Location-Based Entertainment Market - Global Forecast 2025-2030

The Location-Based Entertainment Market size was estimated at USD 7.07 billion in 2024 and expected to reach USD 8.64 billion in 2025, at a CAGR 22.53% to reach USD 23.94 billion by 2030.

Location-based entertainment represents a convergence of technology and physical spaces that delivers highly immersive, interactive experiences to audiences of all ages. Whether featuring state-of-the-art augmented and virtual reality installations, multi-sensory motion simulators, projection mapping shows or interactive gaming arenas, these venues transport visitors beyond traditional forms of entertainment. Across amusement parks, arcades, cultural centers and sports venues, operators are reimagining how storytelling, social interaction and gamified elements can be seamlessly woven into physical environments to captivate audiences. Recent productions such as London’s "Elvis Evolution" and franchise-based immersive theatres demonstrate how the melding of AI-generated content, live performance and interactive joins is redefining the concept of live entertainment.

Driven by the desire for shared, memorable experiences in an era of digital saturation, operators and technology providers are investing heavily in hardware advancements and network infrastructure enhancements. The rollout of low-latency 5G Advanced networks, exemplified by T-Mobile’s deployment of the L4S standard, reduces buffering and latency to enable real-time multi-user AR/VR experiences without the need for specialized plans or devices. Moreover, the proliferation of cellular-connected headsets promises unprecedented mobility and richer content delivery for virtual reality venues. As these technological foundations mature, the location-based entertainment industry stands poised for a new wave of transformation.

The latest wave of technological innovation is reshaping location-based entertainment from tethered setups to cloud-powered, edge-rendered experiences. By leveraging NVIDIA’s CloudXR platform in collaboration with AT&T and Ericsson, multi-user, location-based virtual reality environments can now stream photorealistic graphics over 5G, untethering headsets and creating lighter, more comfortable experiences for participants. Similarly, trials of extended reality on commercial 5G Standalone networks by Ericsson, Qualcomm and T-Mobile are validating the potential of slim form-factor AR glasses tethered to smartphones, with network slicing and low-latency optimizations ensuring seamless visuals and interactive environments.

At the same time, consumer expectations are evolving toward deeply personalized, narrative-driven experiences that blend intellectual property franchises with interactive gameplay. Productions such as Netflix’s permanent Houses and large-scale theatrical events like "Abba Voyage" illustrate a growing appetite for immersive storytelling that connects fans to beloved characters and worlds in new ways. Concurrently, the integration of AI-driven content adaptation and 5G-enabled cloud gaming is expanding opportunities for real-time multiplayer interactions and esports-style tournaments within physical venues, redefining social engagement and revenue models for operators.

In December 2024, the United States Trade Representative announced significant tariff increases under Section 301 for imports from China, including a hike to 50% on solar wafers and polysilicon, and a 25% levy on tungsten products and certain semiconductors effective January 1, 2025. Critically, semiconductors used in AR/VR accessories and motion simulation hardware are now subject to these steeper duties, pressuring hardware manufacturers and increasing costs for operators who rely on direct imports.

While certain exclusions were extended to support critical supply chains, the USTR’s decision to allow most product exemptions to lapse by August 31, 2025 reinstates tariffs on dozens of categories. This reinstatement, combined with rising duties, is prompting many technology providers and venue operators to diversify sourcing strategies, accelerate near-shoring efforts and negotiate new supplier agreements. The cumulative effect is an upward pressure on capital and operational expenditures that may be passed on to end consumers if not managed through optimized procurement and strategic partnerships.

The location-based entertainment market can be distilled into a multi-layered framework that spans hardware, services and digital solutions. At the foundation, hardware encompasses everything from AR & VR headset accessories, arcade and gaming machines, spatial audio systems, motion simulator modules, projection screens to environmental sensors. These components enable the visceral, sensory-rich environments that guests expect. Overlaying this layer, service offerings include consulting and integration, customer support and technical assistance, as well as game hosting and maintenance functions that ensure seamless operation and optimal guest satisfaction. At the digital apex, solutions such as analytics platforms, content creation and game development tools, content management and booking CRM systems, simulation frameworks and system integration utilities form the technological backbone that powers insights, personalization and operational efficiency.

Complementing the component hierarchy, the venues themselves range from large-scale amusement parks-encompassing theme and water parks-to intimate arcades, cultural venues like museums and zoos, and specialized sports arenas including indoor halls and stadiums. Technology platforms are segmented into cloud-merged reality, uniting AR and VR in a distributed compute environment, and advanced projection mapping techniques spanning 3D through 5D immersion. Operators adopt business models that vary from pay-per-use offerings for occasional visitors to subscription or membership schemes designed to foster loyalty and recurring revenue. Experience types further diversify into 4D/5D cinematic attractions, narrative-driven immersive storytelling and interactive gaming scenarios that blend real-time user input with environmental feedback. Across applications from educational edutainment and gaming and esports to historical/cultural exhibitions and scientific exploration, operators tailor their offerings to specific audience preferences while maximizing engagement metrics and dwell time.

In the Americas, especially the United States, theme parks and large-format arcades are leveraging network enhancements to deliver more immersive attractions. Providers are integrating low-latency 5G Advanced capabilities to support cloud-streamed VR experiences and real-time multiplayer interactions, while major operators explore flexible pricing models to broaden accessibility. Across Latin America, governments and private investors are collaborating to develop experiential tourism hubs that fuse cultural narratives with interactive technology, demonstrating an uptake in location-based offerings beyond traditional urban centers.

Within Europe, the Middle East and Africa, London has emerged as a global incubator for immersive theatrical experiences, from AI-driven interactive performances to franchise-based permanent venues that extend television and film IP into physical spaces. Simultaneously, cultural institutions across continental Europe and the Gulf region are investing in projection mapping and AR guides to enrich museum tours and live events. In the Asia-Pacific region, China’s theme park expansions, including IP-driven attractions and compact VR-based parks, underscore the region’s leadership in scale and innovation. Operators in Japan, South Korea and India are rapidly rolling out VR arcades and mixed-reality entertainment centers, supported by strong local supply chains and government initiatives aimed at boosting digital tourism and creative industries.

A new generation of technology partners is driving the industry forward through pioneering hardware and software solutions. Dreamscape Immersive, in collaboration with NVIDIA CloudXR, AT&T and Ericsson, has demonstrated how edge-rendered VR can untether headsets and deliver photorealistic multi-user experiences over 5G networks. In parallel, Ericsson, Qualcomm and T-Mobile’s extended reality trials are validating distributed spatial compute and network slicing strategies that will underpin future AR smart glasses and XR installations.

Content and experience studios such as Meow Wolf and Sandbox VR continue to push creative boundaries by blending art installations with interactive gameplay, while established themed entertainment giants are integrating mixed-reality overlays into classic attractions. Hardware providers including HTC VIVE, Pico XR and DPVR are advancing headset ergonomics, haptic feedback and spatial tracking systems. On the solutions side, analytics firms and integration specialists are embedding AI-powered personalization engines and real-time occupancy management tools into platforms, enabling operators to optimize throughput and tailor experiences at scale.

Industry leaders seeking to maintain competitive advantage should prioritize supply chain resilience by diversifying sourcing channels and exploring near-shoring opportunities to mitigate ongoing tariff impacts. By establishing strategic partnerships with local manufacturers and logistics providers, operators can reduce exposure to duty fluctuations and improve procurement timelines. Concurrently, investing in cloud-merged reality platforms and forging alliances with network carriers will ensure readiness for the next generation of 5G and edge-based immersive applications.

To captivate increasingly discerning audiences, organizations must cultivate strong creative partnerships that fuse established intellectual property with bespoke interactive narratives. Implementing advanced analytics and CRM integrations will enable dynamic personalization of content and targeted promotions that drive repeat visits. Embracing hybrid business models-combining pay-per-use offerings with subscription or membership programs-will create flexible revenue streams and deepen customer loyalty. Finally, embedding sustainability and guest safety protocols into venue design and operations will not only address regulatory requirements but also reinforce brand trust in a post-pandemic environment.

This report’s findings are grounded in a rigorous methodology that combines extensive secondary research with targeted primary interviews. Secondary sources include USTR and industry press releases, technology vendor case studies, regulatory filings, and leading business publications. To validate and enrich these insights, the research team conducted in-depth interviews with senior executives, venue operators and technology providers. Insights gleaned from these conversations were triangulated against publicly available data and expert commentary to ensure accuracy and relevance.

The segmentation framework was developed through iterative consultations with subject-matter experts and benchmarked against established industry taxonomies. Qualitative data on emerging use cases and consumer preferences were supplemented by thematic analysis of technology trials and pilot deployments. Finally, all conclusions were peer-reviewed by an advisory panel of industry veterans to ensure that the implications and recommendations align with real-world market conditions and strategic priorities.

The location-based entertainment landscape is at an inflection point defined by the confluence of advanced connectivity, immersive hardware innovations and heightened consumer expectations. While tariff pressures present short-term challenges for hardware procurement and cost management, the agility of operators who embrace diversified sourcing and local partnerships will prove pivotal. The segmentation analysis underscores that tailored offerings across component, venue, technology, business model and application axes will drive differentiation and competitive positioning.

Regional variations highlight that North America’s focus on network-enabled experiences, EMEA’s creative fusion of IP-driven theatre and cultural venues, and APAC’s rapid theme park expansions each offer distinct lessons for global operators. Leading pioneers-from hardware vendors to content studios-illustrate how collaborative ecosystems and technology integration can unlock new revenue streams. By aligning strategic investments with actionable recommendations, industry stakeholders can navigate uncertainty and capitalize on the burgeoning demand for immersive, location-based experiences.

To access the full depth of analysis-including in-depth segmentation by component, venue type, technology, business model, experience and application; a detailed examination of U.S. tariff impacts; comprehensive regional breakdowns; and profiles of leading innovators-reach out directly to Ketan Rohom, Associate Director of Sales & Marketing. He will guide you through tailored purchase options, answer your specific questions and coordinate a custom briefing that empowers your organization to seize opportunities in the immersive location-based entertainment landscape.