Smart Home: Google, Apple and Microsoft are watching the cake while Amazon is eating it

Here you can read this article in German.

The success of Amazon’s voice-controlled personal assistant Echo is by many considered a surprise. It’s easy to understand why: There was comparatively little media hype after its launch, the product category was unproven and Amazon’s track record regarding hardware products (other than the Kindle) has been rather mixed. But one and a half year after its release, the device, which so far can only be purchased in the US, has become a huge hit, highly rated by both Amazon reviewers as well as the technology crowd. Furthermore, thanks to the Echo, Amazon’s smart assistant software Alexa has become a poster child for the thriving category of artificial intelligence-powered assistants.

Here is what’s at least as surprising as the rise of Echo: The absence of competing products by the other big three: Google, Apple, Microsoft.

One and a half year after the initial launch of Echo, customers interested in a dedicated smart assistant gadget only have one serious option to choose from: Echo. In a few months, they’ll be able to purchase Zoe, a competitor by the German startup Protonet. But apart from that, people who would be interested in buying a similar gadget from Microsoft, Apple or Google, cannot do so. Even though all three companies have created AI-based assistants for their operating systems (Cortana, Siri, Google Now) for a few years now. So it would be a small step.

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Maybe Google hoped that Nest would become Echo’s contender, but the company that was acquired for $3.2 billion is reportedly struggling. Apple recently brought Siri in a rather limited fashion to the Apple TV and released the smart home feature HomeKit. But none is in any way comparable with what Echo offers.

Echo is a flagship product for the smart home, but one which does not put rather abstract use cases such as remote control of smart appliances into the focus. Instead it promises voice access to the Internet, to information, entertainment and shopping, with other smart home use cases as secondary features. That type of flagship product is what none of the other three has come up with, strangely.

There is a case to be made against herd mentality, which can be witnessed all too often in the technology industry. However, the Echo has more than proven that there actually is a huge customer demand for such a device. Talking to a smartphone is a different thing, especially when being at home. Amazon has shown that people want a small smart hardware box that is located at a central place in their apartment/house (or in every room, thanks to the latest addition, Amazon Echo Dot), that they can talk to. But so far, the other tech giants have completely ignored that demand. They are watching while Amazon is creating a new type of lock-in with end users, outside of their core discipline e-commerce and ebooks. There is a risk that once these people have gotten attached to Alexa, they will want to interact with Alexa in other situations of their lives as well. Not with Siri or Cortana.

There is no doubt for me that eventually, the three giants will release full-fledged Echo competitors. In fact, rumors surfaced recently about that Google plans to enter this market. There is simply no reason not to do it. The necessary AI software does exist. The proof of concept is there, as is the proof of customer demand. The business models are not hard to figure out. And the possibilities for product differentiation exist. At the core, Amazon sees the Echo as just another channel to sell things to its customers. To many, that won’t be very appealing. It is not too me. Personally I’d prefer to buy a product like this from Apple. Android/Google fans might opt for a Google device, Microsoft loyals for a Microsoft gizmo.

It’s 2016 and I’m sitting here thinking how weird it is that there are now one million different versions of the iPad as well as an Apple Watch but no “Siri Home”, that there is a HoloLens but no “Cortana Box”, that there is a [enter any Google-related gadget] but no “Android Home”. These giants must have really underestimated Echo. Or they are full of self-confidence over that they can beat Echo in regards to quality and user experience, thus they do not worry about appearing like late movers. In any case, it is time for their big move.

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