Share price drops for both Amazon and Google after quarterlies

Despite reporting quarterly numbers most companies would kill for Amazon and Alphabet share prices dropped by 8.6% and 5% respectively due to investor disappointment.

More than anything else it shows the high demands of investors but also the confidence which is being placed in the internet giants. With Amazon reporting a revenue increase of 29% to $56.6 billion for the quarter, while Google parent company Alphabet reported $33.7 billion, up 21%, the expectations are certainly high.

Starting with Amazon, the revenue increase of 29% paled in comparison to the more than 10X lift in net income to $2.9 billion. While this would be a regular cash bonanza for most companies around the world, sales guidance between $66.5 billion and $72.5 billion for final quarter were lower than what the market wanted to hear. The more coy guidance for Amazon’s busiest quarter resulted in the 8.6% drop, after confidence during the day sent stock up 7%.

In Google’s HQ the story was slightly different. Revenues of $33.7 billion, up 21%, and net income of $9.1 billion, compared to $6.7 billion in 2017. Shares were down 5%, following a 4.4% rise across the day, after sales figures did not hit the expected heights. The last three months have been a tough period for investors to swallow with various scandals dropping share price by 8.8% over the last three months.

Of course, it wasn’t all bad news. The cloud unit for both businesses is continuing to rack up revenues with AWS up 45% to $6.7 billion across the quarter and Google’s other revenues segment, which features cloud up 29% to $4.6 billion. Encouragingly for both, Gartner estimates the worldwide public cloud services market is projected to grow 17% percent in 2019 to total $206.2 billion, up from $175.8 billion in 2018. IaaS is set to get the largest boost, forecast to grow 27.6% in 2019 to reach $39.5 billion. With so many businesses around the world citing a cloud-first approach, it’s amazing to think only 10% of workloads have been moved into the cloud.

The relatively new venture into the world of smart speakers and virtual assistants is proving to be a continued success story as well. For Amazon, the number of Alexa-compatible smart home devices has quintupled to more than 20,000 devices from 3,500, while the team have also started to launch new products such as a smart home security solution (Alexa Guard), and Alexa is expanding what it can give updates on as well, such sports with predictions, live streams, cooking instructions and maths homework. For Google. the Assistant has expanded to 20 languages and 76 countries, while the devices with screens will help YouTube business, which is attempting to blend in more direct response adverts as well as branding to its proposition.

There will of course be short-term wins for the pair in this space, but this is a long-term bet. Once the idea has been adopted by the mass market, the opportunities to make money through third-party relationships will be quite remarkable. Search revenues can be moved into the voice domain (effectively anywhere) and look how profitable search has been for Google. This is only one way to make money, but both Amazon and Google are putting themselves in a remarkably strong position for the future.

Both businesses might have suffered in the last 24 hours but they are still in incredibly dominant positions. The cloud units still have incredible growth potential, while the smart speaker ecosystem is starting to become a reality. For Google, the is delivering amazing profitability but sales growth does seem to be slowing slightly. Amazon is delivering on the North American market but the business is not as effective on the international scene, posting a loss of $385 million.

There are issues, but these are nothing compared to the billions being raked in and the growth potential in new, lucrative markets.

Facebook eyes up the connected home space

Facebook has seemingly taken its first steps towards the connected home market with the launch of Portal.

As it stands, Portal is being marketed simply as a video calling product, though with partnerships with various content streaming channels and a tie-in with Amazon’s Alexa, the future could see Facebook enter the fray as a competitor in the smart home hardware segment.

Two products will be released to start with, Portal and Portal+. Portal will feature a 10-inch 1280 x 800 display, while Portal+ is a larger model with a 15-inch 1920 x 1080 pivoting display. Powered by AI, Facebook claims the smart camera automatically pans and zooms to keep everyone in view, while smart sound features minimize background noise and enhances the voice of whoever is talking. How effective the AI remains to be seen, however now the idea of smart communications products have been normalised in the home it won’t be too long before some pretty impressive products will start hitting the market.

Such a venture could prove to be a very useful gander for the Facebookers, as diversification is going to need to happen sooner or later. With younger demographics searching elsewhere for their social media fix, Snapchat and Facebook-owned Instagram benefiting, pressure will soon start to mount on the advertising business.

Shareholders are used to exceptional year-on-year growth figures, but it wouldn’t be a surprise to see these flatten; people are becoming less engaged by the platform, therefore spending less time exposed to adverts, while recent figures have shown key markets are not boosting total subscription numbers. Sooner or later a threshold will be hit; only so many adverts can be placed in front of users. Perhaps this is where the Portal products can help.

Unlike the other internet giants Facebook hasn’t really done an exceptional job of diversification. It has added more advertising products (i.e. different ways to engage users on the platform), but this isn’t genuine diversification. If the audience for the core product declines, Facebook’s business suffers; it doesn’t matter how many products there are if no-one is one the other side of the screen to see them.

Google or Amazon however have supported their core business with outside bets. Think of the cloud computing businesses they own, or the content platforms, or ventures into the grocery sectors. These are ventures which diversify enough to ensure negative impacts on the core business do not have a significant impact, however, close enough to lean on the brand and expertise.

With the Portal products, Facebook could make a play for the focal point of the smart home. This has a couple of interesting benefits, one of which will be controlling the gateway and therefore access to the consumer. By operating a window to the consumer, the owner of the window can charge access to gaze through. Partnerships are already in place with the likes of Spotify Premium, Pandora, and iHeartRadio, as well as Food Network and Newsy. This is a business model which could certainly be successful should Portal offer scale.

It is a simple, but effective idea. The window owner would also have the opportunity to launch new services and products which be installed as default, offering an entry-point to the data economy, in the same way Google dominates the mobile OS space with Android.

The focal point of the smart home is still an on-going battle, though Amazon and Google do seem to be winning with their smart speakers. The telcos have a chance with the router, though the proactive nature of the internet players is wrestling the ecosystem behind the speakers. However, today’s generations demand screens. Amazon has been trying to launch its own smart device with a built-in screen for months, though a difficult relationship with YouTube has not helped the situation.

Should Facebook be able to launch a video-orientated product, with high-enough specs, deep connections to the smart home ecosystem and smart enough AI applications, it could make a dent in the market. No-one has really produced a product which grips onto the space, and priced at $199 and $349, it isn’t out of the question for the Portal and Portal+.

Unsurprisingly, Facebook has made a point of security. AI applications are stored on the device, meaning data will be processed locally not transferred to the cloud. It’s almost as if Facebook has accepted it has a terrible reputation for data collection and management, and is offering an alternative to trusting the team with your personal information.

The big question is whether people trust the Facebook brand enough to give the business such prominent influence over so many different aspects of their lives. Even with a physical cover for the camera lens, users might be sceptical, though if there is ambition for additional services, there is a lot of work which will need to be done. The brand is not in a very good position when it comes to credibility and trust.

Another area which might prove to be a stickler for the product is that you have to have a Facebook account for it to work. This might not prove to be an issue at all in the long-run, though considering there will be people who don’t have and don’t want a Facebook account, or people who have intentionally deleted theirs as a result of recent scandals, it might be immediately ruling out a number of potential customers.

Connected speakers could refresh smart home euphoria

Enthusiasm for connected devices is on the rise, but it’s taking the buzz away from smart appliances and the smart home category on the whole.

According to research from GfK, products which are geared towards improving connectivity and entertainment are gaining traction in the market, though this is replacing the appetite for smart home appliances which are geared towards efficiency and functionality.

“Take-up of smart home products in the UK continues to rise, with interactive speakers the hot product of the last year,” said Trevor Godman, Divisional Director at GfK. “In contrast however, the level of consumer excitement about smart home as a category has lost momentum somewhat – particularly for smart appliances and smart health products.  As smart home pivots to the mass market, it is essential that manufacturers look at what is holding consumers back and communicate compelling benefits that capture consumers’ imaginations.”

While Godman is taking a rather negative approach to the trends, we do not see it in the same light. The idea of the smart home, and various devices in the kitchen or around the house being connected and programmable is not a new idea. The smart fridge or connected light bulbs have been around for years without stimulating enough momentum for the segment to really take off. A creative spark was needed to engage consumers and offer an attractive proposition, unfortunately, smart energy readers do not offer this. Smart speakers and TVs do however.

For the mass market to embrace new ideas, there needs to be genuine excitement. Being able to switch the light in the living off with your smartphone might be functional and useful occasionally, but the smart speakers capture the imagination of the consumer. These are products consumers would actually want to buy, instead of a central heating system which reacts to the weather outside.

According to the research, the UK smart home market was worth £900 million in 2017, making it the second largest market in Europe. It has also become the fastest growing, increasing by 19% in value from 2016 and 35% by volume. There are now 336 brands offering 3,777 smart home products, while 85% of the UK’s online population now own at least one smart product, and the number owning four or more has grown from 35% last year to 44% this year. The fastest growing segment is smart speakers, though this does seem to be at the expense of other categories.

Manufacturers of smart cookers or connected mirrors might look at these statistics and worry, though GfK suggests consumers who plan to buy a smart device or appliance in the future have their sights set on a wide range of products. The smart home might have failed to deliver over the last couple of years, though the accessibility and entertainment value of smart speakers does seem to open up consumers to new purchases.

The purchase of smart home devices might not be growing across the board, but that isn’t necessarily awful for those who have their eyes on the long-game. Smart speakers are normalising the idea of the connected economy. Once the basic concept has been accepted by the mass market, the opportunity to sell becomes significantly easier as value is more readily realised and accessible.

Philips might preach about the benefits of a smart central heating system, but the frivolous purchases were needed to normalise the segment first. The smartphone ecosystem didn’t explode overnight, there were years of adoption as the touch user interface become second-nature, the same could be said here. Frivolous purchasing is needed before the connected bug can spread throughout the home.

Smart speakers starting to drive next era of digital

Years usually pass before the world realises a technology breakthrough actually happened and it catches on; the voice user interface might just have arrived at that watershed moment.

The fantastic breakthrough of touchscreen mobile phones is often attributed to Apple, though if you go back to 1992 IBM unveiled a phone called Simon which featured the first touchscreen. Apple didn’t invent the concept of touch screens, it simply innovated, making the iPhone a genuine smartphone as opposed to a PDA. This might seem like an odd introduction, but the same trend is emerging in the smart speaker world.

Amazon and Google did not invent the concept of the voice user interface, they simply used their brands to effect change and offer a product which was dutifully adopted by the masses which call themselves fans. In releasing their own smart speakers, the two internet giants did what other companies couldn’t; they normalised the voice user interface.

According to Nielsen’s MediaTech Trender survey, the smart speaker has penetrated the mass market and is normalising the concept of the smart home, as well as the idea of your voice being the control function. Across the US, 40% of homes now own at least one smart home device, with 24% owning a smart speaker, up from 22% in the previous quarter. Of those who currently own a smart home device, 65% plan to purchase more. Looking at the speakers themselves, usage is up, the average user interacts with the device for 72 minutes on the weekend and 65 minutes during the week, while 81% of users report using voice-command searches for real-time information, such as weather and traffic conditions, during a typical week. The more normal it becomes to use your voice in the home, the more acceptable it becomes elsewhere in the world.

Another interesting statistic from the report are the services synced to the speakers. Music streaming services are unsurprisingly the most popular, 53%, while the second most popular is shopping apps at 52%. With the user seemingly becoming accustomed to ordering goods through the smart speaker, there are a horde of new opportunities emerging, from grocery shopping to on-demand purchases linked to advertisements.

Finally, the most device synced to the smart speakers is the smartphone. This might seems like a very obvious statement, though only 32% of the respondents have linked their smartphone to the device. This is a small percentage of what is possible, though the potential to learn more about these individuals who have synced their devices is quite exciting. The virtual assistant is no-longer limited to the users home and can start to learn about habits in the big, wide world. This offers a much more in-depth opportunity to create valuable, personalised services.

As it stands, the smart speaker is little more than an entertainment product. 90% of users listen to music on the devices, 81% search for real-time information such as the weather, 68% listen to the news and 68% use it for alarms or timers. However, these devices are introducing new concepts and features which are gradually becoming accepted and normalised by the user. The voice user interface is an incredibly important one.

Just like the touch interface opened up new opportunities to make money, the voice interface will do the same. But this is a while down the road, mass adoption of both new devices and the normalisation of new concepts need to take place first. New ideas open the mind up to even more new ideas, including services and products, as well as blurring the lines of what would be considered intrusive or unacceptable. The smart speaker is playing a critical role here.

Security could make telcos more than a utility in the smart home

With the smart home becoming more of a reality, new research from Open-Xchange suggests the largely ignored security market could be a money-spinner for the telco industry.

As it stands, no-one has really taken ownership or responsibility of the security side of the digital economy. More of our lives are being moved online, more of our time spent on a larger variety of devices, though there hasn’t really been a drive to make this virtual world secure.

“The market for connected devices is ballooning as we all scramble to fill our homes with the latest gadgets, all aimed at making our lives simpler,” said Rafael Laguna, CEO of Open-Xchange. “Yet, the convenience of connected home technology should not let us neglect our family’s online privacy and protection.”

According to the research from Open-Xchange, the average household contains five smart home devices, though only 15% of UK parents use cyber-software or apps to control access and protect the IoT connected devices. 28% of UK parents have no plans to strengthen security measures for their connected devices, though 85% of them would leave a service provider in the event of a data breach. 17% do not use any protection at all, and 67% use anti-virus and anti-spam software to protect only their desktop devices from malware, adware and phishing tactics. The smart home is potentially an open-goal for a lot of nefarious individuals.

While it would be an uphill struggle, there is an opportunity to make money. Of course, many consumers, your correspondent included, takes security for granted though the blame would lie with the telco in the event something went wrong. There is of course an education process to undertake, consumers are responsible for security inside the home not necessarily the telco, though such products could offer the telcos an opportunity to generate additional revenues on top of connectivity.

This is not necessarily a new idea, Orange is running a smart home security business in France, though little of these ideas are currently being used in the UK.

“With more than 70% of IoT devices vulnerable to attack, there is a massive opportunity for internet providers to update their offering, raise brand awareness and unlock new revenue streams by offering a truly secure online experience for all,” said Neil Cook, Chief Security Architect at Open-Xchange.

As it stands, the internet players are shifting the focus on the smart home away from the router and towards products like speakers which will house the virtual assistants. In moving the focal point, control of the ecosystem is also shifting, potentially relegating telcos to the role of connectivity utility. For the telcos to avoid the dreaded downfall to utilitisation, value must be added to the ecosystem and security is one way which it can be done.

For many consumers, the connectivity provider would also be a logical place to source security solutions, and the telcos do have a credible relationship. Most consumers would already trust their connectivity provider, while few telcos have been the victim of a costly, both financial and reputational, data breach. Logic, credibility and accessibility, the router, all combine to put telcos in an excellent position to offer security products.

Sooner or later investors will start asking executives why everyone else is making money from the digital economy while the telcos are simply collecting the connectivity crumbs. This is certainly one way which that awkward conversation could be avoided.

Alexa is starting to turn into a genuinely helpful assistant

Amazon has unveiled a host of new features and skills for its Alexa virtual assistant, edging the living room closer to the intelligent dream we’ve all been promised.

While you cannot argue with the gimmicky entertainment brought by virtual assistants, you have to wonder whether it is anything more than five minutes of entertainment or making our lives easier in the very smallest (and often irrelevant) of ways. The new features and skills released by Amazon are starting to add some clarity to the smart home as we all imagine it from watching too many re-runs of Back to the Future 2.

“The Alexa service is always getting smarter, whether you’re using the Echo you bought three years ago or an Echo Show you buy tomorrow,” said said Tom Taylor, Senior VP of Amazon Alexa. “We have thousands of engineers and scientists inventing on behalf of customers, and today we’re excited to introduce even more features to help make customers’ lives simpler, safer, and more convenient.

“Soon customers will be able to manage their email, easily secure their home, watch the shows they love on Echo Show, and make their daily routines more productive – all just by asking Alexa.”

Right now virtual assistants are very limited in the way they work. This is partly due to customers not utilising the capabilities to full potential, though the breadth of features and skills does need to be fleshed out. It might be cruel to point the finger at Amazon, it is still early days after all, but with the big promises made in advertisements, the virtual assistants are a bit drab. That said, some of the new features do look pretty good. The difference is underlying interaction with other applications and features.

Take the new location based reminders. It’s a simple idea, but linking reminders up with GPS adds value. How many times have you walked home from the tube station, only to realise you forgot to buy peas when you are half-way through cooking your dinner. Now you can ask Alexa to remind you to pick up peas, post a letter, drop off the dry cleaning or buying a last minute birthday present, when you’re passing by the relevant establishment.

The routines is another area which been improved as well. This is an interesting feature which can be adapted to each individual. The morning playlist might depend on the day for instance, or lights are triggered depending on motion and your routine. Both of these examples take the virtual assistant away from the simple command-action scenario and factor in other variables which are not dependent on proactive actions from the user. It is actually starting to become smart.

Later in the year you’ll start to see some even more interesting features with Alexa actually making sensible suggestions depending on your actions and commands. For example, if you activate the bedtime routine by saying ‘Good night Alexa’, the white noise playlist will kick in, and Alexa might ask you whether you want it to switch off the living room light you left on. Features like this will make the virtual assistant much more than a gimmick.

The next step will be deeper integration with other applications such as Outlook calendars. When Alexa prompts you to change your alarm the night before because it has spotted an early morning meeting, it’ll start to be a genuine assistant. One step further would be linking to weather and travel update services so it can proactively change the alarm in the middle of the night if it decides your commute will take longer than it usually should.

The promise of virtual assistants has been very glorious, and so far it hasn’t met the expectations. But updates like this are making Alexa an genuinely helpful and interesting proposition.

IBC 2018: The smart home is a myth – don’t believe the hype

The vision of the smart home is powerful for the digital economy but don’t believe the hype, right now it’s a fragmented minefield of complication and frustration.

Advertisements on consumer channels and marketing collateral at industry conferences point towards the smart home as the realization of the future. Data is the fuel of this money making machine, with the promise of a space-age, free-flowing digitally enabled environment made popular by the entertainment industry. This world of convenience excites some consumers almost as much as the companies trying to make money out of it, but there is little evidence this vision is a reality.

Yes, there is consumer acceptance. There are also clever products on the market. Companies like Amazon and Google are creating incredibly complex virtual assistants and normalizing the voice user interface also. But in reality, all we have are several products, which individually connect to our smartphones, have little interaction and offer nothing but a gimmick to make our lives a little bit simpler.

The power of the smart home is to make our environments intuitive and personalised. The central heating comes on at the right time automatically, depending on where we are in the world and the temperature outside, or the TV displays personalised content depending on who is in the room. Alarms are adapted to our schedule and smart locks authorise entry to friends and stranger alike. It is the flow of information which makes these ideas possible.

According to telco and tech analyst Paolo Pescatore, there is an opportunity for the telcos to influence this space. The router should be the centre of the smart home, and should the telcos be able to create a common platform, with open-APIs to create interoperability with all devices, the dream can be a reality. Data will start to flow around the ecosystem, personalised services will begin to emerge, taking us away from a fragmented collection of gadgets, and what we have imagined as the smart home will start to become reality.

But here is the big question; are the telcos positioning themselves to capitalise on these rewards? Or might we see history replay itself? Sluggish behaviour and a lack of transformation meant the telcos were disrupted by the shift to OTT messaging platforms, missing out a massive slice of the data economy. The telcos might not lose revenue by not taking a leadership role in the smart home, though they won’t necessarily make more. Inactivity will see them remain as the connectivity utility, only collecting the crumbs which pass down the value chain. This is the road to commoditization and classification as a common utility.

Right now the likes of Amazon and Google are staking strong claims. Through normalising the smart speaker market, the focal point of the smart home can be shifted away from the router. Both of these companies are taking steps in aligning the various different ecosystems and concentrating the relationship with the consumer. The virtual assistant is being used in the same way the telcos billing relationship with the consumer could have been.

If there is to be an economy developed around the smart home, there needs to be a focal point. Too much fragmentation and too many billing relationships will over-complicate matters and frustrate the user. Telcos are moving users towards a single billing relationship for connectivity (convergence of mobile and broadband), and this relationship could have been extended to other services. Orange is trying to do this in France, though a consolidated effort across the industry is needed to wrestle control of the flow of cash away from the internet giants.

With Alexa and the Google Assistant, the two smart speakers enthusiasts are concentrating the consumers attention on one asset in the living room. This might only be simple instructions for the moment, though with shopping experiences being developed and content platforms also being thrown into the mix, they are winning the battle. The telcos are starting to look like passengers on the road to the smart home.

Perhaps more independent influences are needed to develop this common platform and establish the telco foothold. ETSI would certainly be a good place to start, and this would seem to be a project tailor made for the influential working groups. The TM Forum is searching for more validity in a digitally transformed world, maybe this is a way in which the organization can become more relevant than it is today.

Of course, a common platform is one factor when encouraging the flow of information, but another critical one is trust and credibility. Very public scandals, such as the Cambridge Analytica saga, and the almost-daily occurrence of data breaches are not providing the consumer any confidence the data economy is secure in the first place. Perhaps the telcos have an advantage here as well.

Aside from a couple of examples, the telcos have been largely innocent when it comes to data breaches. Most victims are enterprise organizations, while the internet players are having their credibility strained as more details emerge on how personal information is being used in advertising. Creating a common platform for data interoperability should, in theory, be more secure than the fragmented ecosystem which exists today, while the telcos have a strong-brand in terms of securing customer data. They have had a billing relationship with the customer for a considerably longer-period than the internet players, and still maintain that trust today. Both of these factors could be exploited in pushing the telco case for controlling the smart home ecosystem.

Ultimately the creation of a smart home will come through insight and personalisation, and these promises can only be delivered through collaboration. Maria Ferreras of Netflix highlighted it was sharing data on consumer viewing habits with partners, which is only a small aspect of the smart home, but it does inform and help create a personalised environment. Common platforms and collaboration across the industry will create more insight and accelerate the development of the smart home.

Some might argue the justification for the smart home is not there, that the fortunes are by no means guaranteed. There might well be an element of uncertainty right now, but Amazon and Google have proven to be incredibly accurate fortune tellers over the last decade. These two heavyweights fighting for control of the living room should be evidence enough there is money to be made.

The question is whether the telcos are ready to commit the R&D funds to capitalise on this opportunity. A common platform, which will allow all smart devices to communicate with each other and the consumer, is critical for the emergence of the smart home.

Many of the telcos argue they want to avoid the dreaded utility tag, but they aren’t being very ambitious trying to avoid it.

Amazon loosens tight grip on smart speaker market

New estimates from Strategy Analytics have Amazon maintaining its lead in the smart speaker market, but it’s starting to erode as more mainstream brands hit the market.

Being first to market has its advantages, but these leads are rarely maintained. Getting a jump on the early adopters of course offers a massive advantage, but more often than not the money is made in mainstream market penetration. Unfortunately for those who attempt to use the first-to-market strategy as a means to break the status quo, Joe and Jane Bloggs on the street usually revert to brands they are comfortable with.

“Amazon and Google accounted for a 69% share of global smart speaker shipments in Q2 2018 down from over 90% in Q2 2017,” said David Watkins of Strategy Analytics. “The drop is not only a reflection of growing competition in the smart speaker market but also Amazon and Google’s inability to break into the fast growing Chinese market that is dominated by local powerhouse brands such as Alibaba, JD.com and Baidu.”

Looking at the estimates, Strategy Analytics believes Amazon’s global smart speaker share of shipments fell to 41% in Q2 2018 from 44% in Q1 and 76% in Q2 2017. Google has increased its share to 28% in Q2 2018, up from 16% during the same period last year, while technology giants Apple and Samsung are intensifying competition, as are more traditional audio brands such as Sonos and Bose.

Amazon and Google are still the dominant players as it stands, though companies like Apple and Samsung, both of whom made their names in the hardware space, will test out brand loyalty with their own products. That said, consumers in the mainstream market, the majority who have more basic understanding of the technology industry, will like lean towards brands such as Sonos and Bose. These are common names in the audio market already and brands people have been buying for years; reputation and credibility means a lot for consumer purchases.

With the two market disruptors starting to flag out front, we suspect market share will gradually become more even, with Amazon and Google eventually falling back further. But do they actually care?

We’ve said this before, but these are two companies which do not have an outstanding pedigree in the hardware markets. It has not been a cash-cow for the pair, who have both focused on software and services. We believe this will be the long-term focus of both Amazon and Google.

Launching low-cost devices onto the market and capturing the attention of the highly-vocal tech enthusiasts was an excellent move. It normalised the products and demonstrated to the traditional manufacturers there is money to be made in smart speakers. Now the rest of the industry are playing catch-up, some might suggest it is mission accomplished. The pair can go back to focusing on the aspects which they are more comfortable with.

Both Amazon and Google make cash through the desires of consumers to have more of their lives online. They operate in the virtual world, making money off the ecosystem and creating free services which are attractive to the consumer. In Google’s cash it is the search engine, as well as video platforms and mapping products. For Amazon, it’s the dominant eCommerce platform, and more recently it has been venturing into subscriptions. For both the idea is simple; create an idea which is user friendly, before making money off the connection between consumers and third-parties.

The same business model is possible in the smart speaker world. Whether it is referrals for a takeaway or ordering weekly groceries, Amazon and Google can make money off the digital experience, not simply selling devices to consumers.

The issue to start with that the devices weren’t present in homes around the world, but that hurdle seems to have been conquered. With the products gathering momentum, the mission of normalising day-to-day uses of the virtual assistants can begin. This is where Amazon and Google will make billions in recurring revenues.

Should privacy be treated as a right to protect stringently, or a commodity for users to trade for benefits?

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