The market for wireless speakers enabled by virtual personal assistants is set to from $720 million last year to $3.52 billion in 2021, according to Gartner.

“The market for VPA-enabled wireless speakers, such as the Amazon Echo devices and Google Home, is expanding rapidly with more vendors, device types and use cases,” said Gartner Research Director Werner Goertz in a press release. “We expect a temporary slowing of growth in 2018, as other devices, such as lighting systems, hubs and Wi-Fi mesh devices, adopt VPA functionality, especially in connected home scenarios.”

Gartner identifies healthcare as a prime target for VPA-enabled wireless speakers. It says that remote diagnostics and elder care applications will increase efficiencies and encourage patient use. This, according to Gartner, will lead the ecosystem to at least partly subsidize hardware and software costs.

A key part of the evolution will be the third generation of VPA speakers, which is expected to hit in 2019. At that point, VPAs will feature on-board artificial intelligence features. Avoiding the cloud will reduce latency, help meet privacy and security challenges and increase bandwidth efficiently, Gartner says.

Another milestone in 2019 will be the move of VPAs from being purely consumer products to enterprise use, starting with the healthcare and hospitality sectors. The new variations of devices that flow from this will further drive the market.

Gartner says that by 2020, privacy concerns will have faded as an issue for 90 percent of the target market. The firm suggests that these worries are a more a function of market psychology than real vulnerabilities since devices can’t be exploited unless the “trigger word” is recognized.

VPA-Enabled Wireless Speakers Market Data
In May, eMarketer said that the Amazon Echo controls 70 percent of the U.S. voice-controlled speaker market. Google Home is second at 23.8 percent, which players such as Lenovo, LG, Harmon Kardon and Mattel are in the market but are even further behind. The firm expects Amazon’s percentage to remain in the 70 percent-range even as the consumer market grows aggressively. This year, the firm said, 35.6 million Americans will use a voice-activated digital assistant, a 128.9 percent increase from 2016.

Late last year, Scripps Networks Interactive released a consumer survey that said smart speakers were cited as an attractive kitchen product, along with app-enabled appliances and motion sensor lighting.

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