The XRDC VR/AR Innovation Report by the AR & VR Innovation Conference (XRDC) which surveys AR/VR developers is out. The conference carries out the survey every year. This year, they surveyed more than 900 XR developers, a significant 33% increase over last year’s respondents.

This year’s XRDC VR/AR Report is also completely free to download and includes some practical insights into the XR industry as gleaned from the survey of some 900 industry professionals that are currently involved in developing augmented reality, virtual reality and mixed reality experiences. The report offers a more nuanced and wide-reaching insight into the AR/VR/MR industries. It covers everything from the types of platforms that developers are using to insights into how they are funding their projects.

Games and entertainment are still accounting for the lion’s share of current and potential AR/XR/MR projects around the world with both taking up 59% and 38% of total projects respectively. Educational and training apps come a close third and fourth at 33% and 27% respectively. The scenario was the same in last year’s report and is likely to remain as it is for the foreseeable future.

Focus of XR Work
Focus of XR Work

Oculus Rift Has Surpassed HTC Vive as the Devs Top AR/VR/MR Platform for Current Projects

One of the biggest developments, but perhaps a not-so-unexpected one, is the finding that Oculus Rift is now the most popular target platform for developers in 2019. This year, up to 29% of developers now have apps for Oculus Rift headsets currently under development. Interestingly, but still unsurprising, the Rift platform is followed closely by Oculus Quest. 24% of respondents said they are currently developing apps for the Quest platform. Finally, HTC Vive comes third at 24%.

XR Platforms for Current Projects
XR Platforms for Current Projects

This is a huge deal because for the last three years running (2016-2018), HTC Vive had been the top AR/VR/MR platform for developers.

From the survey, it is clear Oculus Quest is seeing a meteoric rise. Released three months ago in May 2019, it is already the second most preferred platform for AR/VR/MR developers. It is apparent that the XR developer community is seeing massive potential in the standalone virtual reality headsets and they are quite excited about the prospects of developing apps and experiences for the wireless and portable VR headset which uses 6DoF (six degrees of freedom) controllers. Oculus Quest is also relatively affordable at $399, significantly lowering the barrier to entry for users looking for a cheaper model with superb specs.

The survey also asked respondents what platforms their last project was released on and what platforms they will be targeting for their next projects. Here, a similar split of interests still obtains.

XR Platforms for Future Projects
XR Platforms for Future Projects

30% of the respondents released their last projects on Oculus Rift and while 29% did so on HTC Vive. 22% of the respondents stated that their last project landed on an Android phone or tablet through ARCore. 12% still stated that their last project landed on Oculus Quest in spite of the fact that the platform only debuted three months ago!

Looking into the future, 30% of the respondents have stated that their next AR/VR/MR projects will land on Rift while 28% of the respondents will released their projects on Quest with 24% still choosing HTC Vive.

For the first time, XRDC also asked developers if the apps that they were working one were also designed for 2D experiences such as the traditional mobile phone screens, PCs or gaming consoles. Some 52% of the respondents stated that their current projects were exclusively for AR/VR; 16% responded that they were designing for both 2D and AR/VR and 5% stated that they were designing for 2D but which are adapted for AR/VR. 21% of the respondents stated that they are currently not involved in designing for an AR/VR project. This means only 5% of apps currently under development are ports.

XRDC Report: Current XR Projects
XRDC Report: Current XR Projects

Most AR/VR/MR Projects are Still Financed by Company Coffers

So where is the money for XR development coming from? According to the XRDC survey, most of the AR/VR/MR projects are being funded by the company’s own funds. 41% of the respondents had their projects financed by the company’s existing funds. Last year, the proportion of XR projects financed by company’s own funds was 45%.

Source of Funding for XR Projects
Source of Funding for XR Projects

One positive sign this year is that the investments from clients is creeping up and client-commissioned work now accounts for funding of 27% of respondents, indicating a fairly healthy client uptake.

23% of the respondents stated that they are financing their AR/VR/MR work out of pocket. They share of investor funds rose only marginally from 8% last year to 10% this year.

This is a drop from 27% who gave the same response last year. But the survey is pointing towards a positive direction. As the XR markets continue to mature and developers continue mastering their craft, we are going to see the proportion of company-financed projects shrink as clients step up more to foot the cost of professionally-made immersive experiences.

Profitability Expectations

Just like in last year’s survey, XRDC also sought to know the profitability expectations for XR developers during this year’s survey. In 2018, some 14% of the respondents had stated that their work was already profitable. In 2019, that figure dropped to 11%.

Profitability expectations for XR developers
Profitability expectations for XR developers

According to the latest survey, 27% of developers are only expecting their AR/VR/MR work to pay off in the medium term while 23% expect their work to pay off in the longer term. This is in contrast to 38% and 22% respectively for 2018. In 2019, developers seem to have tempered their expectations. This year, 22% of projects do not have to churn out a profit compared to 10% in 2018.

The AR & VR Innovation Conference (XRDC 2019) will take place on October 14th and 15th. The venue will be Fort Mason Festival Pavilion in San Francisco. Registration is already open so be sure to check out on the passes and prices for the XRDC early on to get the best deal.

XRDC is brought to you by the organizers of the Game Developers Conference. You can download the XRDC AR/VR Innovation Report 2019 freely from the website.

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