The season of announcements typically starts at the end of September. I will summarize and analyze all the (meaningful) announcements here as well as share my perspective on the voice market, both globally and over here in Europe. Here is your monthly digest.

An avalanche of Voice announcements this month

Amazon shot first by announcing no less than 16 new or updated products. We can divide those into two categories: smart home – which includes smart speaker – and wearables. Most of the announcements on the home front were somehow expected with newer, better versions of existing products and the further integration of Ring products into the offering. Where Amazon surprised many is with its aggressive push into wearables. The company behind Alexa showcased three innovations: smart glasses, smart ring, and smart earbuds. That attracted quite some coverage. Some of those products may not become a success but are critical to Amazon’s mobile strategy. Not owning its own OS like Google with Android or Apple with iOS, Amazon could see its Alexa assistant being “replaced” by the native mobile assistants of those companies. The wearable release, especially the earbuds, aims to give Alexa additional touchpoints to users out of home and therefore help to get deeper embedded in its users’ daily life.

A few weeks later, Google held its “made by Google” event. With plenty of information leaked prior to the event, there wasn’t much surprise effect and the event was mostly around the new Pixel 4 phone, the Nest product range as well as….earables. Google announced the release of its Pixel Buds for Spring next year. That seems weird as this means foregoing the benefits of the Christmas season and therefore leaves the floor to potential competitors to invade users’s ears.

We will skip the announcement of Microsoft Surface Earbuds. Yes, it is supposed to be well connected to Office 365 via Cortana and allows dictating a word document, but it seems the company doesn’t have much expectation for it. Neither do I.  At the very end of the month, Apple, whose voice strategy – if there is one – remains a mystery, launched its new AirPods Pro. As one would expect, the company goes after the premium segment and is trying to leverage its large iPhone user base.

The battle for the ear will be fierce

So, here come the Echo Buds (Amazon), Pixel Buds (Google), Surface Earbuds (Microsoft) and AirPods Pro (Apple). All those arrive on top of the existing Galaxy buds as well as a multitude of other products from companies like Bose, Sony, Sennheiser…etc. All offer slightly different quality of sound (noise cancellation or not), different styles and come at very different prices ($129 for Echo Buds to $249 for AirPods Pro). On top of deciding which one to get, the real question is why is everyone launching hearables?

The short answer is: to be in contact with the customer and to somehow own it. The same way as the OS loyalty for smartphones is strong, we could assume the loyalty towards an assistant will be as strong. Once you “learn” about an assistant, while at the same time the assistant “learn” about you, creates a moat for the competing assistants. It is also safe to assume that loyalty towards hearables is rather weak. So if companies having their own assistant could invade your ears and get close to you, this could be a defining moment when it comes to trying/sticking to an assistant. So, just like the battle for the home was fierce, expect the same when it comes to the ear with plenty of new products, price wars and the likes.

 

All About Voice Conference

I attended AllAboutVoice in Munich earlier this month. This was the conference second edition and having attended both I found it interesting to compare the audience and participants’ feelings 12 months apart. I would put it in 3 points:

  • The European Voice Ecosystem is real and growing
    • More people building with or around Voice. More brands moving in. Different use cases than in the US
  • The potential for Voice is massive
    • Smart speakers are only one aspect of Voice. Voice is getting everywhere
    • Voice as a User Interface has evolved into Voice Assistant and we start to see the next steps as the Assistants becoming Virtual Assistants
    • Brands have noticed that Voice will have an impact on their business and have started experimenting. No clear “killer app” or “successful voice business model” yet, but experimentations and iterations are happening
  • Developers are disappointed by the platforms (Google and Alexa)
    • Their communication with the developer community is really disappointing. You can’t get a comment, number, roadmap information, the rules keep changing…etc.
    • Lots of aspects of those platforms have been broken for quite some time and it seems like nothing is being done. A great example is Discovery: lots of people ignore that Voice apps do exist, and when they do, look at the user experience that the Skill or Action store is offering them. That is a disgrace.
    • Platforms are also limiting innovation by deciding what you can / can’t do on their platform. One example: adult games. Another: no advertising on the platforms.

So while the brands moving to voice are all excited about the potential, at the same time here is a bit of disillusionment on the independent developer side. It’s getting harder and harder to build quality voice apps on constantly evolving platforms and once built your apps are extremely hard to get noticed and to monetize. While those independent developers remain definitely optimist about the long term future of voice, it is currently hard for them to make a living. It would be a wise decision for Alexa and Google to tackle their most pressing issues such as discovery as it would benefit everyone in the long term.

Europe lagging behind in terms of Smart Speaker Penetration

During the conference, Bret from Voicebot released some data from the research firm Strategy Analytics regarding smart speaker penetration in some European countries. The data confirmed the empirical data I gathered, with the UK clearly ahead in terms of penetration rate with more than 1 in 5 households being equipped with a smart speaker. Germany follows with a bit more than 1 in 10 followed by France with 1 in 13. As a benchmark, the latest estimation for the US is about 1 in 3.

The underlying factor behind the discrepancies is clearly the time where smart speakers have been introduced in the countries. Now, with the growth being somehow similar across the continent, and knowing that the fourth quarter represents about half of the smart speaker sales, we could expect to have penetration rate reaching 28% in the UK, 16% in Germany and 14% in France by year-end. This means that users are not only the tech innovators and the early adopters, but the early majority is also joining in. Brands willing to connect with their customers can’t overlook those numbers anymore.

 

Smart Speaker Europe

Alexa and Amazon Pay getting closer, allowing you to pay your bills via Voice

That news did not get the coverage it deserved as everyone’s attention was on devices release announcements. Amazon announced at the Money 20/20 conference that its service allowing Alexa users to pay their utility bills via voice command will be rolled out worldwide. The service was introduced earlier this year in India and is currently being rolled out in the US. No release date announced for Europe yet. Practically, once set-up, users can ask Alexa how much is their bill, when is it due, what are the differences compared to previous months…etc. and then simply say “Alexa pay my electricity bill” and everything will be taken care of.  Amazon Pay is a fantastic product and linking it to Alexa is definitely a smart move from Amazon for at least two reasons. First, it will get people used to pay via voice and therefore this could be the spark needed to ignite voice commerce. Secondly, it increases the switching cost between assistant.

Fundraising News

Unless I missed some (it has been a very busy month), it seems like there has only been one fundraising announcement this month: Algolia, the French-born, San Francisco based company raised $110 million from Salesforce Ventures and Accel. While they are not a pure voice player and voice is only a small part of their business today, they see voice becoming a major part of it. In the funding announcement, the ambition for conversational and voice search capabilities is clearly stated.

Alexis Hue

Alexis Hue

Alexis is the founder of Voice & You, a boutique consulting agency where he advises brands on how to utilize Voice to increase their competitive advantage. Part-time venture capitalist, part-time entrepreneur, and originally from France, Alexis now lives in Berlin.