Global Shipments of Smart Speakers to Grow by 53% YoY, Reaching 95.25 Million Units in 2019, Says TrendForce

TrendForce has published a new report profiling the latest trends in the global smart speaker market. According to data in the report, the global shipments of smart speakers are expected to reach 62.25 million units in 2018. Driven by the expansion of Google Home into more regions and the growth of smart speaker market in China, the shipments would increase further by 53% YoY, reaching 95.25 million units in 2019. With the strongest growth momentum among all categories of consumer electronics, smart speakers have emerged as a major application of voice interactions and are fast becoming the gateway to other smart-home products as well as the vast ecosystems. Companies including Apple, Facebook, Baidu, and Tencent have all entered the market this year, in addition to first movers.

“Currently, Amazon accounts for around 70% of the US market, therefore Google has to turn to explore the overseas markets”, says TrendForce analyst Tom Tien. With outstanding AI speech recognition, Google is actively developing the voice-user interface for multiple languages, with Google Home supporting 6 languages since 2018, an improvement from 4 languages in 2017. Google Home is now available in 13 countries, up from 6 last year. For 2019, it is expected to be available in more than 18 countries and to support more than 11 languages as well, driving its 2019 global shipment to 30.96 million units, a YoY growth of 72%.

Chinese market anticipates a reshuffle and will experience a period of rapid growth in 2019

As for the Chinese market, China anticipates fast-growth of smart speakers in 2019, but may go through low price competitions before that, says Tien. The aggressive prices offered by major companies may eliminate smaller smart speaker brands out of the market.

In the upcoming online shopping event in China on November 11^th, major smart speaker brands tend to offer more competitive prices to expand their market shares. For example, Alibaba’s smart speaker, Tmall Genie series, and Baidu’s Xiaodu speaker are available at lower prices in this month. Tmall Genie Fang Tang has an original price tag of RMB199, and is available at RMB149 for pre-orders from October 20^th to November 10^th, and down to RMB69 on November 11^th. For Tmall Genie X1, the original price tag and the pre-order prices are RMB499 and RMB239 respectively. The price of Xiaodu speaker will decrease from RMB249 to RMB79.

The aggressive prices offered by these leading companies will make other smaller brands less competitive, and thus withdraw from the market or transfer to niche market due to the cost pressure and loss. We anticipate that the Chinese market will experience a reshuffle and enter a period of rapid growth in 2019, when the customers shrug off their conservative attitudes and become more positive about smart speakers.

TrendForce forecasts that Chinese smart speaker brands would reach shipments of 28.71 million units in 2019, a significant YoY growth of 101.2% from 14.27 million units in 2018.

In terms of market strategies, the major Chinese smart speaker brands not only offer competitive deals but also appeal to customers by showcasing their respective advantages. For instance, Alibaba focuses on AI applications, Xiaomi emphasizes on building its hardware ecosystem; Baidu, on the other hand, is ramping up in both AI and ecosystem investments to catch up with its rivals. For the coming years, the major brands share a common goal to build their AI speech recognition systems and comprehensive ecosystems of hardware, services, and application to lock users in. Therefore, we expect to see a boost in demand for smart speakers in China soon.

As for international brands, smart speakers produced by Amazon, Apple, and Google are all unavailable in China. Due to the lack of access to the Chinese language in their products, it is difficult to expand their services in China.