According to data released Thursday, Apple now makes up 29% of the TWS (that’s “true wireless stereo hearables”) market. The biggest competitor in terms of shipments is Xiaomi, which represents 13% of the market, followed by Samsung with 5%. Other players include the likes of JBL, QCY, JLAB, and Sony.
But the news isn’t necessarily bad for Apple. As happened with the smartphone market after the iPhone, Apple’s success means more companies jump in to compete. They gradually lower Apple’s market share, but predominantly by introducing products at a cheaper price than Apple is willing to.
That’s what has happened with wireless hearables, too. As Counterpoint notes, in the third quarter of 2020 half of the top 10 sellers were budget brands with sub-$50 or even sub-$20 offerings. That’s something that Apple is never going to (want to) compete with. Apple caters to a higher end of the market, as seen by the fact that its latest AirPods, the AirPods Max, cost $549. Even the low-end AirPods cost $159.
While Apple’s market share might have declined, the size of the overall pie is increasing. Counterpoint notes that annual TWS hearables shipments increased a massive 83% in 2020 to hit 238 million units. If Apple represents 29% of that, it suggests that it shipped approximately 69 million units in 2020. (That would actually seem to be a little low, since AirPods shipments were expected to hit 60 million in 2019. And things have supposedly climbed considerably since then.)
The other interesting point about the research is that, while hearables are booming, smartwatches as an overall category remains relatively flat. The report suggests that smartwatches saw “subdued category spending to increase 2% to tip the 100m mark.”
For now, smartwatches and hearables are — by far — the biggest products in the wearables market. Whether that changes over time remains to be seen. AR glasses, of the kind that Apple is supposedly working on, may well have something to say about that two-product domination.
Source: Counterpoint Research