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Market Context
Recent focus by industry leaders such as Meta on the metaverse has renewed interest in the AR (augmented reality) and VR (virtual reality) market. Apple's launch of the Vision Pro has ushered in a new era of spatial computing. Some view AR/VR as the next-generation 3D digital interaction platform. So far market reality has not matched high expectations. An IDC press release in September noted that global AR/VR headset shipments declined for the fourth consecutive quarter, with second-quarter 2023 shipments down 44.6% year on year. Several challenges must be addressed to drive demand and increase adoption. Innovations in display technology are critical to developing AR/VR products and growing the market.
Growth Forecasts for AR/VR
According to Guillaume Chansin, DSCC display research director, speaking at the DSCC AR/VR display forum in September, the AR/VR headset market is expected to see stronger growth over the next five years starting in 2024. The assumption is that new headsets adopting the Qualcomm Snapdragon XR2 Gen 2 will drive notable adoption in 2024. IDC also predicts a rebound in AR/VR headset shipments in 2024, driven by new hardware from Meta and ByteDance, Apple's Vision Pro, and a growing number of smaller companies. DSCC expects Vision Pro sales to be relatively low (around 300,000 units), priced at $3,499, and notes that users requiring prescription optical lenses (designed by Zeiss) will incur additional cost. Meta is expected to launch Quest 3 by the end of the year, and Samsung may re-enter the market after a long absence.
With a trend toward multi-screen products, AR/VR display shipments will exceed headset shipments because most devices use two displays (one per eye). DSCC forecasts AR/VR display shipments will reach 124 million units by 2028. As Guillaume noted at the forum, AR/VR is not expected to replace smartphones but to serve as a second screen, similar to how tablet computers are used today. DSCC expects VR (including passthrough AR) to dominate the consumer segment, while see-through AR will be oriented mainly to professional applications.
Resolution and Display Technology Trends
In AR/VR, system resolution is often measured in pixels per degree (PPD). Insufficient PPD leads to the screen-door effect. To address this, many companies are deploying high-resolution microdisplays. VR systems have begun using micro OLED to reduce form factor and mitigate the screen-door effect. DSCC predicts that, over the next few years, silicon-based OLED will hold the largest share of VR display shipments, with LCD in second place. AMOLED is expected to lose share due to pixel density limits. MicroLED, with its higher brightness potential, is advantageous for see-through AR, while brightness is less critical for VR.
MicroOLED: Suited for VR and See-Through AR
MicroOLED microdisplays are being adopted for VR and mixed-reality displays, notably in Apple Vision Pro. They are applicable to both VR and see-through AR, helping reduce device size and the screen-door effect. MicroOLEDs are typically classified as RGB OLED and white OLED (WOLED). High-resolution RGB OLED microdisplays still face shadowing challenges during fine metal mask (FMM) deposition. WOLEDs use color filters to create images and can achieve very high PPI (around 4000 PPI), but color filters absorb a large fraction of emitted light, limiting maximum brightness. Sony has used microlenses to improve peak brightness in OLED microdisplays. Kopin developed a triple-stack architecture to boost brightness. eMagin reported achieving 10,000 nits in a WUXGA 4K OLED microdisplay by directly patterning red, green, and blue emitters on the backplane and eliminating the color filter. Samsung Display has acquired eMagin.
MicroLED: Emerging for See-Through AR
MicroLED offers very high brightness, high reliability as an inorganic LED display, and the potential to build ultra-compact, low-power form factors, providing significant advantages for see-through AR. Achieving high-efficiency MicroLEDs with submicron chip sizes on a single substrate is a major technical goal. However, MicroLED efficiency tends to decline as chip size shrinks. Samsung Display's research, noted in a technical article, indicates that appropriate sidewall passivation structures and methods can mitigate size-related external quantum efficiency (EQE) loss. Multiple research groups and companies are developing cross-section RGB and vertically stacked RGB approaches to realize RGB on a single wafer, but these techniques are not yet mature for high-volume production. The first commercial steps are expected to combine three RGB panels optically, with single-wafer RGB panels targeted later. Companies such as Jade Bird Display (JBD), Porotech, and PlayNitride have recently shown full-color MicroLED demonstrations.
Mojo CEO Nikhil Balaram told the DSCC forum that achieving efficient submicron RGB MicroLEDs on a single substrate requires a mature ecosystem and cost-effective scalable processes. Mojo developed a color display using high-performance quantum dots (HPQD), efficient submicron blue and green MicroLEDs, and efficient red and green QD inks, leveraging a 300 mm silicon-based GaN manufacturing process.
Nanosys senior scientist Ilan Jen-La Plante said at the forum that the QDC process simplifies MicroLED manufacturing and improves yield for standard mass transfer of R/G/B LED chips because only blue chips are required. Using only blue chips also simplifies driver electronics. Red QD-converted MicroLEDs can be more efficient than native red MicroLEDs, especially at small pixel sizes.
In October, JBD announced that its 0.13-inch red MicroLED chip exceeded 1,000,000 nits of brightness. JBD's red MicroLED has a pixel pitch of 4 μm and emitter sizes under 2 μm, which poses severe efficiency challenges. With new materials, improved passivation, and final design refinements, JBD says it overcame size-effect barriers and significantly improved internal quantum efficiency. The red brightness milestone enables JBD's Hummingbird X-cube multicolor projector. JBD plans to release a mass-produced Hummingbird optical engine targeting consumer AR glasses. MicroLED is progressing toward commercialization:
Applied Materials: UV-A microLED and Cd-free RGB quantum dots, high EQE and efficiency, simplified mass transfer, pixel repair schemes for a fourth subpixel, aimed at improving yield and lowering production cost.
PlayNitride: For AR/MR, mu-PixeLED single-device 0.49-inch FHD full-color MicroLED microdisplay, extremely high 4,536 ppi, >150,000 nits.
Porotech: 0.26-inch, 1280×720 MicroLED microdisplay single panel for full-color AR.
JBD: 0.13-inch monolithic MicroLED microdisplay for AR and VGA with color projector (in production).
NS Nanotech: NanoLED microdisplays for AR/VR, submicron, efficient, multicolor light sources monolithically integrated on a single chip.
LCD: MiniLED's Strong Showing in VR Displays
LCD has led the VR market through advances that enable high PPI. Manufacturers are using advanced LTPO (LTPS plus oxide backplanes) to produce displays with the higher aperture ratios critical for VR. Local dimming techniques provide higher contrast and lower power consumption. Integration of MiniLED backlights helps LCDs improve response time, contrast, brightness, and lifetime. LCD also remains more cost-competitive.
Outlook
Each display technology offers distinct advantages and faces specific challenges for the AR/VR market. Continued innovation in display technologies, particularly MicroOLED and MicroLED, will be central to expanding AR/VR product capabilities and supporting market growth.
