Industry slowing to 1% growth for next few years
The computer graphics industry has been a growth industry since it was established in the late 1970s. It has weathered the storms of recessions and has emerged renewed vigor and potential, partly due to a big boost from mobile and the move to 4K, but also from emerging technologies including 3D scanning, 3D printing, augmented reality, and VR. However, the growth has leveled off due to the decline in the PC and mobile industries, and slow growth in consoles and software.
The computer graphics hardware market was worth $118 billion in 2015 and is expected to drop to $112 billion by 2019, with software growing slightly better than hardware.
The hardware segment of the CG industry has seen steady growth, with the exception of overall PC sales, which dropped by 10 % over the past year. The largest growth has been in workstations and monitors, with the mobile graphics segment, gaming PCs, and consoles have all declined due to fewer units being sold and dropping ASP as the suppliers try to remain competitive.
2015 saw the induction of new APIs with Khronos' Vulkan, Google's driver extensions for OpenGL ES, Apple's Metal, and Microsoft's DirectX 12 which contributed to faster, richer, and higher resolution graphics for everyone.
In 2015 the CG software market was worth almost $16 billion (not counting services, maintenance and other aspects) and is expected to grow to $17.6 billion by 2019 as the industry shakes off the remaining effects of the recession and starts upgrading software tools. The software suppliers (ISVs) have also changed their sales model moving more services to the cloud, and transitioning to a subscriber system.
We will see the development of traditional segments like CAD/CAM expand as new design approaches in automotive, aerospace, and architecture are adopted. The visualization market is showing significant growth due to the availability of more powerful and less expensive visualization technologies. GPU compute employing OpenCL and CUDA is penetrating further into new as well as traditional applications.
The software content creation market has been tough for the market leaders. They're living with a mature market, with little growth, but stability among the competitors. However, there are new opportunities emerging as new approaches to content creation become practical, new distribution channels open up, and young generations arrive with a new fascination for 3D.
The demand for programmers, artists, scientists, and designers has picked up and we're seeing startups arrive in emerging and reborn markets such as augmented reality, virtual reality, and casual games. The arrival of new APIs, and platforms are also stimulating development. Firms are actively looking for people who can use and exploit these new programs and their associated hardware accelerators.
New opportunities are also growing out of mainstream applications for the web and consumer applications. The social web remains a strong engine for growth. Social networks are encouraging people to learn new tools, create content for pleasure, and even look for jobs in the field. What used to be a very closed society of experts is now opening up due to the democratization of CG, fueled by Moore's law and price-elasticity due to lower software costs.
Given the trends in dropping costs, and the increasing users and usage of CG tools and hardware, we predict that the rate of growth for the CG industry will remain fairly steady for the foreseeable future. Computer graphics is truly a worldwide industry now. JPR will have a press only discussion on this topic at SIGGRAPH in Anaheim at the Hilton on July 27th at noon – all press are invited.
About Jon Peddie Research Dr. Jon Peddie has been active in the graphics and multimedia fields for more than 30 years. Jon Peddie Research is a technically oriented multimedia and graphics research and consulting firm. Based in Tiburon, California, JPR provides consulting, research, and other specialized services to technology companies in a variety of fields including graphics development, multimedia for professional applications and consumer electronics, high-end computing, and Internet-access product development. Jon Peddie's Market Watch is a quarterly report focused on the market activity of PC graphics controllers for notebook and desktop computing.