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Alibaba Plots Comeback in Smart Speaker Race

Neha Gupta - Author

Jul. 31 2019, Updated 2:35 p.m. ET

Allowing drivers to shop from behind the wheels

Baidu (BIDU) last quarter dethroned Alibaba (BABA) as the world’s third-largest smart speaker company, according to data from Strategy Analytics. It captured a 15.8% share of the global smart speaker market in the first quarter, rising over Alibaba whose share was estimated at 14.1%. Alibaba was firmly on top of Baidu a year ago, when its share of the global smart speaker market was estimated at 11% against Baidu’s 0.1% share in the first quarter of 2018.

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But Alibaba is plotting a comeback. The company recently entered agreements with Audi, Renault, and Honda Motor to include its smart speaker technology in their vehicles, the South China Morning Post reported. With this partnership with automakers, Alibaba’s goal is to put its smart speaker technology in front of more customers, which could in turn help it sell more smart speaker devices. Drivers of vehicles fitted with Alibaba’s smart speaker technology will be able to shop from Alibaba’s online marketplace through voice commands or control-smart appliances all while behind the wheel.

Amazon dominates smart speaker market

The smart speaker business presents an attractive growth opportunity for growth-focused companies like Alibaba. The global smart speaker market was valued at $4.4 billion in 2017 and is forecast to grow to $23.3 billion by 2025, according to Research&Markets’ predictions. At the moment, Amazon (AMZN) dominates the global smart speaker scene with 21.7% market share at the end of March. Google (GOOGL) came in second with an 18% share. Other companies pursuing smart speaker dollars include Facebook (FB), which last year launched a smart speaker device called Portal that can also be used for video calling.


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