Firms like Alibaba Group Holding Ltd. have been funding a $1.1 billion investment fund that is meant to position Chinese companies as essential middlemen in a rapdily expanding virtual reality technology market.
Chinese President Xi Jinping has announced his intentions to have the country move away from ”heavy industry” and focus on technology that can benefit society.
The campaign to support entrepreneurship in China began in 2014 and since then 1,600 high-tech incubators for startups have been created in the country. 200 startups being supported by those incubators are focused on developing virtual reality to become a consumer, as well as a corporate, tool.
The market capitalization towards China’s virtual reality development has been estimated to be greater than the state of Israel’s gross domestic product, according to an article on Bloomberg News. 40 percent of all virtual reality headsets curently being sold will be shipped to China. That is estimated to be around 2.52 million headsets.
Several Beijing based companies are focused on the entertainment aspect of the virtual reality headsets, while larger companies such as Alibaba are focusing on the consumer aspect that virtual reality headsets can provide to the online shopping market.
A digital shopping experience through 3-D renderings of hundreds of products would revolutionize the entire industry and its 400 million users worldwide.
Technology analysts have determined that once the virtual reality aspect matures, it could become significant in about 40 percent of all entertainment content. Chinese companies like GnomeMagic Lab are integrating virtual reality with real life movies, like the Mission Impossible series, to give viewers a new vantage point for the movie experience.
The United States’ market in virtual reality is expected to grow by 37 percent and U.S. firms plan to have a strong presence in the industry as well.
And companies in the United States plan to remain competitive with the Chinese startups that are prospering in mainland China.