The expectations around disruptive technologies like virtual reality (VR), augmented reality (AR), artificial intelligence (AI), and wearable devices headed into 2016 were high — too high, it turned out. But there are important breakthroughs on the horizon in 2017. AR and VR will see wider adoption. AI technology will improve and continue to dominate human-computer conversations. And traditional apps will face more fervent competition from chatbots, app streaming, and mini apps. Below are our top predictions for the apps and platforms market in 2017. These predictions are based on our ongoing tracking, analysis, and forecasting of the apps and platforms market, and conversations with industry executives.

The first-year sales of first generation VR headsets will outsell the first-year sales of major game consoles.

Today's major gaming consoles, such as PlayStation and Xbox, saw their inaugural years in the early 2000s. Now, the latest mass-market consumer devices — VR headsets — are making their debut. The Oculus Rift, HTC Vive, PlayStation VR, and even smartphone-powered headsets like the Google Daydream, are in their first year of sales.

While they won’t see massive growth overnight, we expect first-year sales of VR headsets to outsell first-year sales of major gaming consoles. For context, gaming consoles today have about a 40% penetration rate in the US.

Consumer-oriented voice products will reach parity with text input.  

Digital voice assistants, like Siri, Cortana, and Google Now, are far from perfect. However, they tend to see yearly incremental improvements that enhance their conversational abilities and make them more functional. And as internet-connected home assistants like Amazon’s Echo and the Google Home become more popular, issuing voice commands will become a normalized aspect of consumer behavior.

Anyone who’s had a conversation with or issued a command to one of the major smartphone-oriented digital voice assistants like Siri knows what a clunky and imperfect experience it can be. But we expect the technology powering these assistants to evolve and improve.

  • One issue, input, is already being solved. For the first time, in 2016, voice-recognition software trumped humans at typing input in terms of speed and accuracy, according to a study from Stanford University, the University of Washington, and Baidu. And these assistants' ability to recognize voice proved better than humans' by a wide [...]