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No Blues For Bluetooth Speaker Market

NEW YORK – No one is crying the blues over Bluetooth- speaker sales.

Triple-digit percentage growth in unit and dollar volume is driving suppliers to launch their first dedicated Bluetooth speakers or expand their selection to offset declining sales of docking tabletop speakers, which use pin connectors to dock with Apple’s mobile iOS devices. Some companies are also adding Bluetooth to docking speakers to extend compatibility to Android-based smartphones.

In the first quarter, retail-level sales of portable AC/ DC and AC-only Bluetooth speakers surged 432 percent in units to 744,000 and by 242 percent in dollars to $80.6 million, according to The NPD Group’s Retail Tracking Service. That follows full-year 2012 unit growth of 496 percent to 2.2 million units and full-year dollar growth of 337 percent to $264.2 million.

In contrast, 2012’s retail-level docking-speaker sales fell 16 percent in dollars to $505 million and 18 percent in units to 63 million, including tabletop speakers that combine docking pins with wireless Bluetooth or Wi-Fi.

Suppliers attribute sales gains in Bluetooth-only speakers to the rise of Android smartphones, which lack a standardized way of transferring music over their pin connectors, and to the rise of smartphones, which are replacing iPods and other-brand MP3 players as the preferred device for on-the-go music playback.

iPod users, suppliers explain, have traditionally been happy to dock iPods to a tabletop speaker, but smartphone owners generally prefer to keep the device in their hand or pocket even when at home to quickly answer phone calls or access the Internet.

For his part, Ben Arnold, The NPD Group‘s director of industry analysis, attributes Bluetooth-speaker sales growth to growing sales of smartphones and tablets — which people are buying to consume music, gaming, and video — and to the inclusion of stereo Bluetooth in almost every smartphone and tablet.

“We’ve gone from 30-second cat videos on YouTube to full-length movies in Netflix and HBO Go that people are watching on these devices,” Arnold said. “Music-streaming services are growing, which is also being pushed by mobile.”

Bluetooth speakers are also up “because consumers enjoy the convenience of wireless,” Arnold continued. “It’s also worth mentioning that Apple’s transition to the Lightning connector may drive some who have 30-pin connector devices towards the Bluetooth devices.”

Because of the popularity of wireless, unit sales of docking speakers at retail flattened in the first quarter, Arnold noted.