In the three short years since Amazon launched Echo speakers, sales have exceeded 42 million units, creating a new smart speaker category that by September 2018 had clocked up over $6 billion in retail sales.
What’s more, 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 that more than 5 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 over year, to nearly 29 million units. The innovative feature-sets built into VAs, coupled with low price points, continue to whet consumer appetites, especially in markets like the U.S., U.K. and, increasingly, China. These countries are all avid adopters of the latest consumer tech, and represent over 90 percent of smart speaker units sold, despite the fact that the products are now available in many more markets.
However, Futuresource’s consumer research shows that privacy is a key inhibitor to uptake, especially in Germany and Eastern Europe, but we expect these concerns to be outweighed in the future by the benefits and convenience of VAs. Our 2018 Smart Home Devices & Appliances consumer survey revealed that 38 percent 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 consumer fears of devices that eavesdrop on conversations.
While smart speakers already come in several shapes and configurations (with display screens, ZigBee, better audio and cameras), consumers are generally choosing the most basic of feature sets, with Amazon’s Dot and Google’s Home Mini on track to comprise almost two-thirds of those companies’ smart-speaker 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 (music and TV) to integration into the smart home’s infrastructure, controlling lighting, security and heating.
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The VA battle for the living room is likely to be the most hotly contested area of the smart home, where 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 and 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, with assets that 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 saw a growing number of soundbars, smart TVs, media streamers, consoles and set-top boxes (STBs) incorporating far-field microphones to wake up Google Assistant and Alexa. Futuresource estimates that 53 million smart speakers sold worldwide in 2018, but a further 65 million 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 user interface (UI). Moving forward, wireless headphones and wearables have the potential to unleash VA usage in mobile devices as wake-word technology and push-to-talk buttons penetrate these categories. Futuresource estimates that 24 million headphones shipped with VA support in 2018, and that number is expected to rise to 154 million 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 behavioral 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.