Analyst firm Canalys is projecting that the global smart speaker market will reach 100 million units by the end of 2018. It further estimates that there will be 225 million smart speaker users by 2020.
It’s not entirely clear what the ultimate market potential is. Several hundred million is probably a safe bet on a global basis.
In the near term, Amazon is expected to maintain market-share dominance with 50 percent, while Google will have 30 percent, according to the firm. Apple isn’t expected to break 5 percent. However, that could change if Apple makes several changes and adjustments to its HomePod (e.g., lowering the price, supporting third-party music services).
The category “others” becomes a fairly large segment of the market in the later years of the Canalys forecast. Others would still probably be third-party hardware makers using Alexa, Cortana or Google Assistants in their devices (e.g., Sonos One with Alexa).
The firm asserts that the US will represent about 64 percent of the market by year-end. China is the next largest market, followed by the UK, Germany, Japan and others.
Over the holiday shopping season, there was evidence that Google had gained ground on Amazon. Google is also seen to have a meaningful competitive advantage in international markets because of its channel partners. By 2022, Canalys sees Google catching Alexa penetration.
Earlier survey data indicated that smart speakers are stealing some time and usage from other devices and media. Radio, smartphones and TV are the top three categories, in that order.
Yet people still do relatively few things with smart speakers: news, weather, traffic, music, limited local search and some transactions (e.g., food ordering, shopping mostly with Amazon). Perhaps more importantly, smart speakers are a “gateway” to other smart home device adoption.
As smart speakers become more intelligent and capable, they will likely take on more tasks and functions that people today perform on PCs, tablets and smartphones. Indeed, they have great potential as transactional and communication devices. And despite the coherence and logic of the Canalys forecast, the market remains relatively fluid.
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