The global home theatre market size was valued at USD 7.7 billion in 2018. An increasing number of smart homes that are equipped with connected communication devices is driving the market for home theatre. Manufacturers have been introducing products, which are compatible with the communication devices of the smart home, which is driving the demand for home theatre. For instance, the latest home theater systems are equipped with voice assistance devices such as Alexa or Echo.
The ability to stream audio content wirelessly has been boosting the industry growth across the globe as consumers have been adopting entertainment devices with Bluetooth and Wi-Fi connectivity. The latest audio systems including HTIB and soundbars are generally equipped with Wi-Fi and Bluetooth connectivity. Therefore, the product can be connected with portable devices including smartphones, laptops, and tablets effortlessly. This connectivity feature of the home theatre systems has been attracting millennial consumers group, who are adopting portable devices rapidly. Additionally, increasing demand for Blu-Ray’s high-definition (HD) playback system has widened the scope for the producers. Key producers of this industry including Bose Corporation and LG Electronics Inc. are introducing new features to enhance the consumer experience, thereby driving the demand for home theatre.
Over the past few years, consumers have been looking for the customized products. A few players such as The Home Theater Company offer customized products at premium prices. These manufacturers provide personalized home theatre packages as per consumer’s preference, room size, and room design. This emerging trend of customized systems will widen the scope for home theatre in the near future.
Consumers’ preference has been shifting towards home entertainment and theatre solutions owing to increasing prices of movie tickets. This trend has encouraged the buyers to invest in high-quality speaker systems as they create a cinematic experience in their homes. However, high installation cost of the home theatre is expected to refrain the buyers from using them. Similarly, availability of low-priced in stand-alone speakers is expected to be a key challenge for the market.
As of 2018, the offline distribution channel dominated the global home theatre market, accounting for more than 80.0% share of the total revenue. The brick and mortar retail provide installation and after-sale services by the experts. Furthermore, availability of compatible products for audio equipment works as an advantage of these stores.
The online distribution channel is projected to expand at the fastest CAGR of 8.8% from 2019 to 2025. Over the past few years, customers' trust is increasing in purchasing high-value products through e-commerce due to improved delivery conditions, along with availability of a wider range of payment options. Asia and North America have been witnessing remarkable growth in online consumer electronics sales. A large part of U.S. online consumer electronics sales has generated through e-commerce. Amazon, Best Buy, TigerDirect, Newegg, JR.com, and Buy.com are the major online retailers in the consumer electronics sector.
As of 2018, the home theatre in a box system (HTIB) segment held the largest share of more than 65.0%. These systems comprise components including surround sound speakers, Blu-ray/DVD/CD player, amplifier, radio tuner, remote control, and cable accessories. The surround speakers enhance the experience of the home cinema by providing theater-like sound. The home theatre in a box systems are available in a wide variety ranging from 2.1 channel to 9.1 channel. These systems have different speakers such as front speakers, surround speakers, rear speakers, center speakers, and subwoofers. Center speakers provide dynamic sound effects and reproduce the dialogues. On the other hand, surround speakers enhance the ambiance and sound effects.
The components come with the product including Blu-ray/DVD/CD player and surround sound speakers are usually compact, which saves space. Rising sales of large-sized televisions with high screen resolution and projectors have been improving movie theater experience of consumers at their own homes with more comfort. This trend is expected to promote the demand for home theatre in a box system among the consumers.
Sound bar is the fastest growing segment, expanding at a CAGR of 8.7% from 2019 to 2025. The product contains multiple speakers placed in its cabinet that create a stereo effect and surround sound. The installation of sound bar is easier than classic HTIB. Usually, it requires only one cable to connect with television.
Over the past years, the producers have been launching sound bars equipped with Bluetooth connection. This feature has been increasing importance of sound bar as majority of the consumers use entertainment devices with a Bluetooth connection. Furthermore, these products are more affordable than home theatre in a box system. Therefore, sound bars are anticipated to witness popularity among the middle-income class consumers.
North America dominated the global market in 2018, accounting for more than 40.0% share of the total revenue. Increased demand for high-quality audio and sound system in the U.S. and Canada has fueled the market growth in this region. More than 40.0% of U.S. households own a home cinema system.
Asia Pacific is projected to witness the fastest growth in the upcoming years. An increasing number of middle-class income people, along with rising urbanization in the developing countries, including China, India, Indonesia, Malaysia, Philippines, and Thailand, has been promoting the growth of the market in this region. Rapidly increasing adoption of innovative technologies, such as wireless and voice control, has also impacted the industry growth positively in Asia Pacific. This region comprises key players including LG Electronics Inc.; Panasonic Corporation; Sony Corporation; and Samsung Group.
The industry is highly competitive with a large number of well-established and emerging players. Key manufacturers of home theatre include Bose Corporation; LG Electronics Inc.; Panasonic Corporation; Sony Corporation; Samsung Group; Koninklijke Philips N.V.; Bowers & Wilkins; Atlantic Technology, Inc.; Definitive Technology; GoldenEar Technology; Yamaha Corporation; and Pioneer Corporation. Increasing competition is expected to lower the prices in the upcoming years. Furthermore, product innovation plays a key role in terms of gaining a competitive advantage. For instance, in August 2018, Sony Corporation launched two 5.1 channel sound bar home theatre systems, HT-S700RF and HT-S500RF. HT-S700RF contains two tall boy speakers, whereas HT-S500RF offers two book shelf speakers. Similarly, in the same month, Bose Corporation launched Bose Soundbar 700 that offers surround wireless speakers. This product is featured with a voice control facility as it has built-in Amazon Alexa in it.
Over the past few years, manufacturers of home theatre have been adopting a product bundling marketing strategy by collaborating with smart TV manufacturers, especially smart TVs. Usually, flat-screen and slim TVs do not provide high-quality built-in speakers. Therefore, TV manufacturers combine audio devices with TV and sell them as a single product.
Base year for estimation
Actual estimates/Historical data
2015 - 2017
2019 - 2025
Revenue in USD Million and CAGR from 2019 to 2025
North America, Europe, Asia Pacific, Central & South America, and Middle East & Africa
U.S., Germany, U.K., China, India, Brazil, and UAE
Revenue forecast, company share, competitive landscape, and growth factors and trends
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This report forecasts revenue growth at the global, regional, and country levels, and provides an analysis on the latest industry trends in each of the sub-segments from 2015 to 2025. For the purpose of this study, Grand View Research has segmented the global home theatre market report based on product, distribution channel, and region:
Product Outlook (Revenue, USD Million, 2015 - 2025)
Home Theatre In A Box System (HTIB)
Distribution Channel Outlook (Revenue, USD Million, 2015 - 2025)
Regional Outlook (Revenue, USD Million, 2015 - 2025)
Central & South America
Middle East & Africa
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