90% of smart speakers will die? Who will persist for longer?

However, looking ahead, smart speakers are expected to evolve into the central control hub for smart homes. They may expand into new use cases, and understanding user behavior will be key. Will smart speakers become a massive market or a playground for entrepreneurs? Who will take the lead in this space? These questions have sparked thoughtful discussions across the industry.

The 49th Wudaokou Salon hosted by NetEase Science and Technology brought together industry leaders, including Fang Fang from Linglong Technology, Jin Xin from Ji Jin FM, Lung Meng Zhu from Sibi Chi, Wang Gang from Xiaomi, Duan Yu from Shun Wei Capital, Xie Dianxia from Zhi Zhi, Lin Yili, and Song Shaopeng from Sugr Midtown Technologies. Experts from platforms, hardware vendors, content providers, tech service firms, and investors shared their insights on the future of smart speakers.

Differences Between Echo and Domestic Smart Speakers

Echo is often seen as the benchmark for smart speakers. When people talk about voice-activated devices, Echo is always mentioned. In China, domestic smart speakers are frequently compared to Echo. However, Long Meng Zhu pointed out that while foreign markets focus more on foundational innovation, China excels in application-level development. She believes China will eventually produce even better products than Echo, and there’s a lot to look forward to.

Fang Li noted that both Echo users and Chinese users engage heavily with on-demand content. Additionally, China’s O2O services—like online shopping—are growing rapidly.

Song Shaopeng described the three stages of Echo adoption: early adopters were mainly tech-savvy men in 2015, followed by a broader audience in 2016, with more women aged 35–50 joining in. By 2017, the market expanded further, with younger adults entering the scene.

He predicted that future buyers might include tech enthusiasts, younger generations, parents buying for their kids, and young students or white-collar workers.

What Will Voice Interaction Look Like in 3–5 Years?

Long Mengzhu believes Echo was a lucky product, but the direction of voice assistant development is inevitable. The future of Echo might not be limited to speakers—it could appear in TVs, refrigerators, routers, or even pens.

Wang Gang disagrees, arguing that smart speakers won’t necessarily be the family’s central device. He sees a future where voice interaction becomes multi-centered and eventually decentralized, with all devices having voice capabilities.

Jin Xin emphasized that voice interaction remains a crucial form of user engagement, especially when combined with visual elements. He hopes users will demand more content, better device control, and stronger personal assistants.

Fang Li thinks that in the short term, voice interaction will extend beyond speakers, with earphones becoming a major testing ground. Song Shaopeng urged people not to limit themselves to the word “speaker.” Just as phones evolved over the years, smart speakers will also change significantly in the coming years, creating many new opportunities.

Future Service Models

With user profiles, what kind of services will people need? Song Shaopeng said Echo currently serves three main categories: music, time management, and information retrieval. He predicts common uses will include listening to songs and content, while Jin Xin believes content demand will be strong, along with food delivery and smart home control.

Long Mengzhu added that future products will be more specialized, leading to more segmented content. Examples include Xiaomi’s smart home control and Tmall’s improved payment experience. Other industries will also enhance voice-based services.

Fang Fang revealed that while current speaker shopping experiences are still lacking, next year interactive screen-enabled devices will be introduced, making shopping a key focus. Education, such as partnerships with New Oriental, and smart device control are also top priorities.

Wang Gang highlighted plans to integrate WeChat and open up the platform for developers on Xiaomi’s ecosystem.

Giants or Entrepreneurs?

With companies like Amazon, Google, Apple, and Microsoft entering the market, and Chinese players like Alibaba (Tmall Elf), JD.com, Tencent, and Baidu also investing, the question remains: is the smart speaker market dominated by giants or entrepreneurs?

Xie Dianxia believes the Chinese market is complex and diverse, so there may be one or two dominant players, alongside niche innovations. He sees Xiaomi as having a strong advantage.

Song Shaopeng thinks smart speakers are just the first step in voice interaction. Different companies will excel in different areas, similar to how BAT handled mobile internet. Competition will be scene-driven.

Lin Yili emphasized the importance of openness. Even big companies must remain open; otherwise, they risk being left behind. He believes the AI smart hardware era is still very open.

Will 90% of Companies Fail?

Some say 90% of smart speaker companies will fail next year. How can businesses survive longer?

Lin Yili said companies without a competitive edge in price, experience, or distribution will struggle. Only those that deliver real value to users will endure.

Song Shaopeng believes the market is still in its early days, and many companies will be eliminated. To survive, they must have strengths in channel, brand, experience, or pricing.

Xie Dianxia agreed but noted that even large companies may last a while. While the market will consolidate, smaller brands and niche segments will continue to exist for some time. The competition cycle may be longer than that of smartphones.

Technological Breakthroughs in Smart Speakers

From a technical perspective, natural language understanding will be key. What breakthroughs can we expect in voice conversation technology soon?

Xie Dianxia believes that if existing technologies are well-defined and data-rich, the user experience could surpass that of mobile phones. But the challenge lies in messy data and machine tolerance.

Algorithms are also advancing, especially in speech recognition, which is already comparable to human performance. However, full conversational AI will take several more years.

Song Shaopeng added that technical challenges fall into two categories: immediate and long-term. Issues like regional accents and language models require time and engineering efforts to solve.

Another key challenge is the increasing role of humanities in AI development. As voice interaction expands, the need for culturally aware and context-sensitive systems will grow.

Whether in the form of a smart speaker or not, the voice interaction market is unstoppable. Industry experts believe the 100 million-unit milestone is just around the corner, and the market will develop rapidly. Voice technology is set to become a blue ocean. (quiet)