NEW YORK, NY, 11 December 2018—Deloitte Global forecasts smart speakers will be worth US$7 billion in 2019, becoming the fastest-growing connected device category. This is according to Deloitte’s 18th edition of Technology, Media & Telecommunications Predictions.
Smart speakers are continuing to fly off shelves, selling 164 million units at an average selling price of US$43 per unit. Total industry revenues will be up 63 percent, compared to $4.3 billion in 2018. However, the industry will have to overcome looming obstacles to reach its full growth potential. Speech recognition technologies continue to improve, but wider language support will need to be developed for the technology to be inclusive and experience global adoption.
Deloitte also predicts that in 2019 companies will further accelerate usage of cloud-based artificial intelligence (AI) software and services. Among companies using AI, 70 percent will obtain AI capabilities through cloud-based enterprise software, 65 percent will create AI applications using cloud-based development services, and by 2020, the penetration rate of enterprise software with AI built in, and cloud-based AI development services will reach an estimated 87 and 83 percent respectively.
“So far, AI’s initial benefits have been predominantly accrued by ‘tech giants’ with extensive financial resources, strong IT infrastructure, and highly-specialized human capital,” says Paul Sallomi, Deloitte Global Technology, Media & Telecommunications industry leader. “However, the cloud will power increased efficiencies and better returns on investment, and we expect these benefits to rapidly extend beyond AI’s pioneers to the wider enterprise.”
Fifth-generation (5G) wireless networks are expected to arrive in scale, providing faster connections for consumers and enterprises, and opening revenue opportunities for telecommunication companies.
Wireless operators have been pouring resources into 5G network development in fact, 72 operators are currently testing this offering – and Deloitte forecasts that in 2019, 25 wireless operators will launch 5G service, a figure that will likely double by 2020. In total, over one million 5G handsets are expected to be sold in 2019, and that number should expand to 15-20 million units by 2020. A further million 5G pucks/modems are also predicted to sell in 2019.
“Wide-scale adoption of 5G devices will take time, but we believe 2019 will be the starting point for sweeping change for the wireless industry,” says Craig Wigginton, Deloitte Global Telecommunications sector leader. “5G can provide hundredfold increases in traffic capacity and network efficiency over 4G, and this has transformative potential on the future of connectivity worldwide.”
“2019 will be defined by how new technologies steadily reshape how we live and work,” says Mark Casey, Deloitte Global Telecommunications, Media & Entertainment sector leader. “From smart speakers to 5G networks, and everywhere in between, accessibility to advanced technologies is quickly improving. As the barriers continue to fall, the potential for greater connectivity and further innovation will increase exponentially.”
Now in its 18th year, Deloitte Global’s annual TMT Predictions provide an outlook on key trends in the technology, media, and telecommunications industry sectors worldwide. Visit Deloitte.com/predictions to learn more and connect with us on Twitter: @DeloitteTMT and #DeloittePredicts.
To ensure sustained business growth, it is critical that organizations address the increasing disruption posed by emerging technologies. Deloitte’s Technology, Media & Telecommunications (TMT) industry practice brings together thought leaders and trusted specialists to shape many of the world’s most recognized brands in these fields. Through its work, the TMT team aids clients in creating competitive advantage and helps them succeed in an increasingly digital world.
Deloitte Global’s annual TMT predictions serve as guideposts for future business strategy by providing a 1-5 year outlook on key trends in the global technology, media, and telecommunication industry sectors. The trends help identify key challenges and areas of focus for the world’s TMT brands as they navigate the impact of new technologies shaping the future of industry.
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