Amazon Echo continues AI domination into 2017

amazon echo virtually owns ai market dot
It was a holly jolly holiday season for the Amazon folks, as they watched their Echo artificial intelligence device dominate sales. Amazon’s Echo Dot was its top selling product. The other top three sellers on the site were the Fire TV Stick, Fire tablet, and Amazon Echo. The AI race between top companies like Amazon, Microsoft and Google (with Apple lurking) is only going to intensify as the market develops more uses for the tech.

Why is Amazon out front in the AI battle? Compatibility might be one reason. Business Insider reported that at CES, multiple companies like LG, GE and Ford announced partnerships with Amazon that will bring Alexa to its respective products. The report also goes on to note that Amazon rolled out its AI with commands already built in, which might have appealed to Apple owners who were fed up with getting nonsensical replies when querying Siri.

Echo is tied directly into Amazon’s e-tail ecosystem — so to speak — so the more you order, the more data goes into its recommendations, so you can order even more. Seamless integration with the massive Amazon inventory is a crucial part of the Echo appeal. As Amazon’s reach continues to grow, it will all be funneled through various devices down the digital pipeline to the end user.

“Amazon will increasingly subsidize Echo by bundling content (think music, video) with the device,” Forrester Principal Analyst Thomas Husson said on BI. “They can afford this since this is not core to their business model: the end-goal is to facilitate interactions.” In business-speak, “interactions” mean “potential sales.” One wonders if Bezos and Company will have another go into the smartphone market. After the spectacular demise of their Fire Phone, could they try again? It would be one more place to put their AI software, after all.

Unsurprisingly, the competition is fierce. Another report on BI noted that Google jumped into the home assistant battle with its Home speaker in October, which fits with its Google Assistant. Amazon doesn’t directly sell Home on its site (imagine that) and “multiple reports have said that Apple is working on its own Echo competitor as well.” And then there’s Microsoft’s Cortana, which is heavily integrated into Windows 10. Even Lenovo is entering the battle. The report adds that Google can gain a foothold by levering its massive search capabilities, and Microsoft will point Cortana towards the business space, which it dominates with its Office software.

Regarding Apple, which has been known to disrupt a platform or two in its history (think iPhone, iPod, and iTunes), Husson said “Apple is rarely a first entrant into a market, but they could well create a differentiated experience like they did for touchscreens.”

Tech’s very nature is one of evolution. You either invent or you stagnate and die, while start-ups that were a glimmer in someone’s garage fly right by at warp speed.

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