Alexa Is Losing Her Edge

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Alexa Is Losing Her Edge

A year ago, everyone was buying an Amazon Echo. Here’s how Google turned the tables.

It’s easy to imagine a world in which “Alexa” is synonymous with talking computers, or Echo with smart speakers—just as Kleenex is synonymous with facial tissue, Xerox with copy machines, or Google with online search. (These are called genericized trademarks, or proprietary eponyms, by the way. They need a better name.)

That’s almost the world we live in today, thanks to the dramatic early success of Amazon’s pioneering smart speaker and the surprisingly capable digital assistant that animates it. Almost, but not quite.

It’s true that voice-powered smart speakers are on the path to ubiquity: Analysts predict that most U.S. households will eventually have one. But at a time when sales are booming around the world, it’s becoming clear that Amazon’s first-mover advantage wasn’t built to last.

While there are no official sales figures, mounting evidence suggests that Echo devices have been losing ground in the past year to competitors on multiple fronts. Assemble the pieces from an array of market-research reports with different methodologies, and the picture is that of a rapidly shifting landscape in which no single company is likely to dominate long-term—but if anyone does, it might be Google. That matters not only to industry watchers and investors but to anyone who cares about the business models and privacy practices of the tech goliaths that mediate what we say, learn, buy, and do.

With that caveat aside, a consensus has emerged on the broad trends. Here are three of the big ones:

• Google Home devices are rapidly catching up to Amazon Echo devices in worldwide sales and may have already surpassed them.

• Apple’s HomePod isn’t selling as poorly as some initial reports suggested, and Samsung just launched its own smart speaker.

• China is the fastest-growing market for smart speakers, and neither Amazon nor Google is a significant player there.

The common thread: Alexa is losing its edge. And the obvious question: What happened?

As recently as a year ago, Amazon single-handedly controlled the global smart speaker industry, with a market share upward of 75 percent, according to estimates from two of the leading market watchers, Strategy Analytics and Canalys, based in Singapore. Amazon itself boasted in a February earnings report that it had sold “tens of millions” of Echo devices in 2017. That figure included not only its flagship Echo smart speaker but the Echo Dot, Echo Show, and other Echos, the company clarified to me (though not other Alexa-powered gizmos, such as the Tap or Fire TV). It makes sense that Amazon was crushing the competition because there wasn’t much competition yet: Google had just launched the Home in late 2016, and Apple’s HomePod was not yet on the market. The Echo has been available since 2014.

Would-be rivals faced an uphill struggle. Amazon’s head start in smart speakers resembled the daunting leads that Apple famously built in portable MP3 players, smartphones, and tablets. But Apple’s high prices at least gave competitors an opening to build cheaper alternatives for the mass market. Not so with Amazon. Because it viewed Echo partly as a path to Amazon purchases, the company sold its smart speakers at affordable prices, opting to maximize sales rather than profit margins. How could latecomers compete?

Yet visions of an Amazon smart speaker monopoly faded faster than almost anyone expected. Google, in particular, has been catching up in a hurry. That could be partly because its Assistant is “smarter” than Alexa, by some metrics. But the Echo is more capable in other respects, and it continues to be a top-rated device in the category.

Analysts say the secrets to Google’s success lie elsewhere. A big-budget marketing blitz, an aggressive push to partner with retailers and makers of smart home gadgets, and the company’s reputation for answering search questions got it off to a good start. It didn’t hurt that the company was also pushing the Google Assistant—its equivalent of Alexa—onto hundreds of millions of Android devices. Perhaps most importantly, Google has experience, partners, and language capabilities in overseas markets where Amazon is less established.

Oh, and perhaps you’ve heard that brick-and-mortar retailers aren’t big Amazon fans. “Retailers are more open to the idea of arranging Google’s smart speakers because Google isn’t seen as such a direct competitor,” said Vincent Thielke, research analyst for Canalys.

By early this year, according to multiple industry reports, the tide was turning in Google’s favor. One firm, Strategy Analytics, estimated this month that Amazon’s global market share dipped from 76 percent to 41 percent over the past year, with Google’s rising to 28 percent. The firm projects Google’s smart speaker sales to surpass Amazon’s by 2020, said Bill Ablondi, director of smart home strategies.

Chart showing global smart speaker market by vendor in Q2 2018.

For Amazon, those numbers would be ominous enough. But Canalys reckoned in an Aug. 16 report that Google has already eclipsed Amazon in quarterly sales.

Chart showing worldwide smart speaker market by Q2 2018.

It’s worth noting that Canalys counts devices shipped to retailers, even if they haven’t yet been purchased by consumers. Canalys derives its estimates partly from suppliers, vendors, and other third parties, while Strategy Analytics relies on sources within the companies that make them. A third report, from the news and research site Voicebot, used consumer surveys to estimate how many users each firm’s smart speakers have. It found that 62 percent of U.S. smart speaker owners had an Amazon Echo, while 27 percent had a Google Home, as of May. That methodology favors Amazon by counting devices purchased in the past. But even there, Google was rapidly gaining ground, tripling its market share in the first half of 2018.

More competitors are looming: Electronics giant Samsung has just launched its Galaxy Home smart speaker, and a bevy of audio companies are gradually getting in on the game. Meanwhile, smart displays are emerging as an alternative to audio-only speakers, and Facebook is working on a device called Portal that could focus on video calling.

In the long run, though, it isn’t just Silicon Valley that threatens Amazon’s smart speaker lead. It’s China.

A year ago, pundits were wondering why smart speakers weren’t catching on in China. No one’s wondering that anymore: It is by all accounts the fastest-growing market for smart speakers. And virtually none of that growth is going to Amazon or its U.S. rivals, which don’t offer Chinese-language versions. It’s going instead to Chinese giants such as Alibaba, Xiaomi, and Baidu, which are pumping out smart speakers that go for a fraction of the price of the Echo or Home. These aren’t just cheap knockoffs, either. At CES this year, Baidu showed off high-concept smart speakers that look like lamps, ceiling lights, or even a colorful stack of blocks. Amazon and Google’s devices look outdated by comparison.

When you buy an Echo, you’re paying Amazon $85 today. But it also gives you a strong incentive to pay it $120 a year for Amazon Prime, and perhaps another $80 per year for Amazon Music Unlimited. On top of that, it makes it very easy to buy things on Amazon and plays nicely with other Alexa devices like the Fire TV.

Purchase a Google Home, on the other hand, and it will fit right in with Chromecast, YouTube, your Gmail and Google Calendar, and the Google Assistant on your Android device. A HomePod will deepen your relationship with Siri and iTunes, and so forth.

So an Echo-filled world would expand Amazon’s retail empire; a Home-filled world would broaden Google’s surveillance network and feed its A.I.; a world of HomePods would keep people ensconced in Apple’s ecosystem (especially if they’re well-off). And one shudders to think what a world of Facebook Portals might do. (Rumor has it the company delayed the device’s launch due to the Cambridge Analytica scandal.) The only darker scenario might be one in which the censorship-friendly Chinese tech companies ultimately prevail.

That Amazon no longer looks poised to monopolize smart speakers might reassure critics wary of its online retail dominance. But the prospect of Google’s dominance should give privacy advocates pause. What we have for now, thankfully, is a hotly competitive industry—the kind that is unlikely to give rise to any proprietary eponyms at all.

How to prevent your Google Home or Amazon Echo from making unwanted online purchases

Did you hear about the kindergartner who “accidentally” ordered an expensive dollhouse with a voice command? We’ll show you how to lock down your smart speaker so that never happens to you.

By   Contributor, TechHive

There’s no denying that Google Home and Amazon Echo (or the less-expensive Echo Dot, if you’re not using it for music) have changed the way we interact with our homes. Turning on the lights has never been easier, nor has it been simpler to field the latest traffic report or order delivery for dinner. The future is here, and we’re reveling in it!

But the proliferation of these devices around our homes leaves room for error. Google’s and Amazon’s connected speakers must always listen for us to utter their magic “wake” words—OK Google or Alexa respectively—in order to perform their tasks. If you don’t configure them properly, you might see random purchases show up at your door.

It happened in San Diego when a little girl asked Alexa to deliver her a “dollhouse and some cookies.” She knew the right words to say, and in a few days’ time, she had her goodies. (If you want to have some fun, watch this news clip near your Alexa-powered device and watch it light up.)

If you’re worried about family members, roommates, or pranksters making unwanted purchases on your account, you can either disable this feature altogether, or set up your Google Home or Amazon Echo so that it buys things only after you’ve specifically authorized the purchase. Here’s how.

How to disable purchasing with Google Home

google home

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Google Home doesn’t have the retail power of Amazon behind it, but you can order merchandise from such major sources as Costco, Target, and Toys ‘R Us.

Google Home isn’t tied to one of the world’s largest online retailers, so you might think there’s less of a risk of unintended purchases. But it does provide voice-payment capabilities for Google Express, which allows you to purchase products from participating retailers such as Costco, Target, and Toys ‘R Us.

google payments

Google

If you decide you don’t want to do voice payments with Google Home, just flip the blue switch.

The payments setting is disabled by default in the Google Home app. If you’d enabled it previously and have since changed your mind, it’s easy to turn off. Just log into the Home app on your Android or iOS device, tap the hamburger menu, and choose “More settings.” Tap “Payments” on the next screen. Delete everything you see there. It’s the easiest way to ensure no one in your household can run rampant with your payment information on file. Alternatively, you can simply tick the “Pay through your Assistant” option so that it’s off and unselected.

How to enable purchases on Google Home

If you want to start—or restart—making payments with voice commands, open the Google Home app, tap the menu button, and then tap on Payments. Here you can set up a delivery address and a primary payment method. Google will automatically pull in any payment data previously associated with your account (and prompt you to update any expired or out-of-date cards). The app will ll also ask if you want to grant access to any Google Home devices you have set up in your home.

Once you’ve set that up, you can order things through Google Home by saying phrases such as “OK Google, order paper towels.” Google Home will list options for relevant items and their accompanying prices. Then, you can accept the order to place it officially.

You can even ask, “OK Google, how do I shop?” for a helpful walkthrough of the process. For other services, such as Domino’s pizza delivery, the payment information is set up separately through that company’s Easy Order, which fires up the oven right after you place your order. (This works with the Echo as well.)

google home payments

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You can enable and disable ordering on Google Home via the Home app.

Disabling purchasing on the Amazon Echo, Dot, Tap, and Show

Amazon’s smart speakers are quickly becoming smart-home workhorses, but they could also be considered Trojan horses aimed at capturing more and more of your shopping dollars.Here’s how to disable—and then re-enable—purchasing power with an Amazon Echo, Dot, Tap, or Show.

If you’ve previously enabled payments any of your Amazon Echos and want to now disable it, just launch the Alexa app on your smartphone or tablet. If you have more than one device in the Echo family, you’ll need scroll past all of them—and past the blue “Set up a new device” button—until you reach the “Voice Purchasing” button. Click on the radio button to disable this feature. You’re done.

amazon echo dot

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The process for enabling and disabling voice purchases is the same whether you have an Echo Dot (shown here), the original Echo, and Echo Tap, or the new Echo Show.

How to enable purchases via the Amazon Echo

Under Settings, scroll down to “Voice Purchasing.” Tap to enable “Purchase by voice.” It’s a good idea to set up a confirmation code at this point. It willl ensure no one can order things without your permission unless they know the code. Below that, you can select to manage your 1-Click payment settings, which selects which of your bank cards to use when the purchasing happens.

When you’re ready to buy something, you can ask Alexa to order anything from Amazon—physical as well as digital goods. If you’re listening to a song, for example, you can ask Amazon to purchase the MP3 with your payment information on file. Or if you’re in need of toilet paper, you can ask Alexa to send it over with two-day shipping.

If you’re stuck, or maybe a little shy, ask Alexa how to shop and it’ll walk you through what it can do.

amazon voice purchasing

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Amazon gives you the option of adding a confirmation code that must be spoken for an order to be placed.

When in doubt, mute it

If all else fails and your neighboring dwellers are still managing to make errant purchases, you can either unplug the device or mute it. The latter is particularly effective if you have children coming over who find it amusing to summon virtual assistants.

Then again, who doesn’t? It’s why we use our voices to buy things, after all, simply because we can.

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