The global virtual production market size is expected to reach USD 6.78 billion by 2030, according to a new report by Grand View Research, Inc. The market is anticipated to register a CAGR of 18.2% from 2023 to 2030. The rising popularity of virtual production in the media and entertainment industry, combined with its capabilities to create high-definition visuals and real-time virtual environments, is the key factor propelling the growth of the market.
The technology enables filmmakers to reduce the demand for on-set production teams and crew members by integrating virtual background environments into live-action footage. This allows for a significant reduction in video production costs. For instance, in 2020, after the covid-19 pandemic, filmmakers in the Hollywood industry found the hi-tech solution of shooting without gathering 100s of people on set. The use of techniques such as cloudbusting, stagecraft LED setup, and robotic camera to shoot actors remotely, known as the Solo Cinebot has helped the filmmaker a lot. Technological advancement in virtual production helps broadcasters improve their operational efficiency with the least physical presence of technicians in the broadcasting room.
For instance, in March 2020, Sky Sports implemented a virtual production suite, which has enabled its teams to create content and stream it remotely. The suite connected 48 virtual workstations and an equal number of direct-to-workstation connections for remote editing, simultaneous live programming, and the distribution of live clippings directly on social media platforms. Although virtual production can produce a film with better visuals and low production costs, it also poses some challenges, especially from the lack of training and experience among industry professionals.
For instance, in May 2022, Mo-Sys Academy, a manufacturer of virtual production solutions in the U.K. announced the launch of a new virtual production course. This course intends to close the skills gap in the virtual production sector, which is experiencing a surge in demand for trained technicians.
With the advent of artificial intelligence, virtual production technology has witnessed significant improvements in the quality of its computer-generated graphics. Design and visualization of all complex scenes in a three-dimensional model have become convenient, further editing and reviewing in a real-time environment. The technology positively impacts the market by reducing the transportation and logistics costs of crew members and equipment. It enables filmmakers to capture on-set live-action scenes through simul-cams or virtual cameras and seamlessly merge computer-generated 3D graphic elements with the film's live-shooting footage to conclude with the final visual effects.
The evolution of VFX technologies and the growth of animation are boosting the entertainment industry. For instance, in July 2022, Netflix, a subscription streaming service and production company in the U.S. announced a plan to acquire Animal Logic, an Australian animation, and visual effects digital studio. This initiative will help Netflix accelerate its efforts to develop end-to-end animation production capabilities.
Furthermore, artificial intelligence facilitates pre-production support that helps to accelerate video production work. In the previous decade, pre-production works heavily relied on unstructured box office data and limited demographic information related to viewers, leading to less engaging video content development. However, now artificial intelligence can generate insights from large data sets collected from various platforms to understand the proposed content's acceptance and interest.
For example, Netflix creates video content based on accurate, personalized recommendations and observations of its users' behavior, such as surfing history, claims, and data actions like pausing or rewinding videos. Also, in April 2021, the company decided to invest USD 17 billion to create a dedicated database to develop original content based on its platform's collected data. Artificial intelligence technology can also help understand scripts and screenplays to recognize the locations described and suggest real-world locations where directors can imagine and create realistic computer graphic imagery locations.
The growing implementation of virtual production in the gaming industry also works well for the market. Factors such as leveraging a three-dimensional environment, increased focus of companies on developing compact and comfortable virtual gaming devices, and constant technological innovation on virtual production platforms, such as 3D audio, untethered virtual reality headsets, and cloud scalability, are expected to drive market growth across gaming applications.
Furthermore, introducing an immersive experience allows for 360° views of graphic content and a new level of gaming interaction, enabling players to control and modify the gaming environment through their senses. This made the interaction with the video games smoother for the player. Hence the increased application of virtual production technology in games is expected to propel the growth of the market.
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In terms of end-user, the movie segment is expected to contribute a significant amount of revenue to the market over the forecast period. The growth can be attributed to the rising demand for visual effects and a three-dimensional model in movies
In terms of components, the software segment is expected to grow at a significant rate owing to the inclusion of artificial intelligence. The inclusion is expected to improve the performance of animation and graphics quality
The North American region holds the maximum revenue share of 37.0% in 2022. The growth is attributable to the increasing adoption of advanced VFX and virtual production technologies coupled with the high implementation of virtual production by leading regional film studios, such as Viacom CBS, Walt Disney Studios, NBC Universal, and Warner Media.
Grand View Research has segmented the global virtual production market based on component, type, end-user, and region:
Virtual Production Component Outlook (Revenue, USD Million, 2017 - 2030)
Virtual Production Type Outlook (Revenue, USD Million, 2017 - 2030)
Virtual Production End-user Outlook (Revenue, USD Million, 2017 - 2030)
Virtual Production Regional Outlook (Revenue, USD Million, 2017 - 2030)
Middle East and Africa (MEA)
List of Key Players in the Virtual Production Market
Arashi Vision Inc. ( Insta 360)
BORIS FX, INC
Epic Games, Inc.
HTC Corporation (VivePort)
Mo-Sys Engineering Ltd.
Pixar (The Walt Disney Company)
Side Effects Software Inc (SideFX)
Vicon Motion Systems Ltd
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