Friday, 25 August 2017 11:36

VPA-Enabled Wireless Speaker spending to hit US$3.5 billion by 2021: Gartner

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Consumer and business spending on the virtual personal assistant-enabled wireless speaker market is forecast to reach US$3.52 billion by 2021, up from US$0.72 billion in 2016, according to a new global report.

The report by Gartner says beginning in 2019, third-generation VPA speaker products will start shipping with some artificial intelligence functions running on the device rather than in the cloud – and the analyst firm expects these AI-enabled VPA speakers to use edge-device, machine-learning capabilities to enhance latency, alleviate privacy/security issues and use bandwidth more efficiently.

"The market for VPA-enabled wireless speakers, such as the Amazon Echo devices and Google Home, is expanding rapidly with more vendors, device types and use cases," said Werner Goertz, research director at Gartner.

"We expect a temporary slowing of growth in 2018, as other devices such as lighting systems, hubs and Wi-Fi mesh devices adopt VPA functionality, especially in connected home scenarios."

Gartner says that although the VPA speaker is thought of as a consumer device, in 2019, starting with the hospitality and remote healthcare industries, enterprise adoption will drive further market growth through a fragmented portfolio of specialist devices.

"In healthcare, remote diagnostics and elder care applications will be enabled by VPA speakers. The cost of hardware and services will, at least in part, be subsidised by healthcare ecosystem partners who are likely to gain substantial efficiencies, and encourage patient adoption," said Ranjit Atwal, research director at Gartner.

"Specialist VPA speakers with custom-made hardware and software configurations will roll out in the retail sector in 2020 and beyond. New self-service, voice-based shopping and payment experiences will be enabled, reducing friction in the bricks-and-mortar as well as e-commerce shopping environments."

And Gartner notes that by 2020, enterprises' data privacy will not be a concern for 90% of the target market.

"Concurrent with the introduction of the Amazon Echo in 2014 were reports about personal devices 'snooping' on private conversations in the home," Goertz said. "Understandably, consumers raised concerns about intrusions into private conversations."

He says that although concerns over privacy have little technical merit — the device has no processing capability unless the trigger word is recognized — market psychology is a current obstacle.

In fact, Gartner believes that by 2020, such concerns would have largely been mitigated through educational efforts, adoption by peers and regulatory approvals of the device category, and by that time, lingering concerns will be confined to a percentage of the market that is small enough to be insignificant.

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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

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