Virtual Production in Japan Trends and Forecast
The future of the virtual production market in Japan looks promising with opportunities in the movies, TV series, commercial Ad, and online video markets. The global virtual production market is expected to reach an estimated $7.7 billion by 2031 with a CAGR of 15.1% from 2025 to 2031. The virtual production market in Japan is also forecasted to witness strong growth over the forecast period. The major drivers for this market are the significantly growing demand for visual effects in the movie and television industries, the increasing implementation of virtual production with LED wall technology, and the rising demand for digital video streaming platforms like Netflix and Amazon Prime across the globe.
• Lucintel forecasts that, within the type category, post-production will remain the largest segment over the forecast period.
• Within the end use category, movies will remain the largest segment.
Emerging Trends in the Virtual Production Market in Japan
Japan is at the forefront of the virtual production revolution, leveraging advanced technologies to transform content creation across entertainment, advertising, and education. The country is known for its strong technology base and creative industries, which are adopting innovations like real-time rendering and motion capture to streamline workflows and enhance storytelling. These trends are driven by increasing consumer demand for immersive content and the integration of virtual production into various sectors. Below are five key trends shaping the virtual production market in Japan.
• Real-time rendering adoption: Japanese studios are increasingly using real-time rendering to improve visual quality and production speed. This technology is allowing creators to visualize scenes instantly, making production processes more efficient.
• Growth of motion capture technology: Motion capture is widely used in Japan to create realistic character animations for gaming, films, and interactive media. Its adoption is driving innovation in character design and performance realism.
• Integration of extended reality (XR): Extended reality, combining virtual and augmented reality, is gaining momentum in Japan. It is enabling immersive storytelling and interactive experiences across various content formats.
• AI-driven virtual production tools: Artificial intelligence is transforming production workflows in Japan by automating tasks, optimizing virtual environments, and enhancing creative decision-making processes.
• Collaborative ecosystems: Japan is fostering partnerships between technology providers, content creators, and academic institutions to advance virtual production capabilities and address industry challenges.
These trends are positioning Japan as a global leader in virtual production, driving innovation and setting new standards for creative content creation.
Recent Developments in the Virtual Production Market in Japan
The virtual production market in Japan is evolving rapidly, supported by technological advancements, strategic investments, and cross-industry collaborations. Japanese studios and content creators are embracing virtual production to enhance creativity and efficiency in their workflows. Below are five significant developments shaping the market.
• Establishment of high-tech production studios: Japan is investing in state-of-the-art facilities equipped with LED walls and motion capture systems. These studios are attracting international projects and enhancing domestic production quality.
• Partnerships with global leaders: Collaborations with technology giants such as Unreal Engine and Sony are providing Japanese creators with access to cutting-edge virtual production tools and expertise.
• Use in large-scale events: Virtual production is being adopted for large-scale live events and concerts in Japan, offering engaging and immersive experiences while optimizing production costs.
• Increased government support: The Japanese government is supporting digital transformation through grants and incentives, encouraging the adoption of virtual production technologies across multiple sectors.
• Education and training programs: Japanese universities and training centers are introducing courses on virtual production, ensuring a steady supply of skilled professionals for the growing market.
These developments are accelerating the growth of the virtual production market in Japan, enhancing the country’s global competitiveness in creative content creation.
Strategic Growth Opportunities for Virtual Production Market in Japan
Japan’s virtual production market offers diverse growth opportunities across multiple applications. From filmmaking to healthcare and education, virtual production is driving innovation and efficiency. Below are five key growth opportunities shaping the market.
• Film and television production: Virtual production is transforming filmmaking in Japan by enabling the creation of visually stunning content while reducing costs and production timelines.
• Gaming and interactive media: The gaming industry in Japan is leveraging virtual production to design immersive game environments and enhance player experiences, boosting global competitiveness.
• Advertising and marketing: Brands in Japan are adopting virtual production to create dynamic and cost-effective advertisements, improving campaign impact and audience engagement.
• Healthcare simulations: Virtual production is being used in Japan to develop realistic simulations for medical training and patient education, enhancing healthcare outcomes.
• Education and training: Japanese educational institutions are using virtual production to create interactive learning experiences, particularly in technical and creative fields.
These strategic growth opportunities highlight the versatility of virtual production, driving market expansion and innovation in Japan.
Virtual Production Market in Japan Driver and Challenges
The virtual production market in Japan is influenced by a combination of technological, economic, and regulatory factors. While innovations and government support are driving growth, challenges such as high costs and skill shortages remain significant barriers. Below are the key drivers and challenges shaping the market.
The factors responsible for driving the virtual production market in Japan include:
• Technological innovation: Advancements in real-time rendering, motion capture, and AI are enhancing production quality and efficiency in Japan.
• Demand for immersive content: The rising popularity of interactive media and immersive experiences is fueling the adoption of virtual production technologies.
• Government support: Financial incentives and grants from the Japanese government are encouraging innovation and digital transformation in the creative sector.
• Cross-industry applications: Virtual production is being applied across various sectors, including entertainment, healthcare, and education, driving market growth.
• Sustainability focus: By reducing reliance on physical sets and travel, virtual production is aligning with Japan’s environmental goals and cost-saving measures.
Challenges in the virtual production market in Japan are:
• High implementation costs: The significant investment required for virtual production technologies limits adoption, particularly among smaller studios.
• Skill shortages: A lack of trained professionals in virtual production technologies is slowing market growth, emphasizing the need for targeted education and training.
• Infrastructure limitations: Access to advanced production facilities is uneven across Japan, hindering market expansion in certain regions.
While drivers are fueling growth in Japan’s virtual production market, addressing challenges such as costs and skills gaps will be crucial for sustained development and innovation.
List of Virtual Production Market in Japan Companies
Companies in the market compete on the basis of product quality offered. Major players in this market focus on expanding their manufacturing facilities, R&D investments, infrastructural development, and leverage integration opportunities across the value chain. Through these strategies, virtual production companies cater to increasing demand, ensure competitive effectiveness, develop innovative products & technologies, reduce production costs, and expand their customer base. Some of the virtual production companies profiled in this report include:
• Company 1
• Company 2
• Company 3
• Company 4
• Company 5
• Company 6
• Company 7
• Company 8
• Company 9
• Company 10
Virtual Production Market in Japan by Segment
The study includes a forecast for the virtual production market in Japan by type, component, and end use.
Virtual Production Market in Japan by Type [Analysis by Value from 2019 to 2031]:
• Pre-production
• Production
• Post-production
Virtual Production Market in Japan by Component [Analysis by Value from 2019 to 2031]:
• Hardware
• Software
• Services
Virtual Production Market in Japan by End Use [Analysis by Value from 2019 to 2031]:
• Movies
• TV Series
• Commercial Ads
• Online Videos
• Others
Features of the Virtual Production Market in Japan
Market Size Estimates: Virtual production in Japan market size estimation in terms of value ($B).
Trend and Forecast Analysis: Market trends and forecasts by various segments.
Segmentation Analysis: Virtual production in Japan market size by type, component, and end use in terms of value ($B).
Growth Opportunities: Analysis of growth opportunities in different type, component, and end use for the virtual production in Japan.
Strategic Analysis: This includes M&A, new product development, and competitive landscape of the virtual production in Japan.
Análisis de la intensidad competitiva de la industria basada en el modelo de cinco fuerzas de Porter.
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Preguntas frecuentes
Q.1 What are the major drivers influencing the growth of the virtual production market in Japan?
Answer: The major drivers for this market are significantly growing demand for visual effects in movie and television industries, increasing implementation in virtual production of LED wall technology, and rising demand for digital video streaming like Netflix and Amazon Prime across the globe.
Q2. What are the major segments for the virtual production market in Japan?
Answer: The future of the virtual production market in Japan looks promising with opportunities in the movies, TV series, commercial Ad, and online video markets.
Q3. Which virtual production market segment in Japan will be the largest in future?
Answer: Lucintel forecasts that post-production will remain the largest segment over the forecast period.
Q4. Do we receive customization in this report?
Answer: Yes, Lucintel provides 10% customization without any additional cost.
This report answers following 10 key questions:
Q.1. What are some of the most promising, high-growth opportunities for the virtual production market in Japan by type (pre-production, production, and post-production), component (hardware, software, and services), and end use (movies, TV series, commercial Ads, online videos, and others)?
Q.2. Which segments will grow at a faster pace and why?
Q.3. What are the key factors affecting market dynamics? What are the key challenges and business risks in this market?
Q.4. What are the business risks and competitive threats in this market?
Q.5. What are the emerging trends in this market and the reasons behind them?
Q.6. What are some of the changing demands of customers in the market?
Q.7. What are the new developments in the market? Which companies are leading these developments?
Q.8. Who are the major players in this market? What strategic initiatives are key players pursuing for business growth?
Q.9. What are some of the competing products in this market and how big of a threat do they pose for loss of market share by material or product substitution?
Q.10. What M&A activity has occurred in the last 5 years and what has its impact been on the industry?
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