Australia’s smart home market set to crack $2.5B, driven by AI, energy savings and security

March 20, 2024

Despite recent economic headwinds, Australians still interested in smart home tech with 7.6 million households now having at least one smart home product

SYDNEY, AUSTRALIA – Despite recent economic headwinds, Australians still interested in smart home technologies with 7.6 million households now having adopted at least one smart home product, with nearly 24 connected devices per home as of 2023, according to new research from the Australian emerging technology analyst firm, Telsyte.

The Telsyte Australian Smart Home Market Study 2023 found that Australia’s smart home market is set to crack $2.5 billion in revenue, driven by demand for energy efficiency, security, price increases, and the anticipation of the smart home concept greatly benefit from the technological advancements in generative AI.

Smart homes becoming mainstream even with the cost

As more electrical devices arrive on the market with computer “smarts”, Australian consumers now have more choice to make their home smart, but must continue to balance the opportunity with the costs.

Almost half (48%) of invested adopters (consumers adopted 5 or more types of smart home devices) say the current smart home offerings are not yet ‘smart’ enough, according to the study.

Telsyte’s research found in 2023 cost of living pressures outweighed the benefits of a smarter home with over half (59%) under increasing financial pressure and less looking to adopt energy optimising solution for their home to combat rising energy costs.

However, the overall trend remains clear: Cost of living pressures will not stop the transition to smarter homes and nearly a third of households now have five or more smart devices.

Robots, EVs and renewables ramp up the smart home

Smart appliance vendors are now committed to enabling ‘connected’ living with aircon, washing machines and fridges taking the lead among appliances consumers see as important to be ‘smart’.

The study found nearly one in five (18%) households have a vacuum robot with more general-purpose robots on the way. iRobot is still the leading brand of vacuum robot despite increased competition.

Surging energy prices continues to add pressure to household budgets with 74 per cent of Australians seeing their electricity bills increase in 2023; however, a sustainable home is still important to Australians during turbulent economic times.

In addition to cost savings and better energy efficiency, the study found 28 per cent of households want to reduce environmental impact with smart energy solutions and more are considering smart batteries for a complete solar solution.

More than half (61%) of solar owners have expressed interested in joining a Virtual Power Plan (VPP) program to help the environment and support their communities.

In the garage, high fuel prices tipping over new car buyers to EVs. Tesla still leads in sales, but EV models priced closely aligned to buyers’ expectations are proven popular.

Telsyte expects demand for home EV chargers set to rise with continued shortages in public spaces.

In-home AI begins to take hold

The past 12 months has seen a lot of hype around generative AI and services like ChatGPT, and Telsyte found device product marketing is shifting from ‘connected home’ to AI-enabled smart living.

“Australians will increasingly look for AI-powered smart living solutions that offer convenience, personalisation, and enhanced functionality,” Telsyte Managing Director, Foad Fadaghi, says.

New Gen AI voice assistants bring superior cognitive understanding of user intentions with advanced natural language processing, and 60 per cent of consumers believe AI can manage a smart home better than themselves. In addition, 43 per cent of people are keen on a smart home with advanced AI capabilities that enable seamless natural language communication and automate complex tasks.

The study found there were an average of 23.8 connected devices in the home in 2023 with 16.1 non-smart devices, 7.1 smart home devices and 0.5 provisioning devices (e.g. modems).

The average number of Internet-connected devices in the home is expected to grow by nearly 10 in the next 4 years and the average number of smart home devices set to grow by nearly half by 2027, equivalent to more than 353 million Internet-connected devices in total.

Telsyte forecasts the smart home market to be worth over $5 billion by 2027 with high value smart home products such as smart batteries, smart appliances and services to drive smart home market value. Smart appliances could make up around a third of all appliance revenue by 2027.

While smart speaker adoption is stagnating, AI-powered experiences are poised to set off the next adoption wave. Google is adding generative AI capability to its Google Nest smart speakers, which are already the main smart speaker for over half of user households.

How will all these AI-powered, connected devices interact? The emerging Matter standard poised to help unify disparate ecosystem.

A joint effort of more than 120 companies, including Google, Apple, Amazon, and Samsung, Matter is a smart home protocol aimed at unifying industry standards and allowing devices with different communication protocols across multiple platforms to communicate with each other.

Smart spaces hot with hybrid work here to stay

Being able to work from home or the office thanks to the pandemic has had a measurable impact on the spaces Australians are looking to improve, with the living room and study now the top smart spaces.

The lounge room, study and front entrance are the spaces where internet-connected devices were installed most in 2023, with the gaming room rising fast.

The study found more than a million (1.2M or 12%) Australian homes now have a dedicated workspace and another 500,000 (5%) households are interested in setting up a space dedicated to their hobbies and DIY.

Connectivity and convenience have joined security and energy efficiency as the top reasons for improving spaces in 2023 and Telsyte forecasts more investments will be made making the home office smarter.

Security and home care putting smart devices to work

In a positive step for the smart home trend, smart security surveillance and smart home care are putting smart devices to work helping with disability and aged care, and not just entertaining people.

Telsyte found 1.6 million (16%) households claim they have seniors or members with a disability that require special assistance or care, and among those households 1 in 3 (32%) are seeking additional help looking after these household members.

A further 37 per cent believe they will significantly benefit from the support provided by voice commands and more intelligent smart assistants.

This signals a new opportunity to implement assistive smart home tech in NDIS households.

The study also found 31 per cent of households have security surveillance systems, and self-monitored online security systems are on the rise with about half of the installed base.

Smart video cameras remained popular in 2023 with increased availability of AI features and more affordable products with the market now worth over $330 million.

Telsyte also found more people are acquiring security cameras from hardware stores and electricians, and more are relying on professional installation for smart security devices leading to boost in mixed mode installations.

Subscriptions are gaining some appeal as appliances get smarter

With most appliance vendors committed to enabling ‘connected’ living and aircon, washing machines and fridges are taking the lead among appliances consumers see as important to be ‘smart’. Smart lightbulb adoption has slowed during the economic downturn, but is expected to grow with more competitively priced units.

To pay for it all, the study found Australians remain moderately interested (16%) in hardware subscription services, but more potential adopters are interested in this model.

Those interested are willing to pay from $26 to $44 per month for each service. Home automation services, utility and insurance providers increasingly considered for subscription services.

The taxonomy of Telsyte's Australian Smart Home Market Study 2023:

IoT@Home segments covered:

For further information on the study or media enquiries contact:

Foad Fadaghi
Managing Director
Tel: 1800 313 142
Email: ffadaghi@telsyte.com.au

Alvin Lee
Senior Analyst
Tel: 1800 313 142
Email: alee@telsyte.com.au

The Telsyte Australian Smart Home Market Study 2023 is a comprehensive study which provides subscribers with:

Market sizing and forecasts of the Australian smart home market by detailed segments including services and installation revenues
Insights into consumer attitudes and technology adoption trends
Analysis of vendor strategies and key growth segments
Smart home user profiles, including adopters, those on the verge of adopting and those not yet to be interested.
Analysis of the smart home ecosystems
Analysis of retail and online channels and their importance to smart home products
Insights into where consumers begin with smart home journey and key market drivers expected to drive rapid adoption in different segments.

In preparing this study, Telsyte used:

An online survey conducted in August 2023 with a representative sample of 1,109 respondents, 16 years and older.
An online survey conducted in December 2022 with a representative sample of 1,036 respondents, 16 years and older.
Interviews conducted with executives from service providers, network operators, manufacturers, retailers, financial analysts and channel partners.
Financial reports released by service providers and manufacturers.
On-going monitoring of local and global market and vendor trends.

Editor’s note:

Telsyte measures sales of devices (“sell out”), not shipments or sales to retailers or carriers (sometimes called “sell-in”). Telsyte believes this is a more accurate measure of performance of products in a marketplace. Telsyte does not rely on disclosure from vendors or general assumptions made for large multinational companies that do not release local market data. Telsyte uses a comprehensive methodology that includes surveys of consumers, discussions with vendors, carriers and their partners, retailers, and financial analysts. In addition, public financial results from manufacturers and carriers are used. Telsyte tests a wide range of products in real life usage scenarios and conducts satisfaction and repeat purchase surveys with large and representative samples of Australian smart device users. Telsyte is a pioneer in measuring and reporting smartphone sales in Australia and has been providing insights on mobile technologies since 2006.

About Telsyte

Telsyte is Australia’s leading emerging technology analyst firm. Telsyte analysts deliver market research, insights and advisory into enterprise and consumer technologies. Telsyte is an independent business unit of DXC Technology. For more information visit www.telsyte.com.au

The material in this article is copyright protected and not intended to be altered, copied, distributed or used for any commercial or non-commercial purpose, except for news reporting, comment, criticism, teaching and scholarship.

Generative AI fuels Australia's booming IaaS market

March 5, 2024

Hyperscalers continue to dominate

SYDNEY, AUSTRALIA – Cloud applications and generative AI are the key drivers of Australia's soaring Infrastructure as a Service (IaaS) market, a new report from Telsyte, an Australian emerging technology analyst firm, reveals.

The report, titled Telsyte Australian Hyperscale Cloud Market Study 2024, shows that Australian organisations spent $4.4 billion on cloud infrastructure in 2023, a remarkable 25 per cent increase from the previous year.

The report also highlights the continued dominance of hyperscaler cloud providers, which accounted for an estimated 90 per cent of the IaaS market in 2023.

Telsyte predicts that the total IaaS market in Australia will reach $8B in revenue by 2027, propelled by growing cloud spending. Nearly half (40%) of Australian organisations plan to boost their cloud spending by 20 to 70 per cent in 2024.

Microsoft, through its partnership with OpenAI, is the leading Generation AI technology provider in Australia, with a solid presence in cloud services and productivity tools.

Generative AI, which can create novel content such as text, images, code, and music, is mainly delivered as a cloud service and fits well with most cloud applications. Natural language processing, code generation and reviews, and other use cases can be powered by cloud services.

Telsyte's research also shows that improved data analysis and insights are the top benefits that organisations expect from Gen AI.

In 2023, more than half (55%) of Australian organisations had already tried or implemented some form of Generative AI.

Cloud adoption high, but not yet mature

Cloud adoption and spending are high, but Australian IT leaders still face security and governance issues.

The study finds that cloud demand is high, with three out of four organisations considering private and public options, and only one in ten using public cloud services for less than two years.

Telsyte's cloud maturity index indicates that most of the market (71%) is shifting to more production workloads in the cloud, following the initial adoption phase.

A key finding of the study is that business units are now pushing for cloud adoption for their workloads. This is the main driver of cloud adoption, as business units do not want to wait for in-house IT to provide the infrastructure they need.

Cloud benefits such as access to new technologies and faster time to market are among the top five reasons for adoption.

Cloud challenges persist

Cloud is bringing many operational advantages to Australian organisations, but Telsyte research finds that almost all (97%) have at least one challenge with cloud.

The biggest challenges are "shadow" cloud, where business units buy cloud services without IT oversight; security; cost; and lock-in.

There is an opportunity for cloud consolidation, as two-thirds of Australian organisations use two to three different clouds, and a high 27 per cent use four to seven.

"Australian organisations have been early adopters of cloud, but in 2024 we expect to see more improvements in how cloud is used, with more maturity, more app development, and more focus on consolidation," says Telsyte Managing Director, Foad Fadaghi.

Cloud native apps gaining traction

The study shows that virtual servers are the most common IaaS application, but new areas such as serverless compute and storage are gaining popularity.

Infrastructure-as-Code (IaC), or deploying cloud infrastructure with code-level consistency and automation, is attracting high interest.

"The public clouds have enabled a new era of service automation for Australian enterprises, and there is a range of tools in use or being tested for Infrastructure-as-Code," Fadaghi says.

IaC is expected to be crucial for Generative AI deployments.

Hybrid cloud here to stay, skills needed

Telsyte's hybrid cloud research has been tracking adoption for eight years and shows that hybrid cloud is now mainstream in Australia, with eight in 10 organisations either testing or using it. Only 8 per cent have no plans for hybrid.

The preferred hybrid architecture is mainly cloud to on-premises, with cloud "bursting" also in use.

Telsyte's study also finds that there is a skills gap in Australia, with cloud networking skills in high demand and traditional database and security skills lacking in cloud.

For further information on the study or media enquiries contact:

Alvin Lee
Senior Analyst
Tel: 1800 313 142
Email: alee@telsyte.com.au

Foad Fadaghi
Managing Director
Tel: 1800 313 142
Email: ffadaghi@telsyte.com.au

The Telsyte Australian Hyperscale Cloud Market Study 2024 is a comprehensive study which provides subscribers with:

Market sizing and forecasts of the Australian cloud infrastructure services market
Analysis of market share and hyperscale performance
End-user trends in cloud computing
Strategic analysis of market opportunities for cloud infrastructure and MSPs

Telsyte’s study also includes profiles of the leading cloud vendors

Hyperscale profile: Amazon Web Services
Hyperscale profile: Google Cloud
Hyperscale profile: Microsoft Azure
Hyperscale profile: IBM Cloud
Hyperscale profile: Alibaba Cloud
Hyperscale profile: Oracle
Where VMware fits into the hyperscale clouds
Tier-2 clouds challenge hyperscalers: Telsyte forecast the rise of tier-2 clouds 3+ years ago. They offer low-cost scalability and growing range of hyperscaler features

In preparing this study, Telsyte used:

An online survey of 200 IT decision makers across Australian organisations with 20 or more employees. More than half of respondents were from large organisations (>200 employees)
Annual reports released by market participants
Interviews and discussions with cloud providers, third party service providers and carriers
On-going monitoring of local and global market trends

About Telsyte

Australia’s subscription entertainment market growth eases but remains vital

August 28, 2023

Netflix sees first decline as competition heats up

Half of Australians deem on-demand services essential for entertainment

SYDNEY, AUSTRALIA – The Australian subscription entertainment market, which includes video, music and gaming services, saw a slowdown in annual growth in the past 12 months due to the rising cost of living pressures, according to a new study from leading Australian emerging technology analyst firm Telsyte.

The Telsyte Australian Subscription Entertainment Study 2023 found that the total number of subscription services in Australia increased by 3 per cent to 49.9 million in June 2023. This growth rate is lower than the double-digit increase observed in the previous year. However, the report also revealed that entertainment subscription services remain essential to Australians, with half of them saying that on-demand services are vital to meeting their entertainment needs.

Video competition heats up, Netflix numbers fall

The SVOD segment continued to be the largest and most competitive in the subscription entertainment market, with the number of services reaching 24.6 million in June 2023, up by 5 per cent year-on-year. The average number of SVOD subscriptions per household rose to 3.4, with 39 per cent of subscribing households having three or more services.

The report found that Netflix, the market leader, experienced its first decline in subscriber numbers in Australia as of June 2023, while others gained ground. The report attributed the decline to the backlash to Netflix's crackdown on account sharing and its introduction of an ad-supported plan, which faced user resistance.

Despite the dip, the study found Netflix (6.1 million) remained the top SVOD service at the end of June 23, followed by Amazon Prime Video (4.5 million), Disney+ (3.1 million), Stan (2.6 million), Binge (1.5 million), Paramount+ (1.5 million), Kayo Sports (1.4 million) and Apple TV+ (1.0 million).

While there has been a slowdown in growth and increased competition, the report showed that SVOD consumption remained strong with over half (55%) of Australians continue to discover new content through their services.

The average total weekly video entertainment consumption reduced by 9 per cent year-on-year to 45 hours from its high in 2022, but consumption of SVOD was one of the only two categories that saw an increase across 9 video categories measured by Telsyte.

However, nearly half (48%) of subscribers claim they are more likely to switch between different services to save money than previously, and only 27 per cent find it difficult to ‘unsubscribe’ their main services even when they don’t use them often.

“Profits, partnerships, and more aggressive behaviour. There’s going to be increasing competition to win people over from other platforms,” Telsyte Managing Director, Foad Fadaghi, says.

Telsyte estimates the total number of SVOD subscriptions could reach over 30 million by June 2027, driven by a new content boom; growth in multiple subscriptions; new market entrants and more ad-supported plans across services.

SVOD market revenue is estimated at $2.7Bn for FY2023, a 14 per cent year-on-year increase driven by subscription cost rises and an increase in service adoption.

The study found that paid SVOD services rank 6th (34%) among areas where consumers would consider reducing spending if their household budget becomes tight (with the top 3 being dining out & takeaway, clothing & accessories, and holiday-related expenses). Notably, only 19 per cent of respondents said they had cut spending on paid SVOD services in the past 12 months, coming in at 10th.

“Paid SVOD services as a category exhibits strong retention and near recession-proof characteristics, as other significant spending areas become household budgeting priorities,” says Fadaghi.

Telsyte found over half (51%) of SVOD users are expecting the price of streaming video services to increase this year and have adjusted their SVOD budget accordingly. Among those willing to pay for streaming video services, the average monthly budget has increased by 7 per cent from a year ago to over $36. The increase is similarly in line with the average CPI inflation recorded in 2023.

Crackdown on account sharing faces user resistance

This year saw the beginning of highly publicised crackdowns on account sharing by streaming service providers, making it harder for people to pay for one account and share access to it between family and friends.

Australians are used to sharing their SVOD services, with the study suggesting that 1 in 3 (32%) SVOD subscribers share their services. Among those sharing services, half (50%) share with others who reside in different households.

The majority (>80%) intend to share services for as long as they can, and the top reason for sharing is to save money (55%). However, 48 per cent of Australians claim they will stop sharing altogether if they are required to pay to share these services.

Around 7 per cent of those who have subscribed to Netflix in the last 12 months ended up cancelling Netflix due to the new rules imposed around sharing with others outside the household. At the time of the survey, the uptake of Netflix’s new extra member plan (as of June 23) had yet to exceed the number of cancellations suggested by the survey findings.

While limiting the shareability outside of account owners’ households might provide additional revenue for service providers, Telsyte sees it as a risk for some providers and a reason consumers might explore competing services.

Free and ad-supported services keep people entertained

Paid-for SVOD is here to stay, but Telsyte’s research also found more than 60 per cent of non-SVOD users believe there is enough good quality video content from free sources to keep them entertained and not have to pay for any subscriptions.

Broadcasting Video on Demand services (BVOD, including 7Plus, 9Now, 10Play, ABC iView and SBS On Demand) remained popular and most platforms had more than 10 million viewers during FY2023.

Additionally, nearly 5 million Australians claim they have used free and ad-supported streaming TV (FAST) services, or services that offer FAST channels in the last 12 months.

Australians now have the option of more affordable ad-supported SVOD plans since Netflix and Binge launched their ad-supported options during FY2023. According to Telsyte’s research, there are more than a million non-sport SVOD subscriptions subsidised by advertisements as of June 2023.

The study found that 36 per cent of SVOD users are interested in more affordable ad-supported service plans. Telsyte believes more services could introduce an ad-supported tier to attract a new audience and ad-supported plans could potentially lift the average number of subscriptions per household closer to 4 (currently 3.4) by 2027.

Support for local content remains strong

The study highlighted significant interest in Australian content on SVOD platforms in the past year with two in three (66%) Australians claiming they have watched locally-developed content on SVOD platforms in the last 12 months, and nearly 60 per cent saying they want to see more.

More than half of SVOD watchers also believe it is important to have content that has Australian stories, voices, culture and values in their services. Additionally, a third (34%) of Australians say they are more likely to subscribe to an SVOD service that continues to support and invest in local film and TV production.

Australians are also voicing their concerns over the recent debate about using generative AI to produce video content, with half (50%) not believing generative AI can replace human screenwriters in creating captivating, distinct storylines that capture their interest. Additionally, 60 per cent say viewers should be made aware of the source of material produced using generative AI in videos, TV shows and films.

More than 3 in 5 (62%) also believe production companies should compensate actors and celebrities (and seek consent) if AI-generated digital replicas are used for content production. Overall, Australians show strong support for the local production industry, with 57 per cent advocating for the regulation of generative AI-produced source material in the video and film sector.

Smaller gaming budgets impacting subscription growth

Australians had taken up 8.5 million games-related subscriptions at the end of June 2023, a 2 per cent increase from a year ago.

Telsyte believes the slowdown is due to consumers having a tighter budget for video games, with a slowdown witnessed across content, services and consoles. The annual average consumer budget for video games has also been reduced by 11 per cent from a year ago.

Microsoft’s Xbox Game Pass remains the leader across all types of games-related subscriptions that Telsyte measures as consumers continue to gravitate towards the all-you-can-play subscription model. The Nintendo Switch Online service saw stronger growth, benefiting from the popular Nintendo Switch consoles among younger Australians.

Interest in cloud gaming remains high with the adoption of cloud gaming outpacing the slowing video game subscription market. Telsyte estimates the number of gamers adopting cloud gaming services such as Microsoft’s xCloud and GeForce Now is approaching a million, an increase of 73 per cent from a year ago. Cloud gaming remains highly sought after amongst hardcore gamers who play video games for more than 3 hours a day.

Music subscriptions maintain modest growth

Streaming music remains popular with the adoption of subscriptions reaching 16.6 million at the end of June 2023, an increase of 5 per cent from a year ago.

The top 3 streaming music service providers in Australia remained Spotify, Google (incl. YouTube Music and YouTube Premium) and Apple Music. More listeners are using Amazon Music as part of the Amazon Prime subscription.

In addition to music, the study found audiobook subscriptions continue to grow steadily, with close to 1.5 million users in June 2023, up from 1.3 million in the prior year.

For further information on the study or media enquiries contact:

Foad Fadaghi
Managing Director
Tel: 1800 313 142
Email: ffadaghi@telsyte.com.au

Alvin Lee
Senior Analyst
Tel: 1800 313 142
Email: alee@telsyte.com.au

The Telsyte Australian Subscription Entertainment Study 2023 is a comprehensive study that provides subscribers with:

Market sizing and forecasts of the Australian entertainment subscriptions market, including video, music, and games
Insights into consumer attitudes and technology adoption trends
Uptake, intention, and detailed analysis of
- Video services including: SVOD, pay TV and BVOD services
- Streaming music services
- Games-related subscription services
Services consumption preference including devices, fixed and mobile service.
Insights into the future of entertainment subscription services in Australia.

In preparing this study, Telsyte used:

An online survey conducted in August 2023 with a representative sample of 1,109 respondents, 16 years and older.
An online survey conducted in December 2022 with a representative sample of 1,036 respondents, 16 years and older.
Interviews conducted with executives from SVOD, Pay TV and video game service providers, content providers, funding agencies and hardware manufacturers.
Financial reports released by service providers and media companies.
On-going monitoring of local and global market trends.

Editor’s note:

Telsyte measures the hours that consumers spend on consuming all types of video content. Examples include FTA TV, SVOD, social media videos, BVOD etc.
Telsyte actively monitors the SVOD services market, including over 40 SVOD services. Other examples include Britbox, CrunchyRoll, Foxtel Now, Hayu, Optus Sport etc.
The measure is the number of subscriptions at the end of June 2023 (snapshot), not usage/utilisation. Content releases will influence the number of subscriptions when measured at different points in time.
Telsyte measures Amazon Prime Video as a subset of Amazon Prime – with measured subscribers self-reporting their use of the video service.
FAST channels are curated scheduled channels that feature specific programs, genres or themes and offer an improved viewing experience of linear TV channels (e.g., a channel that is dedicated to ‘MasterChef’ or ‘shows from the 70s’). Examples of services that offer FAST channels include Samsung TV Plus, Plex, 7Plus, 10Play).

About Telsyte

Extended Reality (xR) market poised for growth

May 23, 2023

Apple’s headset could bring ‘X-factor’ for xR adoption

SYDNEY, AUSTRALIA – The launch of an Apple headset and the development of Extended Reality (xR) technology could boost the uptake of head-wearable devices in Australia, as consumers seek new ways to enhance their lifestyles, health and entertainment, according to new research from Telsyte, an Australian emerging technology analyst firm.

The Telsyte Australian Smartphone & Wearable Devices Market Study 2023 found that smart wearables grew in popularity with smart wrist and ear devices growing in adoption, with 36 per cent and 29 per cent population penetration respectively.

However, Telsyte expects head devices (headsets and glasses) to gain momentum with new powerful xR chipsets, partnerships such as the Qualcomm, Google and Samsung alliance, new and improved applications (for productivity, fitness and education) and highly anticipated products and games in 2023.

The xR market has been driven largely by enterprises, gamers and tech enthusiasts so far, but Telsyte’s consumer survey shows that more than one in four (27%) Australians are enthusiastic about its possibilities. This is three times that amount of individuals that are current adopters, about 1.5 million (6%) Australians at the end of 2022, a small rise of 4 per cent rise over the previous year.

Those interested in xR are drawn to various applications, especially entertainment, including games (38%), virtual tours (33%) and videos (31%). Sports, health and fitness applications also appeal to more than 1 in 5 (22%) consumers.

Manufactures have for years grappled with the balance between weight, tethering, comfort, and safety. The survey also showed that the majority (91%) of Australians prefer a wireless headset that works without cables. Telsyte believes battery life limitations are still a major impediment to smart headset adoption, especially for longer usage scenarios such as gaming and long-format video. This echoes the sentiment for wrist wearables, where battery life has been rated the most important selection criterion in the last two years.

The wearability of xR devices is another key factor vendors have been focusing on, with better weight and design optimisation. When selecting an xR headset, survey respondents say comfort and wearability measures are important to them, such as fitting of the headset (62%), weight (60%) and the ability to adjust lenses for their prescriptions (50%).

In addition to a “preference for real-world interactions”, the research found that those who are not interested in xR technology cite a lack of games and apps (24%), and the lack of interest among their friends and families (19%).

Apple could be a game-changer for xR adoption with a loyal user base and hungry developer ecosystem

Telsyte believes the potential release of Apple’s xR headset could accelerate the adoption of head wearables, alongside other new xR headsets, such as HTC’s VIVE XR Elite and Meta’s Quest Pro.

More than half (57%) of Australians aged 16 and older are already familiar with the Apple ecosystem and use different Apple devices and services that could complement and enhance the overall experience of an Apple headset.

Apple has a proven track record of attracting app developers and introducing successful new platforms. Telsyte’s latest measure found 37 per cent of Australian Apple users are considered loyal (using five or more different Apple products and services), up from 20 per cent two years ago.

Telsyte believes that this loyal base, which tends to buy more Apple devices and services, will be the early supporters of Apple’s ambitions in immersive technologies.

Apple is also well positioned to attract app developers to any new device category. Telsyte estimates that Apple’s App Store already has more than 140,000 AR apps for its iPhones and iPads, which could work with a xR headset at launch or soon after.

Those keen on xR are willing to pay an average of $733 for a headset, with 20 per cent ready to pay over $1,000. However, the Apple headset is expected to be significantly more expensive and designed initially for developers.

If Apple only releases a developer headset model in 2023, Telsyte estimates that it could sell between 10,000 and 40,000 units in Australia in the first year, depending on availability, price and the appeal to new enthusiasts. Telsyte expects Apple to follow up with a more affordable version, suited to smaller budgets as early as 2024, which could take off.

Telsyte forecasts the number of Australians using an xR headset could more than double to 3.3 million (12%) by 2027 based on scenario analysis.

“Introducing a new wearable device platform in 2023 would help energise Apple’s loyal developers,” says Foad Fadaghi, Principal Analyst and Managing Director at Telsyte.

“The key factor to Apple’s success or failure in xR will be third-party developers and application monetisation” Fadaghi says.

Extended Reality - xR is the collective term used to describe various immersive technologies including virtual reality (VR), augmented reality (AR), and mixed reality (MR).

For further information on the study or media enquiries contact:

Foad Fadaghi
Managing Director
Tel: 1800 313 142
Email: ffadaghi@telsyte.com.au

Alvin Lee
Senior Analyst
Tel: 1800 313 142
Email: alee@telsyte.com.au

The Telsyte Australian Smartphone & Wearable Devices Market Study 2023 is a comprehensive study that provides subscribers with:

Smartphone market sizing estimates, platform and vendor market shares and forecasts
Smart wrist-based wearables market sizing estimates, platform and vendor market shares and forecasts
Smart hearables market sizing estimates, platform and vendor market shares and forecasts
xR headset market sizing estimates and forecasts
End user trends across devices, application usage, platforms and operators
Purchase intentions and acquisition channels
Strategic analysis of recent market trends and developments

Telsyte measures smart wearable devices in the Telsyte Australian Smartphone & Wearable Devices Market Study 2023 as computing accessories:

Smart wrist wearables: worn on a user’s wrist typically paired and controlled via a smartphone. Examples includes products from Apple, Asus, Fitbit, Fossil, Garmin, Huawei, iFit, Misfit, Oppo, Samsung, Skagen, SPACETALK, TomTom, Withings and others.

Smart hearables: smart earbuds and headphones that support digital assistants and are typically paired with a smartphone. Examples include Apple Airpods, Samsung Galaxy Buds, Microsoft Surface Headphone and Google Pixel Buds.
xR headsets: VR, AR or MR headsets such as HTC Vive XR Elite, Meta Quest Pro, Microsoft Hololens, Pico 4, Sony PlayStation VR 2 and Steam Valve Index.

In preparing this study, Telsyte used:

Telsyte’s annual Digital Consumer survey conducted during January 2023 with a representative sample of 1,036 respondents, 16 years and older.
Interviews conducted with executives from service providers, network operators, manufacturers, retailers, financial analysts and channel partners.
Financial reports released by service providers, manufacturers and retailers.
Ongoing monitoring of local and global market and vendor trends.
Analyst reviews of leading smartphone and wearable devices.

Editor’s note:

Telsyte currently covers head wearables from HP, HTC, Lenovo, Magic Leap, Meta (Oculus), Microsoft, Pico, Sony, Vajor, Valve and others.

About Telsyte

Generative AI set to change the way Australians live and work

March 28, 2023

One million Australians were already using ChatGPT in January 2023

SYDNEY, AUSTRALIA – Australians are showing strong interest and rapidly adopting new Generative AI applications such as Open AI’s ChatGPT, according to new research from the Australian emerging technology analyst firm, Telsyte.

One in five Australians aged 16 and older were already aware of ChatGPT, and one million Australians were already using it according to a survey conducted by Telsyte in mid-January 2023, just a month and a half since the release of ChatGPT.

The study also found that one in three (34%) Australians is already interested in using Generative AI chatbots like ChatGPT for various tasks such as language translation (44%), brainstorming ideas (34%), summarising long documents (33%), and helping with research (27%). The intention rises to 49 per cent among young Australians aged 18 to 34s.

With many learning and discovering the potential of Generative AI, the research also found that 33 per cent of the Australian workforce interested in the technology intends to use it for work.

However, the study also reveals some challenges and risks associated with Generative AI. Nearly half (49%) of Australians anticipate significant changes to the workforce and job requirements in the future due to the growing prevalence of AI-based machines and software.

Only 29 per cent of the current workforce is willing to train machines or software to take over part of their own work, as well as part of someone else’s work (29%).

A workforce that could look very different in 10 years’ time because of AI

The Australian workforce is preparing for a future workplace that might look very different in a decade. In fact, 35 per cent of workers already expect that machines, AI, or robots could perform their roles in the future.

Of those who think machines could do their roles, 42 per cent think part of their roles will be replaced in five years, while a staggering 71 per cent think this will happen in 10 years.

When asked about the possibility of their roles being fully taken over by machines or AI, 30 per cent of the workforce think this could happen in a decade. This figure rises to 57 per cent when the timeframe is extended to 20 years.

Overall, almost three-quarters (73%) of Australians anticipate future jobs will be affected by Generative AI. The top perceived roles include customer services (58%), IT services (49%) accounting services (40%), tourism (39%) and graphic design (36%).

“The Australian workforce want to reduce the workload, but are wary AI might replace them”, says Foad Fadaghi, Principal Analyst and Managing Director at Telsyte.

“Generative AI has the potential to transform many industries and sectors, but it also poses some ethical and social implications that need to be carefully considered and addressed,” says Foad Fadaghi.

Incoming AI-as-a-Service

As generative AI models and APIs become more accessible and versatile, Telsyte anticipates that more paid AI assistance services like ChatGPT Plus will emerge in 2023.

The study revealed that 9 per cent of Australians would pay for AI assistance subscriptions to assist them with their daily tasks and queries, especially those aged 25 to 34s (15%) and those working in the professional (16%) and education (16%) sectors.

On average, those who would pay for AI subscriptions are willing to spend around just under $10 per month. However, 37 per cent of respondents would pay over $10 per month, suggesting a potential market for prosumer applications.

For further information on the study or media enquiries contact:

Foad Fadaghi
Managing Director
Tel: 1800 313 142
Email: ffadaghi@telsyte.com.au

Alvin Lee
Senior Analyst
Tel: 1800 313 142
Email: alee@telsyte.com.au

The Telsyte Australian Digital Consumer Study 2023 is a comprehensive study that provides subscribers with analyst content and services covering:

Key technology, services and lifestyle trends
Adoption and 4-year forecast of personal technologies (e.g. smartphones, smartwatches, tablets, 2-in-1s, computers, XR headsets, etc)
Adoption and 4-year forecast of household technologies (e.g., smart speakers, smart TVs, gaming consoles, Chromecast, Amazon Fire TV, Apple TV and other set-top boxes, etc)
Generative AI and other AI/automation applications
Post-PC device preferences and intentions
Wearable technology preferences and intentions
NBN, 5G and broadband
Mobile services
Digital video, Pay TV, Streaming video, television (including broadcast video on demand)
Social media
Technology, social and online apps adoption amongst children under 18s
Digital services and gig economy
Digital payments, banking and eCommerce trends
Interactive games and cloud gaming
Cybersecurity, privacy and consumer cloud
Attitudes to lifestyle and technology

In preparing this study, Telsyte used:

Telsyte’s annual Digital Consumer survey conducted during January 2023 with a representative sample of 1,036 respondents, 16 years and older.
Interviews with executives from service providers, network operators, manufacturers, retailers, financial analysts and channel partners.
Financial reports released by service providers, manufacturers and retailers.
On-going monitoring of local and global market and vendor trends.

About Telsyte