With truly wireless earphones making rapid inroads into our lifestyle and bringing about a paradigm shift in the way people listen to music or talk to someone over phone, one thing is for sure that it’s going to further bring a positive impact on the electronics industry – thanks to the increasing adoption of smartphones and other mobile devices.
Earphones have always been a phone’s best companion, and like the latter, the ear-worn devices have undergone a massive change from a wired one to wireless and now the truly wireless, often referred to as TWS (true wireless stereo). The introduction of true wireless earphones, or say earbuds has brought about a paradigm shift in the way people listen to their music or talk to someone over phone. These earbuds provide a user with a tangle-free experience, as there is no wire connecting the left and right earpieces. The earbuds are compact and can be carried around in a charging case, making them extremely portable. The styling and portability of these products have made them popular among the young folks, athletes and fitness enthusiasts.
So before moving further, let’s understand how TWS technology works. Just like traditional wireless headphones, true wireless headphones receive a Bluetooth signal from your phone via a 2.4GHz wavelength. The path of transfer renders your phone a transmitter and the earbuds receivers. Unlike typical wireless earphones – which receive the signal simultaneously since the earbuds are connected by wire – truly wireless earbuds designate one earbud as the primary receiver, and the other becomes the secondary receiver.
With such gradual modifications, the means of consumption of content has also evolved, thus redefining our listening experience with the touch of a button which has multi-functional controls nowadays. Earlier, headphones were single-sided heavy speakers which were to be held onto one ear to communicate. This has slowly evolved to the neckband design which came in the early 2000. “While headphones remain a popular category, brands also started focusing on earphones as it was portable and easy to carry, along with great sound quality,” said Kapil Gulati, Director, Consumer Segment, Sennheiser India, in a recent column/blog.
“Being truly wireless is the major factor for its growth. It’s much more convenient for your usage and movement, without the obstacles caused by the wires. All that time spent in untangling the earphone wires, before you can listen to music, is passé now. Along with that the affordability created by the new entrants is also driving the growth,” said Ajesh George, MD, RAEGR, a Bengaluru-based consumer lifestyle technology brand.
“All that time spent in untangling the earphone wires, before you can listen to music, is passé now. Along with that the affordability created by the new entrants is also driving the growth”
– Ajesh George, MD, RAEGR
Gopal Jeyaraj, Head (India & SAARC), Anker Innovations, said, “In India, the technology market has been very dynamic. Initially, when AirPods were launched, it was not very well accepted in the Indian markets. However, over a period of time, it not only became a trend but also a high utility tech accessory, even for professionals.”
Earlier, the TWS was not very advanced; having less battery, limited talk-time, less playback time. But now, the advancement in technology has introduced more charging capacity in TWS. “In fact, in one of our Soundcore TWS products we are offering 100 hours playtime. The product if charged for one time lasts for almost a week even if it is used for 6-7 hours per day. Moreover, the cost factor has also become very competitive and aggressive. The attractive price points today make the customer opt for TWS over other headphones,” said Jeyraj.
“The industry is expected to further grow in 2020 with COVID-19 setting off a trend where people working from home and connecting through voice and video calls become more appreciative of the convenience and reliability of TWS devices. The increasing audio consumption, portability and smart assistants are making TWS extremely popular among smartphone users and driving demand,” said Arijeet Talapatra, CEO, Transsion India. TECNO, a smartphone brand under Transsion, recently marked its foray into the TWS category with the launch of Hipods H2 which is priced aggressively at Rs 1,999. Similarly, Infinix, another brand of Transsion, augmented its audio portfolio with the launch of iRocker truly wireless earbuds under the brand, Snokor.
“The increasing audio consumption, portability and smart assistants are making TWS extremely popular among smartphone users and driving demand”
– Arijeet Talapatra, CEO, Transsion India
A Big Market
The trend of TWS earphones is catching up in such a manner that it has become a big market for companies – handset as well as accessories makers – to rake in moolah. Even when the entire country is struggling to be on the track in the aftermath of COVID-19 lockdown and businesses have been at an all-time low, the TWS hearables market is growing like never before. These wireless earbuds are indeed revolutionizing the entire industry. “The smartphone makers are now doing away with the 3.5 mm headphone jack to make wireless headphones more convenient and appealing to customers. People are now looking for seamless and hassle-free immersive audio experience, thereby creating a need for the technologically superior truly wireless earbuds,” said Gulati.
“The TWS earphones have seen a surge after Apple launched the AirPods and that trend has caught up in India as well. Now the sector is getting hotter with the entry of TWS models from phone makers like Oppo, Mi, Realme and OnePlus. Sony also has joined the bandwagon along with others like Sennheiser and Jabra,” said George.
According to a recent report by International Data Corporation, truly wireless stereo (TWS) accounted for 23.1% to the overall earwear category. TWS alone grew at 300.7% YoY. “The earwear category is witnessing a major shift from wired to wireless devices. The lockdown which led to growing need of working from home and also, increased the entertainment consumption, has further accelerated the shift to wireless devices,” said Anisha Dumbre, Market Analyst, Client Devices, IDC India. “These devices not only help to reduce outside noise while users are taking virtual meetings but also help them to stay connected without any wires,” Dumbre added.
IDC says that with 3 million earwear devices shipped in the first quarter of the year, the earwear category witnessed a triple-digit YoY growth in 1Q20. Boat led the segment with a 23.9% share, competing very closely with Samsung, which includes devices from Samsung, Infinity and JBL, with a 23.6% share in this category. Samsung surpassed Apple in the truly wireless stereo category with a 29.8% market share mainly because of its newly-launched Galaxy Buds Plus, Apple finished second with 15.7% market share in this category.
Thanks to the TWS segment, the global earphones market size was valued at USD 25.1 billion in 2019 and is expected to grow at a compound annual growth rate (CAGR) of 20.3% from 2020 to 2027. Rising consumer preference for enhanced audio experience, growing music industry, coupled with mobile technology and internet penetration, are some of the primary factors driving the market, says Grand View Research in a report.
Faisal Kawoosa, Founder and Chief Analyst at techARC, said, “The market is among one of the categories within accessories, which is growing exponentially across price segments. Owing to this, nearly every smartphone OEM has now launched its own TWS. Indeed, music and now calls due to work-from-home have become very important use cases of a smartphone, and TWS creates that personal space for a user even within home environment. Many of the people use living rooms and shared rooms to operate during working from home.”
“Nearly every smartphone OEM has now launched its own TWS. Indeed, music and now calls due to work-from-home have become very important use cases of a smartphone, and TWS creates that personal space for a user even within home environment”
– Faisal Kawoosa, Founder and Chief Analyst, techARC
Overall, the TWS market in India posted 656 per cent (year-on-year) growth in the second quarter of this year, becoming one of the few segments which actually grew during the pandemic, as per a report by Counterpoint Research. Realme, which entered the India TWS market in December last year, emerged as the leading brand in Q2 driven by the newly-launched Realme Buds Air Neo and Buds Q. Whereas, Xiaomi, which entered the India TWS market in Q2 2020 with the launch of two devices — Redmi Earbuds S and Mi True Wireless 2 — managed to capture the second spot. JBL remained in the third position while increasing its share to 15 per cent in Q2 2020. Launch of three more devices and strong demand for its model C100TWS drove the growth. “Entry of players like Xiaomi and Oppo, and launch of more affordable devices pushed the average selling price (ASP) to the lower side, making it possible to reach a larger section of the population,” said Research Analyst Shilpi Jain.
Considering the fact that the Indian markets largely remain untapped for TWS, the segment holds strong growth potential and also opportunities for existing and new players.
“Entry of players like Xiaomi and Oppo, and launch of more affordable devices pushed the average selling price (ASP) to the lower side, making it possible to reach a larger section of the population”
– Shilpi Jain, Analyst, Counterpoint Research
This sector is innovating regularly. On a monthly basis, new technological advancements are happening in the TWS segment. “Active Noise Cancellation introduced by Apple AirPods Pro has now made the competitors focus on this technology. Also, there are improvements happening on the chipsets, battery life and the aesthetics. The Samsung Galaxy Buds Live is a great example of creative aesthetics,” said George.
According to Grand View Research, technology developments are primarily driven by surging consumer demand for style and high-fidelity. Introduction of advanced features like active noise cancellation (ANC) and near field communication (NFC) is expected to offer a user with enhanced listening experience and fluidity in connectivity with their music devices. For instance, presence of ANC technology in earphones and headphones eliminates the background noise, thus improving sound quality. NFC establishes the connection between the wireless headphones and music device by just tapping them to each other. Such advanced features are anticipated to fuel the market growth.
Usage of earphones and headphones for fitness activities under various environmental conditions, like rain and dust, has propelled the manufacturers to add durability to their products. Several companies have manufactured their products with a certain (ingress protection) IPX rating, which is a safety rating to offer protection against dust and water. For example, IPX1 rated device is resistant to water droplets and can be dripped with water for 10 minutes. The level of protection ranges from the number 0 to 9 and increases with the highest level being IPX9, which offers protection against the spray of water from a high-pressure nozzle. Similarly, in the case of dust, the rating ranges from IP0X to IP6X, with IP6X being the highest. In some cases, the product may be resistant against both dust and water. For instance, products with an IP57 rating are dust tight and water resistant to high pressure sprays. Presence of such useful features and some significant development in product technology is expected to keep the products in demand over the next few years.
“The fact that the upcoming wireless earbuds have evolved with longer battery life, better Bluetooth compatibility, enhanced audio quality, and ANC for noise free listening- due to which this segment is increasingly making it one of the favourite gadget categories amongst consumers. People are willing to pay more for a superior/premium sound experience,” said Gulati.
With TWS earphones making rapid inroads into our today’s lifestyle driven digitally with superior audio quality, long battery, sweat-proof, customised fitting for a more comfortable experience; one thing is for sure that it’s going to further bring a positive impact on the industry – thanks to the increasing popularity and adoption of smartphones and other mobile devices.
Apple losing ground in true wireless earphones market to Chinese rivals
Despite AirPods sales growth, Apple’s grip on the true wireless earphones market is slipping and now holds just 35 per cent of the fast-growing segment market, as per Q2 2020 research data by Counterpoint. More affordable alternatives from Chinese rivals have eaten into Apple’s share in a fast growing TWS earphones market, while Samsung is also expected to provide stiff competition to the company in the latter half of the year. Even in this scenario, the market tracker predicts Apple is likely to boost sales of its AirPods TWS earphones this year by one-third.
As per a Bloomberg report citing data from Counterpoint Research’s Q2 2020 figures, Apple at the end of the last quarter had just over a third of the market at 35 per cent. It is followed by Xiaomi at 10 per cent and Samsung at 6 per cent. Jabra and JBL had a 3 per cent share each, with other players making up 43 per cent of the market, Counterpoint said. Established audio brands like Sennheiser, Beyerdynamic and Audio-Technica barely registered in the data, each holding 0.3 per cent share or less and competing in the premium market.
Apple accounted for nearly half of all sales in the truly wireless earphones category (TWS) in 2019, and is expected to sell 82 million units this year, up from 61 million the previous year, as per the research data. However, rival companies offering alternatives at lower prices have emerged, eating into Apple’s market share. “The low-to-mid end segment including Chinese brands and US makers such as JLab is taking away share from the premium market,” Counterpoint analyst Liz Lee is quoted by Bloomberg as saying. Also notably, although Apple came to define the TWS market, many of the iPhone-related AirPods advantages are lost to Android users. “We believe that Samsung can attract more users, especially Android phone users, if it provides a wider selection of TWS devices from mid to high-end with at least two or three variations,” Lee added.