According to a recent report published by Allied Market Research, titled, Global Smart Speaker Market by Intelligent Virtual Assistant, End User, Distribution Channel, and Price: Global Opportunity Analysis and Industry Forecast, 2018-2025, the global smart speaker was valued at $4,358 million in 2017, and is projected to reach $23,317 million by 2025, registering a CAGR of 23.4% from 2018 to 2025.
At present, North America dominates the market, followed by Europe. In 2017, the U.S. was dominant in the North America market, while Germany is expected to lead at a significant growth rate in Europe.
Proliferation of smart home devices is the significant factor, which currently drives the growth of the smart speakers market. Other factors, which influence the market growth are increase in consumer readiness to invest on trending technologies and increase in usage of smart devices among the younger generation. Also, the development of partnerships between smart home manufacturers and creators of smart speakers enables smooth integration of smart home devices with the smart speaker. This proves to be a key factor in the adoption of smart speakers.
However, with the use of smart speaker, privacy of users data becomes a major issue for the consumer demand. Smart speaker provides personalized service to its users by collection and analysis of the users data. The potential of exploitation of users private data by the manufacturers and the threat of illicit cyber-attacks to invade privacy restrict the demand for the smart speakers from the consumers. Also, complexity in training the virtual assistants with various languages spoken around the world limits the global reach of smart speakers.
Moreover, advancement of audio technology due to increased investment in R&D for innovative products by major players is expected to benefit the market. For instance, Alibaba is expected to invest $15bn in R&D of artificial intelligence and security technologies. Further, the upcoming structuring of entirely new wireless infrastructure, 5G, is expected to stimulate the market growth in the future. The ultra-fast 5G wireless network infrastructure is designed to support enhanced digital infrastructure, smart & connected home, and connected devices. This is projected to increase the adoption of smart speakers in the future.
Based on distribution channel, the online segment generated the highest revenue in the smart speaker market in 2017, and is expected to remain dominant during the forecast period. In addition, based on price range, the low price range segment generated the highest revenue followed by medium and premium.
Key Findings of the Smart Speaker Market:
- The online segment is estimated to generate the highest revenue in terms of distribution channel for the global smart speaker market in 2017.
- In 2017, the personal segment is projected to be the highest revenue contributor in the end-user segment.
- Asia-Pacific is anticipated to exhibit the highest CAGR during the forecast period.
- In 2017, North America contributed the highest market revenue, followed by Europe, Asia-Pacific, and LAMEA.
The key players operating in the smart speaker market are Amazon.com, Inc., Apple, Inc., Alibaba Group, Alphabet Inc. (Google Inc.), Sonos, Inc., Bose Corporation, Xiaomi, Samsung Electronics Co. Ltd., Baidu Inc., and Plantronics, Inc. (Altec Lansing/AL Infinity, LLC).