CES 2018 Trend 1: The Battle for the Home Begins in Earnest
The media mostly bought into the Google Assistant vs. Alexa narrative, but the situation is far more complicated than that
Until recently, the major technology platform owners were conspicuously absent from CES, instead focusing their product announcements at their own events later in the year. That changed categorically last year when Amazon’s Alexa became the star of CES 2017. Though Amazon didn’t have an official presence, many of the most exciting announcements centered around the vast quantity of devices that integrated with Alexa.
This year, Google Assistant is everywhere, from TVs to pet feeders to sixteen third-party speakers that will embed the service. Several products including connected locks from Schlange and appliances from Whirlpool — both of which added Alexa support last year — are being upgraded to support Google Assistant as well.
While some consumers may be swayed by one platform integration or another, over time many appliances will support all major control schemes. However, whereas consumers used to choose appliances from a single manufacturer for aesthetic reasons, today the reasons are more technical — if you want your fridge to preheat your oven, or your mirror to turn on the shower, they’ll all need to come from the same manufacturer. It’s likely that each appliance maker will own an entire room, if not the whole house.
Aside from the new third-party integrations, Google is also announcing an update to the platform itself which matches Amazon’s Echo show by adding a connected screen to a smart speaker. It’s difficult to turn a corner at CES this year without seeing the new “Hey Google” branding, which suggests that Google subsidized some portion of the booths that feature it so prominently, not to mention much showier displays of their investment.
Despite the appearance of a neck-and-neck race, recent reports peg Amazon’s share of the smart speaker market at over 70%, something which Google obviously hopes to change with its new partnerships. And Alexa is having a good year at CES as well, despite less prominent branding, with connected bathroom integrations from Kohler and Moen, a low-cost after-market solution for accessing it in the car, and a new in-wall light switch which embeds Amazon’s assistant.
Notably absent from much of the conversation is Apple’s platform, HomeKit. Despite a solid showing of partner integrations at CES, the delay of Apple’s smart speaker means that many media outlets have dismissed it out of hand. But voice is just one control mechanism for the connected home, and Apple’s platform does have some structural advantages that shouldn’t be ignored. Most notably, they’re the only major technology player with a successful wearable device (with at least as many sold as Google has sold connected speakers), and Whirlpool’s announcement that their connected appliances will support Apple Watch is an interesting development which will be hard for Amazon or Google to match. Intuitively, having a convenient display of data and controls is sometimes preferable to pure voice control, and Amazon and Google have been lax in building out even the smartphone versions of their home platforms.
While smartphones, wearables, and voice are all major interfaces for smart home platforms, the last major piece of the puzzle is the TV. And the most prominent streaming platform is actually still independent — for now. This year, Roku has announced even more manufacturers will be embedding their platform directly in their displays, as TV OEMs start to move away from proprietary interfaces. And following their acquisition of a multi-room audio startup last year, Roku has begun licensing their tech to makers of other speakers and soundbars, and will roll out their own voice assistant over the course of 2018.
Normally, we wouldn’t be very bullish about Roku challenging Amazon, Google, and Apple in the voice assistant space, but rumors on the show floor indicate that, after having investigated building their own smart speaker last year, Facebook might be interested in acquiring Roku. It would be a brilliant move, instantly giving Facebook a prominent presence in the living room (complete with a profitable advertising product), and their own connected home platform. Since they are the only one of the four major tech players not currently in the home, Facebook needs to make a move soon or risk being locked out as these platforms mature. If they do acquire Roku this year, expect the battle for the home to accelerate rapidly.
For brands, the commence of this home platform war means that it is best to take a step back for the moment and let the market sort itself out before hedging your bets on which home platform to go full in, for it is simply too early to tell which platforms will win this battle and which will fall by the wayside.
Despite the volatile market dynamic, however, one thing is clear — voice will play a big role in the home platform regardless of who wins, and most consumers will become addressable at home via the digital assistant of the platform’s choice. This means that if your brand still does not have a voice strategy, now is the time to start exploring your options and figuring out what your brand can offer via voice experiences. If you have already started testing voice experience on one platform or another, it is important to keep a close eye on the market, cast a wide net, and stay on the winning side.
Look for more on the dynamics of the home platforms and how they will shape consumer behavior in our upcoming Outlook.
