The market size for audio codec has witnessed a substantial surge over recent years, escalating from $9.56 billion in 2024 to $9.96 billion in 2025, at a compound annual growth rate (CAGR) of 4.2%. The growth during this phase has been propelled by an increase in smartphone and portable device usage, evolution of digital media, burgeoning internet streaming, and rising multimedia consumption among other factors. The market for audio codec is set to sustain its upward trend, potentially soaring to $12.79 billion by 2029 at a CAGR of 6.5%. The forecasted growth phase attributes its acceleration to the expansion of 5G and internet of things (IoT), proliferation of augmented and virtual reality (AR/VR), adoption of automotive audio systems, integration of edge computing and a rise in customization and adaptability.
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What Are the Drivers Propelling the Audio Codec Market Growth?
The growth of the audio codec market going forward is fuelled by an increase in smartphone adoption. With smartphones doubling as a primary streaming media device, there is a heightened demand for codecs that provide high-quality audio while ensuring minimized file size. For instance, as of February 2023, data from UK-based Uswitch Limited indicated an increase of 3.8% or around 2.6 million in mobile connections in the UK from 2021, totaling to 71.8 million. A projected population growth to 68.3 million by 2025 estimates that 95% or about 65 million individuals will own a smartphone, consequently driving the growth of the audio codec market.
What Are the Key Segments of the Global Audio Codec Market?
1) By Component: Hardware, Software
2) By Function: With Dedicated Digital Signal Processor (DSP), Without Dedicated Digital Signal Processor (DSP)
3) By Application: Desktop And Laptop, Mobile Phone And Tablet, Music And Media Device And Home Theatre, Television And Gaming Console, Headphone, Headset, And Wearable Devices, Automotive Infotainment
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Which Major Players Are Influencing the Audio Codec Market?
The audio codec market harbours key companies such as Apple Inc., AT&T Inc., Qualcomm Incorporated, Texas Instruments Incorporated, STMicroelectronics N.V., NXP Semiconductors N.V., Analog Devices Inc., Renesas Electronics Corporation, ON Semiconductor Corporation, ROHM Co. Ltd., Realtek Semiconductor Corp., Microsemi Corporation, Cirrus Logic Inc., Dolby Laboratories Inc., Xilinx Inc., Harmonic Inc., Nordic Semiconductor ASA, DSP Group Inc., Toshiba Electronic Devices & Storage Corporation, AKM Semiconductor Inc., CML Microcircuits, Audio-Technica Corp., VisualOn Inc., Savitech Corp., and Tieline Technology.
What are the Emerging Trends in the Audio Codec Market?
Major companies operating in the audio codec market are focused on developing product innovations such as true-lossless audio codecs to enhance sound quality and streaming efficiency. For instance, in October 2024, US-based technology corporation Honeywell launched the Honeywell Aviator Hi-Fi speaker, a new audio device featuring a True-Lossless Audio Codec that ensures exceptional sound clarity.
Which Region is the Fastest Growing in the Audio Codec Market?
In 2024, Asia-Pacific held the largest share in the audio codec market. However, North America is projected to be the fastest-growing region during the forecast period, with covered regions across Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, and Africa.
What Does the Audio Codec Market Report 2025 Offer?
An audio codec refers to a technology or algorithm that encodes and decodes audio data for storage, transmission or playback purposes. The Audio Codec Market research report from The Business Research Company offers global market size, growth rate, regional shares, competitor analysis, detailed segments, trends, and opportunities.
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