Suppliers of Wi-Fi multiroom-audio speakers are coming to CES with a growing selection of smart speakers to tap into the sales energy generated by their Amazon- and Google-branded counterparts.
Analysts forecast a continuing double-digit surge in sales of smart Wi-Fi speakers, which incorporate voice-controlled digital assistants, and a decline in sales of Wi-Fi speakers that lack digital assistants.
Here at CES, attendees will find new smart speakers incorporating either Google Assistant or Amazon Alexa built in.
“Voice control is pretty necessary in the future [for Wi-Fi speakers],” said Kevin Brannan, director of marketing for the Onkyo, Integra and Pioneer home audio products.
In 2017, Amazon and Google accounted for 99 percent of U.S. smart-speaker unit sales of 20.7 million units, while CE brands’ smart speakers were expected to ship fewer than 500,000 units, given that almost all CE-brand models didn’t ship until the fourth quarter, said Futuresource analyst Rasika D’Souza.
Although audio brands and other CE brands will grow in this space, their shipments will not match Amazon’s or Google’s in the short to mid terms, she continued. Amazon and Google “have the advantage of being early entrants into key markets and have gotten consumer excited with their products. Moreover, they offer many more products at lower price points, which potentially audio companies might not be able to offer.”
The growth of Amazon- and Google-branded smart speakers “has impacted the Wi-Fi non-smart speaker market,” D’Souza also noted. Preliminary Futuresource statistics show a 16 percent drop in 2017 U.S. shipments of non-smart Wi-Fi speakers (including non-smart Wi-Fi/Bluetooth combo speakers) to 2.23 million units, with another 29 percent drop forecast for 2018. “This segment will continue to fall as more brands integrate voice into their Wi-Fi speakers,” she noted. On the other hand, sales of smart Wi-Fi and smart Wi-Fi/Bluetooth speakers soared 170 percent in 2017 to 20.7 million units and were forecast to grow another 30 percent in 2018.
In its mid-2017 forecast, CTA expected the growth of non-smart Wi-Fi speakers to slow in units and dollars starting in 2018 even as sales of smart speakers continue to surge at double-digit percentage rates.
Profit warning: Though smart speakers will soar, profits on their sales might not. Said Arman Arami, president of Bluetooth-speaker maker NYNE, “Amazon and Google have seen an opportunity and, using the Wi-Fi audio platform, are capturing what they have been looking for: consumer data.” He continued, “I would not be surprised if, in the near future, they give their speakers away for free in order to capture valuable consumer data.” – Twice