Deloitte Global TMT Predictions 2019
Smart speakers, the resilience of radio, 5G networks, and cloud-based AI increase connectivity and potential for innovation
January 2019 Deloitte Global forecasts smart speakers to become the fastest-growing connected device category, with an installed base exceeding 250 million units worldwide by the end of 2019. In its 18th edition of Technology, Media & Telecommunications Predictions, Deloitte also predicts radio will continue to be the hidden gem for advertisers due to its resilience, and fifth-generation (5G) wireless networks will arrive in scale, opening new possibilities and enabling new enterprise applications of mobile connectivity. Additionally, companies will accelerate their adoption and usage of cloud-based artificial intelligence (AI) as the technology is set to transform industries and society.
Smart speakers – the hear and now
With popular consumer smart speakers continuing to fly off shelves, Deloitte predicts that the smart-speaker industry will be worth €6.2 ($7bn) billion in 2019. At an average selling price of €38 ($43) per unit, total industry revenues could eclipse €3.8 billion ($4.3bn), a 63% growth rate from 2018.
With popular consumer smart speakers continuing to fly off shelves, Deloitte predicts that the smart-speaker industry will be worth €6.2 billion in 2019. At an average selling price of €38 per unit, total industry revenues could eclipse €3.8 billion, a 63% growth rate from 2018.
Richard Howard, Head of Technology, Media & Telecommunications at Deloitte Ireland commented:
Voice assisted speaker ownership in Ireland currently stands at approximately 7%1, but with 30% of Irish consumers owning wireless speakers, we expect to see Irish consumers trading up in the coming years in line with global predictions. However, the industry will have to overcome looming obstacles to reach its full growth potential. Speech recognition technologies continue to improve, but wider language support will need to be developed for the technology to be inclusive and experience global adoption.
Radio star continues to shine brightly
Despite being seen as a part of traditional media, the 99 year old medium of radio continues to perform strongly with most markets recording radio listenership per week of around 90%.
Globally, Deloitte predicts that nearly three billion people will listen to radio weekly in 2019, and that total radio revenue will reach €35bn ($40bn), a one per cent increase from 2018. Figures for Ireland show daily weekday listenership to radio of 82%2. At a time when television viewing figures for most demographics is decreasing and advertisers are assessing how best to spend money in digital advertising, radio continues to have a consistent reach.
Our research also shows that most consumers underestimate their radio listening time, thus its perceived role in our lives is less than it actually is. Combined with the fact that podcast listenership in Ireland has been estimated at 38% versus 18% in the UK and 33% in the US3 we believe that radio and associated podcasts will continue to be a means for advertisers to reach their target demographics. Radio is often seen as a very traditional means of media, however its resilience both via main stream radio and podcasting, makes it an ideal marketing tool for advertisers. We can easily underestimate the amount of radio we listen to at breakfast or while travelling. The radio and podcast listenership rates in Ireland are amongst the highest in the world and this comes down to the quality of the Irish radio product and the informed nature of Irish consumers,
said Richard Howard.
The new network arrives
Wireless operators have been pouring resources into 5G network development – in fact, 72 operators are currently testing this offering – and Deloitte forecasts that in 2019, 25 wireless operators will launch 5G service, a figure that will likely double by 2020. In total, over one million 5G handsets are expected to be sold in 2019, and that number should expand to 12-20 million units by 2020. A further million 5G pucks/modems are also predicted to sell in 2019.
Wide-scale adoption of 5G devices will take time, but we believe 2019 will be the starting point for sweeping change for the wireless industry. Indeed, here in Ireland, in 2019, the first roll-out of 5G services should be seen,
said Richard Howard, Head of Technology, Media & Telecommunications at Deloitte Ireland.
5G can provide hundredfold increases in traffic capacity and network efficiency over 4G, and this has transformative potential on the future of connectivity worldwide.
The democratisation of AI
Deloitte predicts that in 2019 companies will further accelerate usage of cloud-based AI software and services. Among companies using AI, 70 percent will obtain
AI capabilities through cloud-based enterprise software, 65 percent will create AI applications using cloud-based development services, and by 2020, the penetration rate of enterprise software with AI built in, and cloud-based AI development services will reach an estimated 87 and 83 percent respectively.
So far, AI’s initial benefits have been predominantly accrued by ‘tech giants’ with extensive financial resources, strong IT infrastructure, and highly-specialised human capital,
However, the cloud will power increased efficiencies and better returns on investment, and we expect these benefits to rapidly extend beyond AI’s pioneers to the wider enterprise.
Additional topics from Deloitte's 2019 TMT Predictions include:
· China’s connectivity nurtures new digital business models: Deloitte predicts China will have world-leading telecommunications networks in 2019 and most likely in the medium term. Its communications infrastructure will provide a foundation for the gestation and maturation of at least three significant new industries: mobile payments, mobile online shopping, and bike sharing services—each of which could generate tens of billions of dollars in revenue annually by 2023.
· Betting on sports broadcasting –Deloitte predicts that sixty percent of North American men ages 18-34 who watch sports on TV will also bet on sports. In addition, about 40 percent of all US-based TV watching by men 25-34 years old will be driven by sports betting.
· 3D printing breaks through – Sales of enterprise 3D printers, materials, and services from large public companies will surpass €2.4 billion (US$2.7 billion) in 2019 and top €2.6 billion (US$3 billion) in 2020, growing 12.5 percent annually each year. The list of possible 3D-printable materials has more than doubled in the last five years, which has led to a rebound in the industry’s growth potential.
While 2019 will be defined by how new technologies steadily reshape how we live and work, we must not forget the influence of existing technology like radio and their continued influence,
From smart speakers to 5G networks, and everywhere in between, accessibility to advanced technologies is quickly improving. As the barriers continue to fall, the potential for greater connectivity and further innovation will increase exponentially.
Now in its 18th year, Deloitte Global’s annual TMT Predictions provide an outlook on key trends in the technology, media, and telecommunications industry sectors worldwide. Visit Deloitte.com/predictions to learn more and connect with us on Twitter: @DeloitteTMT and #DeloittePredicts.
About Deloitte Technology, Media & Telecommunications
To ensure sustained business growth, it is critical that organisations address the increasing disruption posed by emerging technologies. Deloitte’s Technology, Media & Telecommunications (TMT) industry practice brings together thought leaders and trusted specialists to shape many of the world’s most recognised brands in these fields. Through its work, the TMT team aids clients in creating competitive advantage and helps them succeed in an increasingly digital world.
Deloitte Global’s annual TMT predictions serve as guideposts for future business strategy by providing a 1-5 year outlook on key trends in the global technology, media, and telecommunication industry sectors. The trends help identify key challenges and areas of focus for the world’s TMT brands as they navigate the impact of new technologies shaping the future of industry.
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 Based on Deloitte Global Mobile Consumer Survey – The Irish Cut (2018)
 JNLR Report for 12 months to September 2018
 Reuters Institute for the Study of Journalism- 2018 Digital Media Study