Amazon Echo, Google Home to lead smart home market by 2022

Convenience outweighs security concerns for smart home tech buyers, new report shows

Amazon Echo is one of the devices for which sales are expected to surge in the run up to 2022.
ITP.net
Amazon Echo is one of the devices for which sales are expected to surge in the run up to 2022.

Smart home automation devices, especially assistants such as Amazon Echo and Google Home, will boom in the period to 2022, new research has found. 

Device shipments across various smart home technology products – such as smart speakers, video entertainment systems, connected lighting, smart thermostats, and home monitoring and security systems – are expected to grow by 31% year-on-year (YoY). Smart home product shipments included 643.9 million products in 2018, with the number expected to reach 1.3 billion in 2022, expanding at a compound annual growth rate (CAGR) of 20.8%. 

With a CAGR of 39%, smart home assistants such as Amazon Echo and Google Home will be the fastest-growing category within the pool of smart home technology. Home assistant sales totalled 100 million in 2018, with the number expected to rise to 230.5 million by 2022, a report by IDC found.

Connected lighting, thermostats, and related products combined are expected to grow at a five-year CAGR of 26.9%, with lighting products accounting for almost a third of the shipments, Construction Week's sister title ITP.net reported. Smart thermostats, while popular in North America, will continue to face slower growth in the rest of the world, as many markets do not use centralised heating, ventilating, and air-conditioning systems, thereby reducing their preference for dedicated thermostats.

Interestingly for facilities and property management companies, the market for home monitoring and security devices – such as door and window sensors; door locks; and IP cameras – is expected to make up 19.4% of the total smart home market’s performance by the end of 2022. IDC said that the segment “faces great potential with a five-year growth of 27.3%”, but continues to be viewed as a niche-buyer product – commonly, homeowners – since most home security products currently in the market do not offer value for apartment residents.

Meanwhile, smart TVs and digital media adapters such as Google Chromecast and Apple TV will grow by 10.9%, with their shipment number expected at 457.5 million in 2022. IDC said this segment would act as a gateway to smart home ecosystems, as a result of which the space may see increased competition in both price and content. 

Finally, smart speakers, despite being a hot topic of discussion for the industry in 2018, will only account for a third of smart home unit sales by 2022 as platforms are launched to be compatible with Amazon’s Alexa or Google Assistant. Siri, Cortana, and Bixby will also note an expansion of market share, but they are unlikely to overtake Google or Amazon in terms of shipments anytime soon. 

IDC found that while smart speakers independent of the above platforms will continue to comprise a significant position of the market, their uptake will largely come from China, where players such as Xiaomi and Alibaba already have a major advantage. 

In the years to come, the convenience of smart home devices will outweigh concerns surrounding privacy, according to IDC’s senior research analyst for consumer internet of things programmes, Adam Wright. 

“Security and privacy are top of mind for most consumers when considering deployments of smart home devices,” Wright continued. 

“In addition to having adequate security solutions in place when bringing devices to market, vendors must also respond to consumers’ concerns by properly educating them about these safeguards and raising awareness about the benefits of sharing data that can ultimately provide better devices, services, and experiences over time.”

EDITOR'S RECOMMENDATIONS:

Most popular

Awards

Deadline approaches for CW Oman Awards 2020 in Muscat
You have until 20 January to submit your nominations for the ninth edition of the

Conferences

CW In Focus | Inside the Leaders in KSA Awards 2019 in Riyadh
Meet the winners in all 10 categories and learn more about Vision 2030 in this
CW In Focus | Leaders in Construction Summit UAE 2019
A roundup of Construction Week's annual summit that was held in Dubai this September

Latest Issue

Construction Week - Issue 765
Jun 29, 2020