In the three short years since Amazon launched Echo speakers, sales have exceeded 42m units, creating a new ‘smart speaker’ category that by September 2018 had clocked up over $6bn in retail sales. Additionally, Echo is now playing a major role in the rising deployment of voice assistants (VAs) in a wider range of devices. Futuresource Consulting’s latest voice assistant report forecasts more than five billion devices will be in use in less than five years, creating a solid platform for voice-enabled content and services.
In the first nine months of 2018 alone, the smart speaker category more than doubled year-on-year to nearly 29m units. The innovative feature-sets built into VAs, coupled with low price points, continue to whet consumer appetites, especially in markets like the UK, US and, increasingly, China. These countries are all avid adopters of the latest gadgets and represent over 90% of smart speaker units sold, despite the fact smart speakers are now available in many more markets
Futuresource’s consumer research shows that privacy is a key inhibitor to uptake, especially in Germany and E Europe, but we expect these concerns to outweighed in the future by the benefits and convenience of VAs. Our 2018 Smart Home Devices & Appliances consumer survey revealed that 38% of non-adopters of smart speakers “can’t see a use for smart home devices”, with a third citing privacy concerns. VA vendors must continue to build compelling use cases and tackle consumers’ fears of devices which eavesdrop upon conversations.
While smart speakers already come in several shapes and configurations (with screens, Zigbee, better audio and cameras) consumers are generally choosing the most basic of feature sets, with Dot and Home Mini on track to comprise almost two-thirds of Amazon’s and Google’s volumes in 2018. Although cost is a factor, this suggests far-field access to the assistant is the primary driver of demand.
Wireless speakers will remain the device that introduces most consumers to VAs but
voice is poised to be the next generation primary consumer interface so it is now being incorporated into many different devices. These are used for a variety of applications from control of home entertainment (eg music and TV) to integration into the smart home’s infrastructure, controlling lighting, security and heating.
The VA battle for the living room is likely to be the most hotly contested area of the smart home. The TV presents a set of unique challenges and significant opportunities. From changing volume, to switching the set on and off, to requesting a movie and search & discovery of content, the benefits of voice could be highly significant to the TV owner. As a result, VAs should mutually benefit Amazon’s, Google’s and Apple’s existing ambitions in OTT media services and TV video connectivity, assets which include Android TV, Fire TV, Prime Video (Amazon), Chromecast, iTunes and Apple TV. Beyond this, TV vendors believe that their devices could become an important hub for controlling the wider smart home.
CES will no doubt see a growing number of soundbars, smart TVs, media streamers, consoles and STBs incorporating far-field microphones to wake up Google Assistant and Alexa. Futuresource estimates that 53m smart speakers sold worldwide in 2018, but a further 65m TV centric devices supporting Alexa, Google Assistant, Siri and Microsoft’s Cortana (Xbox) also shipped. Three million of these supported far-field wake-word microphones. Far field is growing at the expense of push-to-talk buttons on remote controls, as consumers seek the same hands-free access to VAs offered by smart speakers.
Mobile handsets could become the main carrier of VAs, but ultimately the touchscreen will compete with VAs as the primary UI. Moving forward, wireless headphones and wearables have the potential to unleash VA usage in mobiles as wake-word technology and push-to-talk buttons penetrate these categories. Futuresource estimates that 24m headphones shipped with VA support in 2018, rising to 154m by 2022.
AI developments, with natural language processing, machine learning, facial recognition and emotion engines, coupled with improvements in computing and network infrastructure and multi-modal control (gesture and voice), will ensure VAs become more proactive, conversational and human in their interactions. VAs of the future will make recommendations, inform our state of mind and assist with decision making. This dialogue will be based on our habits, likes, aspirations and goals, accumulated from the vast stores of user information and behavioural data that has been gathered about us. VAs are beginning to open up a world of convenience, immediacy and cohesion that we’ve never experienced before.
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