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The empire strikes back in Amazon Google battle royal over SmartHome

By October 7, 2016Article

We all knew that Google wasn’t going to take Amazon’s guff quietly. 

And so at a launch event on October 4 — as I predicted (see my post, “IoT Round 2: Why #Amazon Is More-Up and #Nest Is More-Down in the #SmartHome #M2M #IOT”) — Google announced Google Home, its new smart home speaker and intelligent voice-recognition platform.  The price was set at $129 with availability expected to be in early November. 

Google’s actions offer the long-awaited substantive response to first-mover Amazon’s Alexa, Echo, Dot and Tab. In fact, Amazon has already released what can be considered product-line extensions or second generations of the Echo with the lower-cost Dot ($50) and the Tab. 

As products, Echo and Home are similar. They play music, respond to questions, access information, integrate with different services (like news, weather, etc.) and can control various home appliances. 

As an ecosystem, Amazon is ahead. They have over a thousand skills and support hundreds of devices through their partner program. In addition, they have a powerful weapon in Amazon Prime, their $99 per year free shipping program. It gives Amazon a receptive audience of about 50 million people to whom they can sell the Echo. Or as a seeding strategy, they could even bundle it in with Prime. Google is just starting and has a limited number of partners today such as Samsung, Nest, Phillips and IFTTT. 

But in support for multiple platforms – score an important point for Google. Amazon has the Echo device in homes and the Alexa App on smartphones. They will also extend their voice UI to devices from their partners. However, Google through Chrome, Android and Google Apps, will make their Google voice interface available on many devices and systems very rapidly. 

As the most “visible” part of most users’ day-to-day lives – the AI-enhanced, voice recognition, virtual assistant user experiences will be where the real battle will unfold in coming years. Other combatants will be Apple with Siri, Microsoft with Cortana and Samsung, which just bought Viv Labs to have a similar offering for their phones and devices.  (See “The Path to Intelligence Everywhere,” a post by Dag Kittlaus, co-founder/CEO of Siri and Viv Labs on the Samsung acquisition.)

Virtual assistants have become table stakes for the connected home. And that means IoT device manufacturers, app developers and service providers will need to choose and develop to one or more new platforms if they want to stay relevant.

At the same time, Apple, Google, Amazon, Microsoft and Samsung will compete to be the leading platform of choice as they seek to get as many developers and apps as possible on their virtual assistant platforms. Welcome to the new platform wars. 

New platforms mean new opportunities and new players. Let’s see who develops some of the coolest, most useful and most wanted new ideas for these platforms – and whether they can turn those into profitable commercial (or acquisition) successes. 

As in previous technology transitions to new platforms, you can expect young, innovative players to emerge and take advantage of new capabilities to provide enhanced value.  At the same time, we are likely to see some incumbents that are unable or too slow to respond, get left behind and either fail outright or become marginalized. 

For more on Amazon’s IoT strategy, see “Amazon Developments in IoT: A Force to Be Reckoned With.” I’ll dive into Amazon’s IoT strategy at the Internet of @ThingsExpo in Santa Clara, “Monetizing the IoT” at IoT Emerge in Chicago, and “Monetizing the IoT; Show me the Money” at Licensing Live in Santa Clara. 

Chris Kocher is a managing director of Grey Heron venture consulting. He is a 30-year veteran of Silicon Valley and multiple innovation and investment cycles. Chris brings a wealth of strategic and hands-on operating experience to help CEOs, executives and investors build revenues and shareholder value. He has consulted with over 100 companies on innovating with new business models, product strategies and monetization in disruptive markets and established industries. He can be reached at if you’d like to discuss how he can assist you in growing your business. 

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