TrendForce reveals who is winning the smart speaker race

Although Apple has now officially entered the ‘smart’ speaker market, Amazon remains the market leader according to a report from research specialist TrendForce.

Competition may be fiercer than ever in the voice-controlled speaker market but Amazon continues to reap the benefits of being the first to market and the far-reaching availability of Alexa skills.

They currently lead the market by accounting for around 50.8% of shipments, although it’s down nearly 20% on 2017 market share (which was estimate to be at around 69.1%).

The share of Google Home is projected at 21.6%, ranking the second. The recently released Apple HomePod is expected to reach a share of 8.9%, while the numbers for Alibaba’s and Xiaomi's smart speakers will be 6.3% and 5.1% respectively.

Analyst at TrendForce, Tom Tien, outlines that he expects the smart speaker market is expected to draw more attention with Apple actively in the marketplace.

He adds that although many companies have entered this market, Amazon remains the leader thanks to its establishment of a complete business ecosystem. Specifically, in the US market, applications supported by Alexa have surpassed the 25,000 mark. This coupled with a wide range of products and low prices, TrendForce finds consumers are more willing to buy Amazon Echo.

It’s worth noting smart speakers launched by these brands are mainly based on speech recognition of English. As the result, they find it hard to fully take advantage of the Chinese market according to TrendForce, despite the opportunities there. Therefore, Alibaba and Xiaomi have entered smart speaker market in 2017, focusing on developing products for Chinese market.

Alibaba cuts into the market with its self-developed artificial intelligence and cloud technologies, while Xiaomi is backed by its broad product mix of hardware, which will enable the two companies to catch up, say they analyst.

However, Tien points out three main challenges for HomePod that may influence its product acceptance in existing market. First, HomePod puts more focus on audio performance than technology-led home assistance which he state should be the “core value” of a smart speaker. Second, the business ecosystem for Apple has a high standard so that application providers may find it difficult to enter. As the result, Tien believes HomePod’s limited support for third-party apps will make it harder for HomePod to fully realise the functions of smart speaker. Third, some functions of HomePod overlap with Siri in iPhone.

The above three factor will likely affect HomePod’s sales despite the huge awareness of Apple, thus TrendForce forecasts that Amazon will still continue to dominate the smart speaker market in 2018.