Chinese Companies Erode Apple's Lead in TWS Market – Xiaomi Ranks Second in 2Q 2020
COVID-19 and China
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The release of Apple's (AAPL:NASDAQ) Airpods at the end of 2016, along with the headphone jack-free iPhone, defined the new electronics category – true wireless stereos. As the Airpods were the first, and the patents around realizing a 'no time lag' in data transmission between two points of Bluetooth connection are kept secret by Apple, Apple enjoyed a complete lead in this category for the first two to three years. However, as related technology breakthroughs have been made by both Chinese and American electronics companies, TWS products with lower prices and similar functions with Airpods have been invented and taken away customers from Apple.

As Counterpoint Research revealed, back in 2019, Apple's Airpods took approximately 60% of the global market shipments. However, as the technologies in terms of simultaneous voice transmission and the cost reduction of the NOR flash chipset spread, Apple has started to lose advantages in the market. During the second quarter of 2020, though Apple's Airpods still ranked the first in the market with 35% of the total, the company's leadership was threatened by the Chinese smartphones and IoT products vendor Xiaomi (01810:HK) at 10% and the Korean company Samsung (005930:KR) at 6%. As the wireless Bluetooth earbuds belong to the phone accessories, the top smartphone vendors have the inherent advantages in terms of user base.

Editor: Luke Sheehan

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