growth is primarily characterized by a prevalence of state-of-the-art technologies such as AR, VR, and mixed reality that have emerged as anticipatory frameworks owing to their widespread applications in various domains. Several theme park operators are making significant investments in VR technology to provide visitors with a unique experience.

According to a study conducted by The Week, VR technology has become a crucial and growing factor in the development of theme parks. The study analyzed 23 manufacturers of roller coasters across Europe and eight of them had implemented VR technology into at least one of their roller coasters.  Software developers are continually improving the systems to assist their clients in creating unique content without letting end-customers move naturally at the end-use locations. The integration of immersive technology such as virtual reality, 3D mapping, augmented reality, and mixed reality is expected to drive the growth of the software segment in the market. The proliferation of high-quality immersive content such as games, movies, videos, advertisements, programs, and others with various applications drives the software segment in the market.

End-Use Insights

The amusement park end-use segment accounted for a substantial market share of over 38.0% in 2022. Indoor amusement parks offer a range of attractions and entertainment options in a controlled environment, making them popular among families, tourists, and thrill-seekers. Several factors have contributed to the growth of indoor amusement parks in Europe. Unpredictable weather conditions in many European countries make indoor attractions a more reliable option for entertainment throughout the year.

This factor has driven the demand for indoor amusement parks, as visitors can enjoy various rides and activities regardless of the weather outside. Indoor amusement parks often provide diverse attractions, including roller coasters, indoor playgrounds, virtual reality experiences, laser tag, and arcade games. Outdoor amusement parks provide visitors with a unique and immersive experience, allowing them to create lasting memories with friends and family. Europe is a popular tourist destination, attracting millions of visitors worldwide. Outdoor amusement parks capitalize on this influx of tourists by offering entertainment options catering to local and international visitors. Amusement parks are constantly evolving to incorporate new technologies and attractions. European parks have embraced new cutting-edge technologies such as virtual reality, augmented reality, and interactive experiences to enhance this thrill and engagement for visitors.

The arcade studio end-use segment is expected to grow at the highest CAGR of over 30.0% over the forecast period. Arcade studios have expanded their offering beyond traditional games to include various experiences. The diversification includes a wide range of experiences. This diversification includes virtual and augmented reality games, interactive simulations, escape rooms, multiplayer experiences, immersive storytelling, and experiential installations. By providing diverse experiences, arcade studios attract a broader audience and cater to different preferences and demographics. Technological advancements have played a significant role in the growth of arcade studios in the market. The availability of high-quality VR and AR hardware, motion tracking systems, haptic feedback devices, and other immersive technologies has enabled arcade studios to create more realistic and engaging experiences.

Technology Insights

The 3-dimensional technology segment accounted for the highest market share of over 43.0% in 2022. 3D technology is integral to creating realistic virtual environments and rendering three-dimensional objects and characters. VR headsets provide users with a stereoscopic display, delivering depth perception and enhancing the sense of presence within the virtual world. 3D modeling and animation tools have become increasingly sophisticated, allowing creators to design and develop intricate and realistic virtual worlds, characters, and objects. These tools enable the creation of lifelike visuals, textures, and animations that enhance the immersion and visual quality of experiences. Holographic displays utilize 3D technology to create three-dimensional images that appear to float in space without special glasses or headsets. Theme parks and arcade centers utilize holographic displays to showcase lifelike holograms of characters, objects, or interactive elements, creating a sense of wonder and awe.

Cloud-merged reality technology is anticipated to grow with a significant CAGR of around 30.0% during the forecast period. The convergence of simulated solutions and the real world has created intuitive ways for the advancements in Mixed Reality (MR) environments. Cloud MR technology offers an add-on for the market as it evokes an emotional connection between the users and the content. 

The CMR technology allows users to have easy access to data irrespective of time and location. The easy accessibility and decreased chances of losing data in CMR-based technology have made it a highly convenient and preferred technology by tech developers across various industry verticals. The ability of cloud MR technology-based solutions to choreograph the actions and create an in-home environment is projected to foresee significant growth during the forecast period.

Country Insights

Germany accounted for the highest market share of over 28.0% in 2022. Germany is one of the leading economies in Europe and has a thriving entertainment and leisure industry. Germany has experienced significant growth during the forecast period, driven by technological advancements, increasing consumer interest in immersive experiences, and the demand for unique entertainment options.

Virtual reality has been a key driver of growth in the German market. VR arcades and gaming centers have gained popularity, allowing visitors to experience high-quality VR content without the need for expensive equipment at home. These establishments provide a range of experiences, including gaming, simulations, and immersive storytelling. Germany's theme parks and amusement parks have been investing in new technologies and attractions to enhance visitor experiences. Incorporating VR, AR, and interactive elements into traditional rides and attractions has become a trend to attract and engage visitors.

Germany has focused on creating multi-sensory experiences that engage multiple senses, including sight, sound, touch, and even smell. This experience enhances immersion and provides a more realistic and captivating environment for visitors. Incorporating interactive and gamified challenges and competitive experiences encourage active participation from visitors.

France is anticipated to record a significant CAGR of around 30.0% from 2023 to 2030. France has experienced an increase in demand for immersive and interactive entertainment experiences, including the rise of VR, and arcades, among others. The established theme parks in France, such as Disneyland Paris, continue to invest in new technologies and attractions to enhance visitors' experiences. They incorporate VR, AR, and interactive storytelling elements to engage visitors and provide unique entertainment.

Escape rooms have also seen substantial growth in the market. These interactive puzzle-solving experiences have become popular among groups of friends, families, and corporate teams. Escape rooms offer immersive themes and storylines that engage participants, creating memorable and exciting experiences. For example, The Palace of Versailles, a UNESCO World Heritage site and a symbol of French history and grandeur, has integrated VR and AR technologies to provide immersive and educational experiences for visitors. Through VR headsets, visitors can virtually explore the palace and its garden as they were in different historical periods, gaining a deeper understanding of the architecture, décor, and lifestyle of the time. This VR experience allows visitors to teleport in time and witness the palace’s transformation throughout history.

Key Companies & Market Share Insights

The key players in the Europe location-based entertainment market have seen significant growth and transformation in recent years.The market is consolidated with the strong presence of several leading market players, such as the Walt Disney Company; Universal Parks and Resorts; Six Flag Entertainment Corporation; Cinepolis, etc. The deployment of VR technology in location-based entertainment is growing constantly in line with the rapid advances in the field. The major technology providers include Microsoft Corporation; Google LLC; VRstudios, Inc.; Springboard VR; HTC Corporation, etc.

In January 2023, Microsoft Corporation announced its plans to shut down its VR social network AltspaceVR due to the promotion of the self-made VR and AR portal Mesh for Teams and HoloLens. The demand and opportunity for VR and AR are constantly expanding. The major focus of shutting down is on their product launch as Microsoft has launched its own VR experience portal named Microsoft Mesh, which gives VR experience in Microsoft Teams.

In January 2023, Disney collaborated with Apple Inc. to develop virtual reality content for mixed reality headsets. Apple is manufacturing its own VR headset with the collaboration of Sony Group Corp., which comes with two ultra-high-resolution displays to manage the VR aspects. Disney and Sony are helping Apple by providing virtual reality content to be played on their mixed-reality headsets. Some prominent players in the Europe location-based entertainment market include:

• Microsoft Corporation

• Google LLC

• HQ Software

• HTC Corporation

• Samsung Electronics Co. Ltd.

• Niantic Inc.

• Magic Leap Inc.

• VRstudios Inc.

• Huawei Technologies Co. Ltd.

• Springboard VR

• Cinepolis

• Disney Parks, Experience, and Products

• Universal Parks and Resorts

• Six Flags Entertainment Corporation

• AEON Fantasy Company

• Barron Games International

• KidZania Operations S.A.R.L.

Europe Location-based Entertainment Market Report Scope

Europe Location-based Entertainment Market Report Segmentation

This report forecasts revenue growth at regional & country levels and analyzes the latest industry trends in each sub-segment from 2018 to 2030. For this study, Grand View Research has segmented the Europe location-based entertainment market report based on component, end-use, technology, and country:

• Component Outlook (Revenue, USD Million, 2018 - 2030)

  • Hardware

  • Software

• End-Use Outlook (Revenue, USD Million, 2018 - 2030)

  • Amusement Parks

    • Indoor Amusement Parks

    • Outdoor Amusement Parks

  • Arcade Studios

  • 4D Films

• Technology Outlook (Revenue, USD Million, 2018 - 2030)

  • 2-Dimensional (2D)

  • 3-Dimensional (3D)

  • Cloud Merged Reality (CMR)

• Regional Outlook (Revenue, USD Million, 2018 - 2030)

  • Germany

  • UK

  • France

  • Rest of Europe