Australia’s consumer demand for VR (virtual reality) headsets outweighs the current supply, with the strongest pent-up demand coming from gamers, according to analyst firm Telsyte.

The firm predicts that 110,000 VR headset units will be sold in the country this year, with sales rapidly growing to more than 500,000 units per year by 2020. “Strong market growth will come in 2017 and 2018 as manufacturers ramp up production and more ‘must have’ use cases emerge,” said Telsyte MD Foad Fadaghi.

Based on ongoing research conducted for the computer games industry, Telsyte predicts the bulk of the initial VR device demand will be driven by video gamers. Today one in two households have a game console – of which around a third have a current generation model.

Fadaghi said it is clearly gamers who see VR as the next frontier in immersive entertainment.

Telsyte segments VR headsets into four categories: computer, mobile, console and standalone. It forecasts the largest share by value in the Australian market will be VR for consoles for at least the next two years.

Beyond 2017 the availability of lower-priced products and more advanced mobile and PC-based options will help lift the share of non-console based VR, it said.

“As with smartphone penetration, it could take up to a decade for VR to reach mainstream levels, but there is clearly pent-up demand from early adopters,” Fadaghi says.