The analyst firm, IDC, has said that it expects smart home devices to remain resilient this year despite the coronavirus’ effects on world economies. It said the sector will see a growth of 4.1% year-over-year in 2020 with shipments reaching 854 million units.
Over the longer term, IDC expects that worldwide shipments will be more than 1.4 billion in 2024 with a five-year compound annual growth rate of 14%. The firm said this growth will come as a result of people spending more and continuing to invest in home automation devices and services.
Commenting on the finding, Adam Wright, a senior research analyst and IDC said:
“From a demand-side perspective, smart home devices have remained quite resilient during the global COVID-19 pandemic. The market has lost some ground in 2020 compared to prior forecasts – a result of high unemployment and lock-down measures, among other factors – but nevertheless we anticipate positive year-over-year growth in 2020 across all device categories. As consumers shift their spending priorities from other areas like vacations, travel, and going out to eat, smart home devices have remained broadly popular.”
In 2024, the market share of video entertainment smart home devices is expected to be 31.3%, this is a fall of about 10% since 2020 but still makes it the largest smart home sector. Home monitoring and security will grow from 19.5% in 2020 to 21.1% in 2024, and smart speakers are expected to drop from 15.6% to 14.1% in the same years.
The decline in market share for video entertainment and smart speaker devices is due to the ‘others’ category which is expected to go from 23.4% in 2020 to 33.5% in 2024. Despite an overall smaller market share for some of these categories, all of them will see a big increase in shipments compared to today.
IDC says that while the smart home sector will grow over the coming years, concerns around security and privacy will remain. It also said upfront and on-going costs of devices and services could prove to be a challenge as well as uncertainty in labour and financial markets around the world.