Location-based Entertainment Market Size, Share & Trends Report

Location-based Entertainment Market Size, Share & Trends Analysis Report By Component, By End-use (Amusement Parks, Arcade Studios, 4D Films), By Technology, By Region, And Segment Forecasts, 2021 - 2028

  • Published Date: May, 2021
  • Base Year for Estimate: 2020
  • Report ID: GVR-4-68038-118-4
  • Format: Electronic (PDF)
  • Historical Data: 2016 - 2019
  • Number of Pages: 100

Report Overview

The global location-based entertainment market size was valued at USD 3.05 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 34.4% from 2021 to 2028. The growing demand for immersive video content, video games, and other entertainment content, which can potentially trigger the sales of Virtual Reality (VR) headsets, is expected to drive the growth. Advanced Visual Effects (VFX) with sensory stimulus and archaic tactile presented with Location-based Entertainment (LBE) services are particularly expected to contribute to the market growth. The gaming industry is undergoing a paradigm shift and the industry incumbents are looking forward to pursuing technology-driven initiatives. Consumers are seen to be widely adopting VR distinctly with the blend of multiplayer orientated interest in the industry. This, in turn, is encouraging smaller firms to invest in the LBE industry, thereby driving the market's growth.

U.S. location-based entertainment market size, by end use, 2016 - 2028 (USD Million)

The key market players are focusing on integrating state-of-the-art technologies, such as Augmented Reality (AR), VR, Mixed Reality (MR), interactive digital surfaces, and 3D projection mapping, with LBE to deliver high-end immersive experiences to consumers. Major industry participants are investing aggressively in research and development to launch innovative simulation products. Due to consumers’ shifting preferences for out-of-home entertainment, companies are pursuing various initiatives to create more interactive ways for using shared social spaces and assimilating people. For instance, in June 2020, IMAX Corporation partnered with Tribeca Enterprises LLC to work with Tribeca Film Festival's "Tribeca Drive-In" for showcasing over 30 iconic movies in the U.S. The strategic initiative was aimed at assimilating people for storytelling and allowing them to display their creativity using IMAX Corporation’s immersive experiences.

Location-based entertainment can potentially have a significant impact on the life of individuals looking forward to having a social and emotional experience. At this juncture, consumers prefer LBE as they do not have to invest in a simulation device for experiencing an immersive environment. Moreover, as the retail industry continues to witness a paradigm shift, retail stores and malls are leveraging LBE to create a convenient buying experience for shoppers. As such, LBE is expected to create social spaces in malls and community culture centers to provide immersive entertainment for people looking forward to witnessing real-like experiences.

The introduction of 360-degree VR technology is expected to play a decisive role in driving the growth of the location-based entertainment market. The 360-degree content can potentially provide an all-around view of the projected content for the viewers. The introduction of VR-based games with 360-degree content can also offer exciting and immersive experiences to individuals, thereby contributing toward the increasing popularity of 360-degree content and subsequently driving the growth. Such trends are prompting the key market players to collaborate with technology providers and further advance the LBE technology. For instance, in September 2019, StrikerVR, Inc. partnered with Nanoport Technology Inc. for the Linear Magnetic Ram (LMR) haptic technology, TacHammer. As part of the partnership, the company launched Arena Infinity LITE VR peripheral, which is designed to deliver realistic tactile experiences for LBE and VR.

The outbreak of the COVID-19 pandemic has taken its toll on the market. Several LBE centers, such as amusement parks, theme parks, arcades, and theaters, are closed temporarily as a part of the lockdowns imposed in various countries to arrest the spread of coronavirus. At this juncture, these LBE centers can utilize their limited resources critically, engage consumers, offer consumer compelling reasons to return, acquaint customers with ideal practices to mitigate health risks, and adopt data analytics to address the customer needs if they were to gain momentum and attract a large footfall in the post-pandemic era. Key market players are investing aggressively in improving the infrastructure and quality of location-based VR content. For instance, in September 2020, VRstudios, Inc., launched a new foundation, VRstudios Sports, to bring players together in a VR environment to socialize, connect, and share their experiences. VRstudios Sports provides players with an opportunity to explore VR-based gameplays at home with an extended LBE facility.

Component Type Insights

The hardware segment accounted for the largest revenue share of over 65.0% in 2020 and is expected to continue dominating the market growth over the forecast period. The growth of the segment can be attributed to the continued innovations in VR/AR-based gadgets, such as headsets, haptic suits, and other simulation devices. VR-based hardware devices offer viewers an immersive experience in the LBE centers at an affordable price while creating memorable moments for them. The rising adoption of low-end VR headsets by LBE providers particularly bodes well for the growth of the hardware segment. The growing deployment of VR devices for LBE for delivering a high-quality experience to consumers is also expected to contribute to the growth of the segment. For instance, in July 2018, Two Bit Circus launched a micro-amusement park that deploys VR technology for an interactive experience.

The software segment is anticipated to witness the fastest CAGR of over 35.0% from 2021 to 2028. The growth can be attributed to the continued innovations in the software and applications used in LBE services. The growing popularity of mobile-based gaming using VR devices is also expected to drive the growth of the segment. Developers are implementing 3D animation, gesture tracking, guardian systems, and 360-degree cameras to cater to the growing demand for high-end immersive experiences from consumers. At the same time, several companies are also focusing on raising funds for developing technologically advanced LBE applications. For instance, Librestream, an enterprise platform provider, and Augmedics, an AR software provider, raised funds worth over USD 1.0 million in 2020.

End-use Type Insights

The amusement parks segment accounted for the largest market share of around 40.0% in 2020 and is expected to continue dominating the market over the forecast period. Theme parks are increasingly adopting VR-based immersive technology to offer visitors a real-like experience. Amusement parks are also offering several gaming-related activities through location-based VR to enhance the experience for visitors. As such, businesses are also concentrating on deploying technologically advanced, operation-based AR/VR devices at LBE sites. The integration of 3D technology at LBE sites and the increasing consumer spending on outdoor activities are some of the other vital factors that are expected to drive the growth of the segment.

The arcade studios segment is anticipated to register the fastest CAGR of over 35.0% from 2021 to 2028. A looming lack of high-fidelity immersive content in VR headsets at home has been prompting visitors to visit arcade studios. The advanced feature that allows experiencing multiple VR experiences in one commercial setting is particularly driving the popularity of arcades. Entertainment or gaming machines are getting popular at various venues with high footfall, such as VR cafes, restaurants, and bars. The continued enhancement in games to attract more players is expected to drive the growth of the arcade studios segment. On the other hand, the introduction of 4D films and other state-of-the-art technological experiences leveraging 4D haptic movements and holometric chairs are offering exciting, real-like immersive experiences to viewers, thereby driving the growth of the 4D films segment over the forecast period.

Technology Insights

The 3 Dimensional (3D) technology segment accounted for the largest revenue share of over 40.0% in 2020. The growing acceptance of 3D technology in the entertainment industry is anticipated to drive the segment growth. With considerable advances in 3D animation, 3D mapping, and others 3D technologies, the scope of the adoption of 3D technology in LBE has significantly increased. At the same time, the demand for 2 Dimensional (2D) technology has also been considerably consistent over the past few years owing to its wide-ranging applications in the entertainment sector. The extensive adoption of 2D technology in the gaming sector for creating 2D game characters is expected to fuel the growth of the segment.

Global location-based entertainment market share, by technology, 2020 (%)

The Cloud Merged Reality (CMR) segment is anticipated to witness significant growth over the forecast period owing to the unabated advances in technology. Several large technology-based enterprises have extensively adopted CMR owing to its time-saving attributes. The deployment of CMR technology is independent of its location, which means working professionals can access data as and when required. Also, the loss of data using CMR technology is considerably low. Due to its advanced features and convenience of usage, several companies have started preferring CMR technology for their operations. The adoption of CMR is significantly increasing across the gaming and entertainment sectors.

Regional Insights

Asia Pacific is expected to register the fastest CAGR of around 35.0% from 2021 to 2028. Individuals in Asia Pacific have started preferring outdoor leisure activities over other modes of entertainment. Moreover, Asia Pacific is home to several global VR software and hardware providers, which bodes well for the growth of the regional market. The expanding consumer base for VR-based games in China is also expected to contribute to the growth of the regional market. The Middle East and Africa and South America regional markets are also anticipated to witness substantial growth over the forecast period as governments in the regions are encouraging the deployment of LBE technology at popular touristic places to increase the footfall. For instance, the Dubai Mall provides location-based services to its visitors. Several theaters are also adopting VR-based LBE to enhance the immersive experience for visitors.

North America accounted for the largest revenue share of over 35.0% in 2020 and is expected to witness significant growth over the forecast period which can be attributed to the growing awareness about the latest technologies among users & the popularity of LBE, and the subsequent rapid adoption of location-based VR. Also, North America is home to several major market participants. The effective use of location-based VR across various applications in the media and entertainment and gaming industries also bodes well for the growth of the regional market. In Europe, the demand for VR-based LBE is rising in line with the continued inclination of young individuals toward themed attractions, amusement parks, and 4D films. As such, several location-based VR companies have introduced advanced customer service solutions, including social media platforms and chatbots, for receiving reviews and feedback directly from consumers.

Key Companies & Market Share Insights

The market can be described as a moderately fragmented market owing to the presence of many market players. The deployment of VR technology in location-based entertainment is growing constantly in line with the rapid advances in the realm. Several operators are aggressively implementing extended reality in LBE. At the same time, the leading LBE companies have started investing in the entertainment industry. For instance, in August 2019, Disneyland Resort and Walt Disney World opened Star Wars: Galaxy's Edge, a theme park that has successfully deployed VR technology with various fully immersive sights and sounds, and the characters of the Star Wars Universe. The rising popularity of LBE is prompting key market players, such as VRstudios, HTC Corporation, and IMAX Corporations, to invest aggressively in expanding their business. Advances in technology and the incorporation of AR, VR, 3D mapping, mixed reality, and other immersive technologies continue to largely influence the market growth. The growing demand from consumers for high-quality, immersive, and real-like experiences is driving the growth of the market. Some of the prominent players operating in the global location-based entertainment market are:

  • HTC Corporation

  • IMAX Corporation

  • Google LLC

  • Microsoft Corporation

  • Samsung Electronics Co., Ltd.

  • Springboard VR

Location-based Entertainment Market Report Scope

Report Attribute

Details

Market size value in 2021

USD 3.82 billion

Revenue forecast in 2028

USD 30.29 billion

Growth Rate

CAGR of 34.4% from 2021 to 2028

Base year for estimation

2020

Historical data

2016 - 2019

Forecast period

2021 - 2028

Quantitative units

Revenue in USD million and CAGR from 2021 to 2028

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments covered

Component, end-use, technology, region

Regional scope

North America; Europe; Asia Pacific; South America; MEA

Country scope

U.S.; Canada; Mexico; U.K.; Germany; France; China; India; Japan; South Korea; Brazil

Key companies profiled

EXIT Realty Corp. International; Springboard VR; HTC Corporation; IMAX Corporation; The VOID LLC; VRstudios Inc.; Huawei Technologies Co., Ltd.; Google LLC; Microsoft Corporation; Samsung Electronics Co.Ltd.

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Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2028. For this study, Grand View Research has segmented the global location-based entertainment market report based on component, end-use, technology, and region:

  • Component Outlook (Revenue, USD Million, 2016 - 2028)

    • Hardware

    • Software

  • End-use Outlook (Revenue, USD Million, 2016 - 2028)

    • Amusement Parks

    • Arcade Studios

    • 4D Films

  • Technology Outlook (Revenue, USD Million, 2016 - 2028)

    • 2 Dimensional (2D)

    • 3 Dimensional (3D)

    • Cloud Merged Reality (CMR)

  • Regional Outlook (Revenue, USD Million, 2016 - 2028)

    • North America

      • U.S.

      • Canada

      • Mexico

    • Europe

      • U.K

      • Germany

      • France

    • Asia Pacific

      • China

      • India

      • Japan

      • South Korea

    • South America

      • Brazil

    • Middle East & Africa

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