Smart Risk Magazine Spring 2018 | Page 13

SPRING 2 0 1 8 HOME ASSISTANTS 13 Enrique Dans is Professor of Innovation at IE Business School in Madrid (Spain), and Senior Advisor for Innovation and Digital Transformation at IE University. He received his Ph.D. from the Anderson School at UCLA, an MBA from Instituto de Empresa (Madrid, Spain), a B.Sc. from Universidade de Santiago de Compostela, and conducted postdoctoral studies at Harvard Business School. His research interests are related to the impact of disruptive technologies at three levels of analysis: individuals, organizations and the society as a whole. Professor Dans has been teaching and consulting in the technology field since 1990, is a frequent contributor and columnist in business and economic newspapers and magazines, participates in several technology startups and has written on a daily basis since 2003 in his page, www.enriquedans.com HOME ASSISTANTS, virtual assistants or smart speakers is an increasingly competitive market, one largely created by Amazon Echo, launched in November 2014 and currently the absolute leader in sales and market penetration, but one into which Google Home entered in November 2016, and Apple HomePod, unveiled at the last WWDC and available from December 2017. These devices are a combination of sophisticated sensors, speakers and microphones designed to provide quality sound and speech recognition from anywhere in a room (and with cancellation systems that recognize a command even when music is playing), with a virtual assistant developed independently, and that can be associated with other devices. Alexa, Google Assistant and Siri, provide a combination of microphones and speakers with their “intelligent” characteristics. The battle, logically, has a much more important connotation in this second segment, which was pioneered by Apple, which launched Siri in October 2011, followed by Google, which launched its Google Now in July 2012 and later evolved to Google Assistant and Amazon, which put Alexa on the market in November 2014 coinciding, logically, with the launch of Amazon Echo. The dates here are extremely relevant: the longer these platforms are on the market, the more data they generate with which to work and with which to train their algorithms, and the better they will work. While Apple and Google focused on their smartphone assistants that could be transferred to the home, Amazon thought a dedicated device would offer better performance, and developed Alexa directly with Echo after the failure of its Fire Phone. The success of Amazon Echo, which in North American has a market share of 70 percent and is already present in Germany and the United Kingdom, alarmed Google and Apple. Meanwhile, Amazon turned its assistant into an open ecosystem, offering developers the ability to create skills to equip the device with functionality. As a result of its wider distribution it is the ecosystem for which there are the greatest number of skills: virtually all devices for home automation, from intelligent light bulbs to thermostats and locks. While Apple still seems to be positioning its HomeKit as a music player, the struggle between Amazon Echo and Google Home is more about the quality of the assistant and the integration of functions. A recent study by an advertising agency based on a sample of 3,000 questions concluded that the Google assistant answered six times as many questions correctly as Alexa. What does this mean? That while Google has been feeding and developing its Knowledge Graph since 2012 to make it a fundamental part of its search engine, Amazon relies solely on the material it obtains through the interaction of its users with its devices, which are inferior in terms of quality and quantity. Does this make Amazon the winner? Not quite: owners of this type of device seem to lean toward using them for automating tasks and requesting simple functions such as the time, news or other types of routine requests, rather than asking more complex questions. Google Home may be smarter when it comes to answering general questions, but people do not seem to want that, and instead would prefer it to be able to connect to other devices, with skills created by more developers and more day-to-day type features. It would seem people want a diligent butler more than a wise guy who can answer any question. How will this competitive dynamic evolve? Is it more important to focus on ecosystem development and functionality, or to develop IQ? Or, as Apple seems to be suggesting, doing one thing very well — putting music on — and seeing how things develop. Apple mentions the possibility of using its HomePod for simple tasks like turning on the lights, setting an alarm clock or reading the news? The contestants are ready to do battle, promising a truly interesting contest. If they are currently available in your market, which do you think you would choose? What would influence your decision?