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Wi-Fi Speakers: Voice, Tech Giants Disrupt, Boost Market

Sales of Wi-Fi speakers are soaring, driven largely by demand for smart voice-assistant speakers from Amazon and Google. But sales of Wi-Fi speakers that aren’t so smart also rose in 2016 and will do so in 2017, research and consulting company Futuresource told CES Show Daily.

In the U.S., shipments of Wi-Fi speakers and hybrid Wi-Fi/Bluetooth speakers rose 117 percent to 8.4 million units in 2016, up from 40 percent growth in 2015, on retail-level dollar growth of 87 percent in 2016 to $1.52 billion and 11 percent in 2015.

The statistics include Wi-Fi-only multiroom speakers, hybrid Wi-Fi/Bluetooth multiroom speakers, Google’s multiroom Google speaker, and Wi-Fi speakers that lack multiroom capability, as Amazon’s Echo, Tap and Dot smart speakers.

For its part, the multiroom segment of the Wi-Fi speaker market will get a major boost in 2017 from speakers equipped with Google’s multiroom Google Cast technology, Futuresource said. Those speakers can be controlled from the Google Home speaker launched in late 2016 with Google Cast. In addition, plans by Sonos and Bose to integrate with Amazon’s smart speakers “will also drive up volumes of multiroom-audio speakers,” said Futuresource analyst Rasika D’Souza.

Despite growth, not all will be rosy for traditional CE suppliers in the Wi-Fi-speaker market unless they adapt to the disruptions brought on by Cloud-based voice-assistant technologies, the tech giants behind voice, and Google’s Google Cast, analysts said.

Louder Voice

By the end of 2016, voice-assistant speakers will account for 51 percent of Wi-Fi speaker shipments globally, including voice speakers from traditional CE suppliers, Futuresource said.

Voice speakers from CE suppliers will come in two forms. Some suppliers will embed a microphone and voice assistant, whether Amazon’s Alexa service or Google’s service, into their speakers, enabling the speakers to access Amazon’s and Google’s Cloud- based voice services, including voice control of smart-home systems. Alternately, some CE suppliers will network their speakers with an Amazon or Google smart speaker, enabling consumers to talk to their smart speaker to control select features of CE-brand WI-Fi speakers. Consumers would also be able to stream their smart speaker’s music services through their CE-brand speakers.

“Voice speakers will bring in the much needed growth in the overall Wi-Fi [and hybrid Wi-Fi/Bluetooth speaker] space,” said Futuresource’s D’Souza. “Amazon has given a huge boost to the market,” she said. Amazon’s Echo, Tap and Dot accounted for about 1.2 million units shipped in 2015 out of a total of 1.61 million hybrid Wi-Fi/Bluetooth speakers shipped in the U.S., D’Souza said.

Wireless multiroom speakers will also continue to grow, jumping 21 percent in unit shipments in 2015 8 percent in and 2016 to 2.1 million, Futuresource statistics show. Retail-level dollars, however, fell 5 percent in 2015 to $543 million because a greater variety of lower cost models were launched, D’Souza said. Wireless-multiroom speaker dollars were flat to slightly up in 2016.

Futuresource expects the multiroom segment to grow in 2017 by 35 percent in units, fueled in part by Google’s multiroom Google Home speaker and the integration of CE-brand multiroom speakers with Amazon’s Cloud-based Alexa Voice Service.

“Voice recognition technology is the next big thing, and it’s going to be huge,” said Futuresource’s D’Souza. “Speakers have the ideal feature set for incorporating voice, and right now this is a colossal opportunity for audio companies, if they get it right.”

“It feels like the industry has found its window of opportunity as speakers become even smarter and are capable of communicating with other smart home applications, placing audio at the beating heart of the smart home revolution,” she said. But audio suppliers face a major challenge.

“The audio-brand landscape could so easily be destabilized as Amazon, Google and other technology giants look to seize market share,” she explained.

Voice Partnerships

Potentially, voice technology will also have a positive impact on the multiroomaudio segment of the Wi-Fi-speaker market, D’Souza added. Sonos, Denon and Bose have already partnered with Amazon for voice control, as has DTS through its Play-Fi multiroom platform. The partnerships will enable users to talk to an Amazon smart speaker to control select functions of the audio companies’ multiroom speakers. The partnerships will also enable the audio brands’ speakers to stream the Amazon speakers’ music services and other Amazon cloud-based audio services.

Play-Fi speakers that integrate with the Amazon speakers are targeted for first-quarter availability, DTS told the Show Daily. “Many of the DTS Play- Fi devices will be getting a firmware update to add that capability,” a spokesman explained.

Play-Fi will go a step farther with the targeted second-quarter launch of the first Play-Fi speakers with a built-in far-field microphone and direct access to Amazon’s Alexa Voice Service. Two Wi-Fi speakers already feature built-in Alexa and microphone. They are the $199 Triby from Invoxia and the $69 Jam Voice from Jam Audio.

Google Cast Vocals

“Soon,” all Google Cast-enabled speakers will be voice-controlled via the Google Home smart speaker, Futuresource’s D’Souza added. “This is definitely expected to drive some growth in the overall multiroom segment.”

Although Google Cast’s ability to cast audio content from more than 200 Cast-enabled apps “has the potential to drive growth in multiroom audio,” she noted, unless big brands such as Bose team with Google, “it will be a challenge for Google Cast to lead the multiroom segment.”

For his part, IHS Markit senior analyst Paul Erickson sees Google Cast as a potential boon to wireless multiroom audio. In wireless multiroom, “the overall proposition in terms of awareness and pricing has generally remained out of the mainstream, though this has begun to slowly change [because] of competition,” he said. However, “the main change agent likely to give it real progress in the mainstream is Google Cast,” thanks to the success of Google’s $35 Chromecast Audio dongle. The dongle incorporates Google Cast and connects via optical and analog outputs to home-audio systems and powered speakers. “The Cast ecosystem has grown out of the success of the original Chromecast and brings the same low-cost enablement appeal to multiroom audio,” Erickson explained.

Besides low cost, Google Cast’s existing installed base in Chromecast dongles, Google Cast’s growing installed base in smart TVs, and Cast integration with Chrome web browsers “give the standard practical appeal and potential use cases tangible scale beyond the typical tablet/smartphone-controlled music-playback scenarios.”

“Google Cast is the multi-room audio standard most likely to be supported across more brands, form factors, and devices —such as receivers, not just speakers—than any other over time,” Erickson contended. “While individual [wireless-multiroomaudio] brands may keep their own standards alive for both differentiation as well as legacy support, many will also support Google Cast in parallel in order to ensure the total available market for their product is maximized,” he said.

About 15 CE companies incorporate or plan to incorporate Google Cast, also called Chromecast Built In, into speakers and other audio products.

At least three companies — Vizio, JBL and Atlantic Technology – are or plan to offer speakers only with Google Cast and no other wireless multiroom technology or embedded streaming services.