The music industry is intensely interested in the growth of the market for smart speaker devices: Amazon Echo, Google Home, Apple HomePod and other speakers controlled via voice assistants like Alexa, Google Assistant and Siri respectively.
Research firms are also interested in this market, putting out regular estimates of how well these devices are selling and how the market shares of their manufacturers are changing. We’ve covered an array of studies, and thought it was high time we rounded them up in a primer.
Our first roundup follows, and our plan is to keep updating this article as and when new research (or even just individual data-points from companies in the sector) comes out.
Futuresource estimates that 25m smart speakers shipped in 2017, with the US and UK accounting for 95% of those shipments.
Other companies are more bullish though. Strategy Analytics claimed that these devices “took a giant step towards mainstream acceptance” towards the end of 2017, pushing full-year shipments to 32m units – up 300% compared to 2016.
Strategy Analytics has also published its estimates for shipments in the first quarter of 2018, pegging them at 9.2m units – 278% year-on-year growth. Another research firm, Canalys, was broadly in agreement with the overall figure: it estimated 9m units shipped during Q1 2018.
Canalys claimed that the US accounted for 4.1m of those Q1 shipments – 45.6% overall – ahead of second-placed China (1.8m units) and third-placed South Korea (730k units).
With the US the leading market for smart-speaker shipments, it’s unsurprising that there’s a lot of research focusing on that country specifically.
Tech industry body the Consumer Technology Association (CTA) reckons that nearly 25m smart speakers shipped in the US alone last year, for example. But most of the studies have focused on ownership of these devices: how many people own one, or how many speakers are in people’s homes.
NPR and Edison Research have published regular figures on this. In January 2018, their Smart Audio Report estimated that 16% of American adults owned a smart speaker – around 39 million people. When the report was updated in July 2018, this had increased to 18% of American adults – around 43 million people.
NPR and Edison Research also now divide smart-speaker owners in to two categories: the 26% who’ve owned their device for a year or more (the ‘first adopters’) and the 74% who’ve bought it in the last 12 months (the ‘early mainstream’).
They also focused on multiple-speaker ownership: 28% of the first adopters have two smart speakers in their house, while 27% have three or more. For early mainstream owners, these figures are 30% and 16% respectively.
Another research firm, Consumer Intelligence Research Partners (CIRP) has put out its own ownership studies. It claimed that there were just under 45m smart speakers in American homes at the end of 2017, and then updated that figure to 50m based on a survey conducted in July 2018.
(CIRP is measuring devices – the install base – while NPR/Edison Research are measuring owners – people – so their overall figures aren’t a direct comparison. Indeed, CIRP claimed in its latest study that 34% of Echo owners and 31% of Google Home owners report owning more than one device. Almost 10% of Echo owners actually have three or more.)
Another study, published by Voicebot in March, suggested that 19.7% of American adults had access to a smart speaker in their home – around 47.3 million people.
Suffice to say, it’s still early days for smart speakers, and any future predictions can look out of date within months, as new devices enter the market. For example, any predictions of global sales rely on a huge unknown – how smart speakers will take off in China. So have a pinch of salt handy, but these are some of the more robust predictions we’ve seen.
Starting with 2018. Canalys predicts that 56.3m smart speakers will ship globally in 2018, with the US accounting for 38.4m of them – that’s around 68%. It sees China as the second-biggest market with 4.4m shipments – a 7.8% share of the global total.
Canalys also has some predictions for the install base of smart speakers – not just sales for this year, but overall ownership including purchases before 2018. It thinks that there will be 100m smart speakers in people’s homes by the end of this year, 2.5 times the year-end total for 2017.
It reckons that 64% of those speakers will be in US households, followed by China (10%), the UK (8%), Germany (6%) and South Korea (3%) with other countries accounting for the remaining 10%. And if you want to look even further ahead, Canalys thinks there’ll be 310m smart speakers in use globally by the end of 2022.
IDC has also put out some numbers on predicted smart-speaker sales. It thinks the value of this market will be $11.8bn globally in 2018, rising to $27.8bn by 2022.
Accenture, meanwhile, has some thoughts on the penetration level of smart speakers (or, as it likes to call them, digital voice assistant (DVA) devices. “If stated purchase plans hold, DVA device ownership will reach one third of the online population in China, India, the US, Brazil and Mexico by the end of 2018,” it claimed in January.
For the US specifically, eMarketer predicts that 61.1 million Americans will use a smart speaker this year – up 40% year-on-year. By 2020 it expects there to be 76.5 million smart-speaker users in the US.
Amazon was the first-mover in the smart-speakers market, and its Echo continues to be the top dog in terms of shipments and ownership. Futuresource, for example, suggests that Echos accounted for 80% of shipments globally in 2017.
However, most research companies agree that Google Home is making inroads into Amazon’s market share. Strategy Analytics estimated that Amazon shipped 9.7m units in Q4 2017 compared to Google’s 6.7m units – respective market shares that quarter of 51.8% and 35.7%.
When the company published its estimates for the following quarter, Q1 2018, it claimed that 4m Echos shipped globally versus 2.4m Google Homes – respective market shares of 43.6% and 26.5%.
That reflects increased competition for both from other manufacturers: 0.7m shipments for Alibaba, 0.6m for Apple and 0.2m for Xiaomi for example, for 7.6%, 6% and 2.4% market shares respectively in Q1.
Canalys also had estimates for Q1 2018, and they were significantly different: 3.2m Google Home shipments for a 36.2% market share, and 2.5m Amazon Echos for a mere 27.7% share, with Alibaba’s 1.1m shipments putting it third on 11.8%, ahead of Xiaomi’s 0.6m (7%) in fourth.
There are also some US-specific estimates for the market shares of the overall smart-speaker install-base: speakers in use rather than just new shipments. This metric favours Amazon thanks to its considerable head-start with the Echo.
In March, Voicebot published a study claiming Amazon accounted for 71.9% of current US smart speaker owners, ahead of Google’s 18.4% and other companies’ 9.7%. By August, CIRP was claiming that Amazon had 70% of the US install-base, ahead of Google Home’s 24% and HomePod’s 6%.
There are some future market-share predictions too. Globally, TrendForce expects Amazon to account for 50.8% of global shipments in 2018, ahead of Google’s 21.6% and Apple’s 9.8%, with Alibaba on 6.3% and Xiaomi on 5.1%.
VC firm Loup Ventures is more bullish on Apple: it sees the company taking a 12% share of global shipments in 2018, behind Amazon’s 52% and Google’s 32% – although that means just 4% left over for other manufacturers, including the Chinese companies.
In terms of the global install-base, Canalys predicts that Amazon will take more than 50% in 2018 ahead of 30% for Google Home and 4% for HomePod – 50m, 30m and 4m units in use respectively. By the end of 2022, it expects these shares to be 34%, 34% and 10% respectively.
eMarketer has some US-specific predictions too: it thinks that 40.7 million Americans will use an Amazon Echo at least once a month in 2018 – around two thirds of smart speaker users. It thinks that 18 million Americans will use a Google Home, for a 29.5% share. By 2020, it expects Amazon to have a 60.8% share compared to Google’s 32.9%.
One important point for all of these predictions: Canalys’ press release talks about Amazon Echo, Google Home and Apple HomePod, but its graph focuses on Alexa, Google Assistant and Siri. We’ll soon have to start talking more about the latter: because certainly in the first two of those, they’ll be used in a growing number of smart speakers that aren’t made by Amazon or Google.
This isn’t a new challenge for research firms. Take smartphones, for example. They’re used to providing separate market breakdowns by manufacturer (Samsung vs Apple vs Huawei etc) and by operating system (Android vs iOS vs… well, that’s about it).
Echo vs Google Home vs HomePod is like comparing manufacturers, but Alexa vs Google Assistant vs Siri is like comparing operating systems – and given that Amazon and Google’s strategy is clearly to get their assistants into lots of third-party devices, it’s the second comparison that may become the most important one.
Music is one of the main things people are using their smart speakers for. NPR and Edison Research reported in July that 90% of first adopters and 89% of early mainstream users have asked their speaker to play music in the last week, ahead of asking a general question (83% / 85%); getting the weather forecast (81% / 85% respectively); and setting a timer or alarm (66% / 69%).
What’s more, 63% of first adopters say they are listening to more audio since getting their speaker, and that rises to 70% for early mainstream users.
Voicebot’s study from January 2018 found that 41.9% of smart-speaker owners use them every day to listen to a streaming-music service, while the percentage for those who do it monthly (which includes the daily users) is 76.2%.
In March, meanwhile, Futuresource said that from its survey of American and British smart-speaker owners, 63% use them for music selection and streaming, while 30% say they use their device to find ‘new music’ – and of those people, 78% do it every day. Smart-speaker owners are also four times more likely to have a music subscription than non-owners.
Glad you asked! Here are some links to Music Ally’s more-detailed coverage of smart speakers in the last year:
April 2018: Music Marketing in the Voice Era – session report from our Sandbox Summit conference
March 2018: Everybody’s Talkin’ report (pdf) – published with British industry bodies the BPI and ERA
March 2018: Smart Speakers’ Impact on Music – session report from the BPI/ERA launch event
January 2018: What do Smart Speakers and Voice Assistants REALLY mean for music? – session report from our NY:LON Connect conference
May 2017: Smart Speakers and Music (pdf) – an edition of our monthly report focusing on the market