China overtakes U.S. as world’s biggest smart speaker market

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I sent the HomePod back, so I will keep using the single photo I took until somebody stops me.
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Photo: Charlie Sorrel/Cult of Mac

China has overtaken the U.S. as the world’s biggest smart speaker market. According to new figures from Canalys, the Chinese market grew nearly 500% year-on-year in the first quarter of 2019.

Approximately 10.6 million units shipped in China over the quarter, compared to 5 million in the U.S. This means that China is now 51% of the global global smart speaker market. The U.S., on the other hand, comes in second place at just 24%.

“The lightning fast development in China is largely driven by vendors pouring in large amount of capital to achieve dominant share quickly,” said Nicole Peng, VP of Mobility at Canalys “This strategy is favoured by internet service providers like Baidu, Alibaba and Tencent who are used to spending billions on traffic acquisition and know how to reach critical installed base fast.”

Winners and losers

The big winner in this is Baidu, whose new Xiaodu devices shipped 3.3 million units in the quarter. That’s only slightly fewer than the far more established Google’s 3.5 million. Baidu benefitted from the a sponsorship deal with national TV channel CCTV.

It was prominently featured on the channel’s New Year’s Gala on Chinese New Year’s Eve. This is the biggest entertainment show of the year on Chinese television. Xiaomi and Alibaba speakers, which have been around for longer, also sold very well in the quarter. Both saw shipments of around 3.2 million. Xiaomi had overall year-on-year growth of 411.4% growth.

Amazon remains smart speaker king, with a total of 4.6 million Echo devices shipped in Q1. In the first quarter of the year, it had a global market share of 27.7%. It also saw annual growth of 84.7%.

Somewhat tellingly, Apple lags behind somewhat. Canalys doesn’t even break out HomePod as its own figures. It is included as part of the “Others” category, representing 17.3% worldwide. This category is growing (up 89.8% year-on-year). But it’s also revealing that a major brand like Apple isn’t even broken out as its own figures.

What is most likely hurting Apple is the lack of availability of a low-end affordable smart speaker, such as the Amazon Echo Dot. Maybe Apple will announce something at WWDC? After all, its first generation device was first unveiled at WWDC back in 2017.

Source: Canalys