The Smart Home Arms Race Between Amazon and Google Is Heating Up

November 2, 2017 - 7 minutes read

IoT developers, grab the popcorn. AI developers, bring the salt and butter. Get some good seats, because there’s a smart home battle brewing. Amazon, Google, and some of the other big names in tech are competing for their share of the smart home market. Regardless of who you’re rooting for, you won’t want to miss this showdown.

It’s Good to Be King

New research from Forrester indicates that approximately 244 million smart home devices will be in use by 2022. That’s quite a leap from the 24 million that circulated in 2016. With that projected growth, it makes sense why tech giants are vying for the smart home throne.

But Forrester’s data also indicates one company already sits in it — Amazon sold more than 11 million of its Echo devices in 2016. That’s not even the craziest part — Forrester expects Amazon to sell double that amount in 2017Per Strategy Analytics, Amazon’s share of the current market is an astounding 68 percent.

Considering its wide selection of smart home devices that range in price from $35 to $179, this comes as no surprise. The company has declared that November is Smart Home Month and has kicked off the month with special deals on an array of smart home devices as well as the release of an updated Echo and the new Echo Plus. Amazon’s developers in Seattle have also been hard at work on a new AI update that allows you to make customized commands and schedule automated tasks.

But besides playing an extremely active role in supporting its line of smart home products, what other reasons explain Amazon’s success? One word — trust. In a recent survey by the Verge and Reticle Research, Amazon was not only the most-liked tech brand but also the most trusted one, beating out Apple, Google, Microsoft, and Facebook.

Consumers seem to trust Amazon with personal details as much as they trust their banks. Which is important if your objective is to get people to buy devices that listen to their voices. It’s one of the biggest problems that Google faces if it wishes to wrestle the top spot from Amazon.

The Top Contender

Because it’s in the business of selling data to advertisers, Google is haunted by the idea that they watch everything we do. A fumble during the release of their new Home Mini speaker earlier this month didn’t help the sentiment much. Several of the new devices had an issue that caused them to inadvertently record users throughout the day.

But Google isn’t down for the count. And they’re not letting Amazon keep the spotlight for Smart Home Month so easily. Recently, the tech titan announced that products by Nest would integrate with its line of Home smart speakers to allow more sophisticated abilities, like being able to create a multi-step routine that can be triggered with a simple phrase.

Since Nest is owned by Alphabet, Google’s parent company, this makes sense. But while the multi-step routines probably work best with Nest products, Google also announced that they would also work with at least 1,000 smart home devices from over 100 other brands.

Others Eyeing the Throne

This December, Apple makes a late entry into the smart home battle with their HomePod speaker. At $349, the price for this Siri-powered smart home device is much steeper than its competitors. Siri earned Apple the AI throne in 2011, but six years may prove to be too long of a wait for the company to capitalize on its AI darling in the smart home terrain.

Besides falling behind Amazon in consumer trust, the Verge’s recent survey also found that Apple ranks behind Amazon in a surprising category — passion. Amazon is perceived to place a higher priority on improving its services for its customers. A recent example of this is Amazon’s acquisition of Whole Foods. Amazon’s first order of business was to reduce prices across all Whole Foods locations.

For years before this, Amazon’s quarterly financial results would suffer due to the company’s constant experimentation and attempts to enter new markets. Not so long ago, one of those new markets was the smart home, so Amazon’s risks seem to be paying off. People take notice of a company’s ambition, and many unfortunately feel that Apple’s innovation and risk falls a little too far on the conservative side for their liking.

While not as attention-grabbing as the aforementioned tech giants, Microsoft also has its eyes on the smart home space. Its first smart speaker, the Harman Kardon Invoke, is a combination of Cortana, Microsoft’s AI assistant, and hardware from Harman Kardon.

Reviews have not been kind to Microsoft’s foray into smart homes. CNBC found the device to be unreliable and lacking features that all of its competitors had. Similarly, the Verge noted that the call quality and selection of third-party software were poor. At $199, the Invoke falls in between its competitors’ prices. Like Apple, people may be too quick to call out Microsoft’s end in this smart home race.

The Race Isn’t Over Yet

While it may seem like there is a clear winner to sit on the smart home throne, the race isn’t over yet. It wasn’t that many years ago when the idea of Amazon entering this market was laughable; they were mostly known for e-commerce and books. Now, not only do they own Whole Foods, but they are also the dominant player in the smart home market.

But Amazon’s relentless pace to maintain this title shows that the company knows this is no time to rest on laurels. Things could change just as drastically in a few short years. Regardless of who you’re rooting for, we’re the real winners, because, at the end of the day, we’re the ones who get to enjoy all of the emerging technology from this tech market competition.

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