Growth in Smart Home Impeded by Privacy Fears; Devices Up 5% in 2020

Smart home device shipments grew 4.5% year on year in 2020 to 801.5 million units, said IDC Friday, growing to an estimated 1.4 billion in 2025. Smart home devices such as streaming sticks, smart speakers, security devices and smart lights performed well, as consumers shifted spending toward the home and away from vacations and dining out, said analyst Adam Wright. The U.S. represented most shipments and is forecast to ship 451.3 million units in 2025, but China is forecast to overtake the U.S. by the end of 2024, growing at a 21.9% compound annual growth rate, said the researcher. Video entertainment devices at 27.6% will be the largest share of shipments in 2025 on falling prices and feature advances such as 8K, HDR, larger sizes and integration with smart assistants, said IDC. Growth in the maturing smart speaker and display segment will slow as consumers look for other form factors to access smart assistants, including thermostats, appliances and TVs. Ongoing concerns about security and privacy will limit the smart home device market, along with consumers’ price sensitivity to upfront and ongoing costs of devices and services and macroeconomic conditions, it said.