Smart Speakers Finally Taking Off in China With Push From Alibaba, Says Report

Chinese artificial intelligence platforms are scrambling to replicate Amazon’s Alexa success in the U.S. in their domestic market, said a Monday blog post from Futuresource, which bumped its smart speaker sales forecast to 10 million units for 2018 -- 20 percent of global demand -- based on ballooning growth over the past six months. While online retailer JD.com, entered the China market first in 2016 using the iFlytek voice platform, e-commerce giant Alibaba took the category to the next level with the $75 Tmall Genie, said analyst Rasika D'Souza. Like Amazon, Alibaba sells direct to consumers, and it heavily discounted the Tmall Genie during its Singles Day promotion, logging sales of 1 million units in the launch quarter, she said. Xiaomi, meanwhile, launched a $30 speaker in Q4, along with a smart home and entertainment control ecosystem. In Q1, the smart speaker category sold more than 1.5 million units in China with CE retail chain Suning and smaller Chinese brands and third-party players coming to market, said Futuresource data. Baidu, the biggest search engine in China, bowed the $95 screen-based Little Fish smart speaker at CES, and has teamed with other speaker vendors to expand its ecosystem in consumers' homes, said the report. Smart speakers could have a positive impact on in-home music listening, not a popular activity in China, where most listening is done on the go using headphones, D'Souza said. Voice control was evident on the streets in China, said D'Souza, after a trip there last month, where she observed pedestrians and drivers giving voice commands to their devices, typically for navigation services. The growing use of voice-based services puts Chinese AI platforms at an advantage in user volume, said the analyst, citing a total available market of a billion across mobile devices and other hardware. “This scale of use will ensure the platforms quickly become far more sophisticated and extend beyond smart speakers to penetrate the home, car, mobile and B2B ecosystems,” she said.