3D Animation Market is forecast to reach $23.48 billion by 2025, at a CAGR of 11.28% during the forecast period from 2020-2025. Growing adoption of VFX in movies and increasing adoption of smart devices considerably for advance 3D supporting mobile games and application offering superior user experience to commercial users spurs the demand for the market. 3D animation offers real-time behavior and enables viewers to feel the experience and visual effects when they are playing mobile games and applications. It supports full movie video technique which helps to display action in and helps in exploration of virtual worlds by more realistic graphics and representation in mobile games and movies. Several companies are adopting these technologies to improve the user experience. For instance studios such as Walt Disney, Pixar have adopting 3D Animation software and technologies such as 3D modelling, 3D rendering software, 3D architectural visualiation and special effects to create movies. Similarly, Gaming platforms such as Sony PlayStation, Microsoft Xbox, and Nintendo leverage the 3D animation and motion capture animation technology for producing gaming environments which digitally creates the photo-realistic animation of the users’ movements. These technologies will accelerate the demand for 3D animation market. The report covers 3D Animation Market size by technology and Verticle, 3D Animation Market share by top 5 companies and also the market share by start-ups during the forecast period.
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Technology – Segment Analysis
Visual effects segment is anticipated to grow at the highest CAGR of 12.9% in the forecast period owing to emerging trend of subcontracting the development of visual effects and computer-generated imagery (CGI) techniques to emerging economies bodies well for the regional markets in developing nations. However, governments of developed nations, such as Canada and U.K., are trying to counter the trend by providing grants, subsidies, and tax rebates and encouraging the development of visual effects within the country. For instance, the Canadian government has awarded $489.26 thousand in repayable contributions to L’Atelier Animation, Luckyhammers Entertainment and Tonic DNA to support the rapidly growing animation and media industries in Montreal. These kind of contribution and support will enhance the growth of visual effects segment there by creating opportunities for 3D animation market.
Deployment – Segment Analysis
On-demand segment is expected to witness a highest CAGR of 11.7% in the forecast period as the adoption of On-demand deployment helps reduce infrastructure costs and saves time. It envisages hosting the animation software on the vendor’s server and accessing it via the web browsers. According to a recent study by International Data Corporation, by 2019, the yearly expenditure on public cloud services is expected to grow by 19.4% to reach $141bn, so increasing preferences towards cloud services is also enhancing the demand for on-demand deployment there by creating opportunities for 3D animation market.
Geography – Segment Analysis
In 2018, North America dominated the 3D animation market share by 43.5% and anticipated to retain its leading position over the forecast period. The economy of North America is majorly influenced by the countries such as the U.S. and Canada. In these countries, presence of major players in 3D technology such as Adobe, Autodesk Inc., and growing demand for 3D animation in movies in U.S. and Canada is expected to drive the 3D animation market in this region. For instance movies like toy story 3 has spent $200M for 3D animation and VFX. Similarly, Hollywood spend 60% of the budget on VFX. On the other hand, online gaming has been rather influential in driving the market in this region wherein 3D animation and VFX play a crucial role in game designing. Over the years, online gaming has become graphically more intricate and impressive, thanks to the superior quality of animation and gameplay variety. Realizing the growing scope of gaming in the entertainment industry, in November 2018, Walt Disney entered into a game development partnership with Jam City to develop new games based on various elements from Disney’s Walt Disney Animation Studio and Pixar brands. 3D animation is widely used in game development which is expected to find enormous demand during the forecast period.
Drivers –3D Animation Market
The entertainment and media industry has been raising high demand for 3D animation with increased adoption in the recent years. Besides improved adoption of 3D animation and visual effects, the industry has been pushing the global market based on other important factors. The world 3D animation market could be boosted by the advent of AI, VR and AR. Artificial Intelligence (AI) and natural language processing with cognitive modeling approach is used by 3D animators to augment and virtualize the animation process for controlling the simulation and user experience in the 3D games. On the other hand, rising interest in watching animated movies in virtual reality is predicted to set the tone for valuable growth of the market.
The growing adoption of visual effects in movies is one of the major driver for 3D animation market. VFX in movies are growing rapidly, for instance in 70% of the Hollywood movie budget is been allocated to visual effects and rising interest towards VFX in game development is also major factor which creating opportunities for market growth. For instance Walt Disney has partnered with gaming company to develop games with high visual effects. These kind of developments will accelerate the growth of market.
Challenges – 3D Animation Market
The animation industry continues to be exposed to corruption and piracy risks. The software installation of companies is targeted and pirated copies are sold in the market. Consequently, the industry suffers huge financial losses. On the other hand high price sensitivity to adopt this technology is the major which hamper the market. For instance the cost required to adopt this technology for one minute video costs around $7000 to $8000. Similarly, cost required to adopt 3D technology to develop a game is very high. These conditions will restrain the 3D animation market size in forecast period.
Partnership, acquisitions and technology launches are key strategies adopted by players in the 3D animation software Market. In 2018, the market of 3d animation industry outlook has been consolidated by the top five players accounting for 55% of the market share. 3D animation top 10 companies include Adobe Systems Inc. Autodesk Inc., Autodessys, Corel Corporation, Maxon Computer, Newtek Inc., Nvidia Corporation, Pixologic Inc., Sidefx Software, and The Foundry Visionmongers Ltd among others.
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