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In 2014, Amazon released the first Echo smart speaker as they sought to expand their hardware beyond the Kindle e-reader.
They pioneered a new category of devices and caught traditional tech giants like Google and Microsoft flat footed.
But by 2016 as Amazon expanded their Echo lineup, other companies, notably Google, had taken steps to develop their own smart speaker. Apple also had plans to jump into the fray which they did at the start of this year with the launch of HomePod.
But even with the release of the first Google home smart speaker in 2016, Amazon continued to dominate the industry they had created.
In 2017, Amazon Echo speakers had about 70%-80% of market share.
By 2018 however, Amazon seemed to be feeling the heat from Google Home and Apple HomePod.
Q1 and Q2 Smart Speaker Sales
Google Home has steadily increased market share over the last couple of years. In 2017, they had about 20% of market share, far behind Amazon Echo.
In 2018 however sales for Google Home rose rapidly.
In fact, an analysis by Canalys suggests that Google out-shipped Amazon Echo in the first two quarters of the year.
In the first quarter, according to the report, Google Home shipped 3.2 million devices while Amazon Echo shipped 2.5 million of their smart speakers. That was the first time Google had sold more smart speakers than Amazon.
In the second quarter, Google shipped 5.4 million smart speakers while Amazon shipped 4.1 million.
Who’s Really The Market Leader?
It’s important to note that this report by Canalys is based on estimates. Tech companies don’t usually report exactly how many devices they shipped.
You also have to remember that this report doesn’t account for third party devices like Sonos One and Ecobee4 that come with Alexa built-in.
So there could be many more ‘Echos’ sold than has been reported.
In fact, another analysis by Strategy Analytics still puts Amazon in the lead saying that the company shipped 4.1 million devices while Google shipped 2.4 million in Q1.
But the report notes that Amazon has lost significant market share.
However, there is no clear cut market leader. But there are two inarguable things that are clear in these reports.
1. Google is Catching Up…Quickly
We cannot be sure whether Google has finally caught up to Amazon and probably surpassed them. But what is clear is that Google is no longer a small player in the smart speaker category.
Their Google Home Smart Speaker is currently one of the best smart speakers. It stacks up well against Amazon Echo and even does better in some areas like search. (See how they compare in our in-depth smart speaker comparison)
Google has done well to replicate Amazon’s strategy of launching multiple devices.
There’s the main Google Home speaker to compete against the Amazon Echo 2, Home Mini to compete against Echo Dot and Home Max which doesn’t have a direct competitor in the Echo lineup.
Google is also reportedly planning a screened smart speaker to compete against Echo Show.
Google’s focus on providing a range of devices to choose from and their efforts to integrate thousands of third party services and products with Google Assistant have clearly paid off.
More and more people are opting for a Google Home smart speaker over the alternatives from Amazon and Apple.
2. More and More People are Buying Smart Speakers
The most interesting nugget, at least in my opinion, in Canalys’ analysis wasn’t that Google had sold more devices than Amazon. It was the sheer increase in the number of smart speakers shipped.
In Q1, according to Canalys’ estimates, Google shipped 3.2 million smart speakers. In Q2, they shipped 5.4 million.
In Q1, Amazon shipped 2.5 million smart speakers. In Q2, they shipped 4.1 million.
That’s a huge increase for both companies.
Accounting for all smart speaker brands in the market, Canalys says there was a 187% increase in shipments from Q2 of last year to Q2 in 2018.
Smart speakers are no longer a novelty. One estimate suggests that 39 million Americans own a smart speaker.
Forrester Analytics forecasts that 66 million American households will have a smart speaker by 2022.
This has been driven in part by the overall smart home revolution. As people add more smart devices to their home, they are also getting smart speakers partly to use them as control hubs.