Amazon’s early bet on home automation device Echo is paying off.
The e-commerce giant has a 70% share of the emerging voice-controlled speaker market compared to 23.8% for rival Google, research firm eMarketer said on Monday.
Amazon’s huge lead puts it in a strong position in a fast growing business. In addition to making money from selling the devices, Amazon also benefits from Echo users buying more products from the company’s marketplace.
Use of voice-controlled speakers is soaring. An estimated 35.6 million Americans will use one at least once a month in 2017, a 128.9% increase over last year, eMarketer predicts.
Amazon (AMZN) debuted Echo in 2015 as an alternative to using smartphones, tablets, and computers at home. It allows people to use their voice to get answers to questions, turn on lights, order items like diapers, and even request an Uber car pick them up.
Amazon has since incorporated its Alexa voice assistant, which powers the Echo, into its smaller Echo Dot as well as its Fire tablets. Alexa is also being made available to third-party companies like GE Lighting to use in their products.
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Google’ is playing catch up to Amazon with its year-old Echo rival, Google Home, and is still trailing. Google’s device is powered by Google Assistant, which can also be used on Android phones.
Lenovo, LG, and other manufacturers have the remaining 5.6% share of the voice speaker market.
But Apple’s (AAPL) reported plans to introduce its own voice speaker could shake things up considerably considering its expertise with consumer devices. The rival device would incorporate Apple’s popular voice assistant, Siri, a standard feature on iPhones.
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In addition to the growing rivalry over voice-controlled speakers, companies are battling for users of their voice assistants. Use of virtual assistants will grow 23.1% this year, to the point that nearly one in five Americans will use one at least once a month this year, eMarketer said.
Winning the voice assistant wars is considered critically important. RBC Capital Markets estimates that “mega-hit” Alexa could bring Amazon another $10 billion in sales by 2020.
Like with a lot of new technology, younger users are early adopters. Millennials account will account for nearly 27% of voice assistant users and nearly one-third of users of mobile virtual assistant this year, eMarketer said.
