Canalys: the number of smart speakers in use will come close to 100M by the end of 2018, up from under 50M at the end of 2017, and there will be 225M+ by 2020
Chris O'Brien / VentureBeat :
Context & Ripple Effects
Canalys has been tracking smart speakers' breakout year all along: its January call for 56.3M units sold worldwide in 2018 framed the category as outpacing AR, VR, and wearables, and its Q1 tally showed Google briefly overtaking Amazon on shipments. The new forecast shifts the metric from quarterly sales to installed base — under 50M devices in use at the end of 2017, approaching 100M a year later, and 225M+ by 2020.
That doubling matters because the installed base is what turns a gadget into a platform: subsequent Canalys data confirmed the pace, with Q3 2018 sales up 137% YoY and the US plus China already accounting for 70% of the market, while rival firm Strategy Analytics logged an even steeper Q4 ramp.
First-order effects
- Amazon and Google are now competing primarily on accumulated devices rather than quarterly shipment wins — Google's Q1 2018 lead over Echo proved temporary, and the installed-base race rewards whoever sustains volume across quarters.
- China's emergence alongside the US as half the global market gives Alibaba, Baidu, and Xiaomi a large domestic lane that Amazon and Google cannot directly contest.
Second-order effects
- As the base approaches 100M, hardware pricing pressure intensifies: vendors can afford to sell speakers near cost because each device is a distribution point for voice services, music, and commerce — a dynamic visible in the aggressive Mini-class pricing both leaders adopted through 2018.
- Content and service providers gain a second screen-free surface, forcing them to optimize for voice discovery just as they did for mobile apps a decade earlier.
Third-order effects
- If the 2020 projection holds, voice assistants consolidate into a two-horse ecosystem structure — Amazon and Google controlling the default entry points to the connected home — with third-party device makers licensing assistants rather than building their own.
- Regulators and privacy watchdogs face a step-change in always-listening microphones inside homes, since an installed base doubling yearly moves voice data from niche to mass-scale collection.
The trend: Smart speakers are scaling from early-adopter gadget to mainstream computing platform, with annual installed-base doublings making voice the next major interface battleground between Amazon and Google.