Smart Speaker Satisfaction High, but It’s Early Days

We recently surveyed 520 US consumers about smart speakers and found that 89% of respondents were satisfied with them. A closer look at the results reveals the reason for this high satisfaction; early use cases are simple (Music, weather, general questions). While questions remain simple today, we expect what users demand from their smart speakers to become more complex. The survey covered smart speaker ownership, satisfaction levels, and common uses. Here are the key takeaways:

  • 31% of respondents own a smart speaker.
  • Amazon Echo dominates the market with 55% share, followed by Google Home at 23%. See more below.

  • 89% of smart speakers owners are either satisfied (59%) or very satisfied (30%) with their device.
  • Music, weather, and general knowledge questions dominate smart speaker usage. See more below.

In line with expectations. At roughly 1/3 of the U.S. population, smart speaker penetration is in line with our current estimations. Other than Cortana being slightly over-represented and Echo being slightly underrepresented, we believe the market share in the survey data also resembles the current landscape. In terms of smart speaker use cases, our survey finds the most common activities to be listening to music, getting the weather, and asking general questions. This is consistent with studies like the one from Quartz here.

It comes as no surprise, consequently, that 89% of respondents were satisfied or very satisfied with their smart speakers. This is due in large part to the relatively simple tasks that the majority of users demand of their devices. For example, Cortana scores a 57% on our comprehensive smart speaker test. On a standard report card, this is a failing grade, but Cortana is well suited to play your music from Spotify, tell you the weather, and answer any simple question you have, so it’s easy to see why the typical user would be plenty satisfied. Put simply, people aren’t using their smart speakers for anything all that smart. But we expect that to change.

Changing use over time. The top use cases for smart speakers today make sense because they are well defined and they work consistently. Benedict Evans put it well in a blog post early last year: “You can now use an audio wave-form to fill in a dialogue box – you can turn sound into text and text into a structured query, and you can work out where to send that query.” This works really well for simple ‘google-able’ questions or fetching info from a weather app, but as the use cases broaden, it is not always clear where to send a query. Just because calling up a Spotify playlist is a well built-out process doesn’t mean the same is true for a YouTube video or Podcast. It takes a huge amount of human time and energy to make these processes run smoothly. AI assistants are a new technology, so this is not a long-term concern, but until the voice ecosystem is more robust, users will have to settle for somewhat simple use cases.

The reason we are excited about smart speakers, however, involves the much wider use of voice as a computing input to remove friction. We believe the preferred interface for countless smart home devices and software services is not countless apps or small touchscreens, but your voice. This will involve drastically increasing the number of defined places you can send those queries and the number of connected devices in your life. Music, weather, and general questions won’t go away, but other activities will increasingly take place via voice. The desire for the voice interface is there. Smart speaker adoption is outpacing that of the smartphone, and the majority of users say they wouldn’t want to go back to their life without their smart speaker. We think it’s only a matter of time until voice cements itself into our everyday lives.

Disclaimer: We actively write about the themes in which we invest: virtual reality, augmented reality, artificial intelligence, and robotics. From time to time, we will write about companies that are in our portfolio.  Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.

Face Off Part 3 – Echo vs. Google Home vs. Cortana

We tested the Amazon Echo, Google Home, and Harman Kardon Invoke (powered by Microsoft’s Cortana) smart speakers, each with 800 queries, and found that Google Home answered 81% of the questions correctly vs. Echo at 64% and Cortana at 56%.

Did Santa bring you a smart speaker? Smart speakers are quickly becoming one of the most common consumer uses of AI thanks to aggressive pricing and marketing from companies like Amazon and Google. We’ve conducted our latest round of queries, designed to test the full range of abilities and accuracy of a given AI assistant. Our conclusion: home assistants aren’t just gaining popularity, they’re making drastic improvements quickly. Here is what you can expect from the smart speaker that you unwrapped yesterday.

Methodology. Just as we have in February and August of this year, we asked 800 questions to the Amazon Echo (2nd generation this time around) and Google Home. We added the Harman Kardon Invoke speaker, coupled with Microsoft’s Cortana assistant, to our evaluation. The queries covered five categories: Local, Commerce, Navigation, Information, and Command. The smart speakers were graded on two metrics: did the device understand what was asked? (this can be seen on the device’s companion app), and did it answer or execute correctly? It is important to note that we have slightly modified our question set to be more reflective of the changing abilities of AI assistants. As voice computing becomes more versatile and smart speakers become more capable, we will continue to update our question set to be reflective of those improvements going forward. Our changes included questions around the use of smart home devices. We tested each of the speakers with the Philips Hue smart lighting and Wemo Mini smart plugs.

This round, Google Home was the decisive winner, answering 81% of questions correctly vs. the Echo’s 64% and the Invoke’s 56%.  On average, the speakers understood what was being asked 99% of the time. This is a jump up from 95% in August and means that these assistants’ natural language processing has improved to correctly understand, apart from a few anomalies, everything you say. Whether or not it correctly executes your request varies widely between devices and categories.

Results. Google Home continued its outperformance with the top score in each of the five categories. The Invoke, powered by Microsoft’s Cortana, scored more or less in line with the Amazon Echo – an impressive feat considering its tiny market share and comparatively short time in the hands of users. The Echo made considerable improvements in several categories, most notably navigation, while remaining relatively flat in areas like commerce and local.

Improvement across the board. We continue to be impressed with the rate at which these AI assistants are improving. Since our first test in February, the total number of correct responses has increased by 29% for the Echo and 42% for the Google Home. Cortana, which we tested in April on a Microsoft Surface Book, has improved 8%. In less than a year we have noted remarkable improvement in every category and can only expect this level of progress to continue as adoption grows and user base expands. Google Home, however seems to be on the steepest improvement curve. One would expect Google to dominate the information category with its unprecedented access to search data, but its outperformance in categories like commands, navigation, and even commerce furthers the case, in our minds, for Google Home to steal market share away from Alexa going forward.

New features emerge. During our testing, we noticed several minor, but encouraging enhancements to the voice computing experience, namely connectivity to both other devices and other services. Excluding the Echo, when you ask for navigation information, Google and Cortana will send directions to your phone either through a push notification or the companion app. Hailing a ride through Uber was smooth on both the Echo and Google Home. The Google Home could also hand you off to a designated EBay assistant to shop for used goods. We were impressed with improvements around media services like Spotify and smart home capabilities using both lights and smart switches.

Google takes a commanding lead in commerce. Google Home correctly answered 72% of commerce questions, as opposed to 42% and 15% for the Echo and Invoke respectively. This is an area that is thought to be dominated by Amazon. However, Google’s recent anti-Amazon partnerships with retailers like Target and Walmart to make voice-based commerce more accessible pushed the Google Home ahead of other assistants. This was the Google Home’s largest area of improvement, correctly answering 34% more queries than it did in August. 

Sound quality. Overwhelmingly, smart speaker owners use them to call up and listen to music. According to Quartz data, 74% of owners play music through their smart speakers, more than asking for weather and basic info. Of the devices we tested, the Harman Kardon Invoke sounded the best; the Google Home and Echo are very similar, but are not focused on premium sound quality. For this mid-tier price range (sale prices – Google Home: $79, Echo: $79, Invoke: $99) the Invoke sounds best. Great sounding music, however, is less defensible than the AI itself. A useful assistant can be loaded onto a tiny speaker like the Echo Dot and Home Mini, or a premium speaker as we have seen with the Alexa-enabled Sonos One, Google Home Max, and the incoming Apple HomePod. It becomes clear that you are paying almost exclusively for sound quality.

Still not mainstream. Despite our comprehensive question set, the everyday user rarely extends beyond simple queries like asking for the weather, general knowledge questions, or requesting a song. In fact, 65% of Alexa users have not even enabled a skill. In order for voice computing to take hold in the home and beyond, there needs to be improvement in terms of connectivity with other devices like phones, laptops, and televisions. We did note much better connection to your phone via companion apps, your television via devices like a Chromecast of Fire TV, and better control of smart home applications, which is an encouraging sign. A short list of persistent issues keeps smart speakers in the camp of tech gadget instead of essential device (like a phone or computer), but at the rate of change we are observing, we remain confident that AI assistants, in time, will become an integral part of how we interact with computers.

Disclaimer: We actively write about the themes in which we invest: artificial intelligence, robotics, virtual reality, and augmented reality. From time to time, we will write about companies that are in our portfolio.  Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.

ARCore + ARKit Make Augmented Reality Ubiquitous

On Tuesday, Google released a developer preview of ARCore, a platform for developers to build augmented reality apps for Android. ARCore brings augmented reality to the world’s largest mobile operating system, starting with just the Pixel and Galaxy S8, but will expand to other existing and upcoming Android devices. The announcement comes on the heels of Apple’s ARKit, made available to developers in June. The introduction of both platforms blankets the mobile device market and will eventually make AR as ubiquitous as the devices themselves.

How does it work? Three basic components make up the technology that enables ARCore:

  1. Motion tracking – uses internal sensors and the phone’s camera to identify features and determine your position and orientation as you move through space
  2. Environmental understanding – detects the size and location of flat horizontal surfaces like tables and walls
  3. Light estimation – blurs the lines between the real and augmented world by helping virtual objects cast accurate shadows

What about Tango? Augmented reality is not a new area of interest for Google. Over three years ago, Google released Tango in an attempt to bring AR to smartphones and tablets.  Google’s custom hardware requirements, however, left Tango with little mainstream appeal. ARCore forgoes some of Tango’s power for increased accessibility. Fortunately for consumers, as AR becomes a core capability of devices going forward, hardware will catch up in the form of more sensors and better cameras, benefitting mobile AR as a whole.

Déjà vu. In July 2008, Apple opened the App Store with a total of 500 apps. One year later, it had seen over 2 billion downloads, and by 2011, the App Store was home to over 350,000 apps with 10 billion total downloads. The Android Market (later Google Play Store) was announced 3 months after the App Store, and although it had a slower takeoff due to smaller market share, it surpassed the App Store by 2014, both in terms of number of apps available and total downloads. The Google Play Store currently offers 2.8 million apps, compared to Apple’s 2.2 million. Just as smartphone apps erupted into existence, augmented reality will soon be a core technology available to millions of users. Google expects that by ARCore’s public launch, 100 million Android devices will support AR applications, and our research suggests over 200 million iPhones will become AR-enabled with the introduction of ARKit.

AR is here to stay. The two major device platforms are now wholeheartedly embracing and investing in augmented reality. Microsoft and Facebook have also heavily invested in AR’s future, further confirming AR’s position as a pivotal technology. We have previously written about the gold rush of AR applications on the App Store, which will only be amplified by the addition of ARCore. While the race for the pole position in AR heats up, there is one clear winner – the consumer. Aside from putting useful and fun new apps in our hands, expanding the user base of the underlying technology will accelerate the adoption of the next generation of computing.

Disclaimer: We actively write about the themes in which we invest: artificial intelligence, robotics, virtual reality, and augmented reality. From time to time, we will write about companies that are in our portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.

How the Future of Voice Search Affects Marketers Today

Written by guest author Lindsay Boyajian at Conductor

Since Amazon announced its acquisition of Whole Foods, the running joke across social media has been, “Jeff Bezos said to Alexa, ‘Buy me something on Whole Foods,’ and Alexa bought Whole Foods.”

This quip highlights the shortcomings that plague voice search. Today, voice recognition technology is very much flawed and often falls short in delivering on the user’s intent.

Despite its weaknesses, voice search is promising to be the user input of tomorrow. The major tech companies are investing heavily in the technology— Apple has Siri, Amazon has Alexa, Google has Google Assistant, and Microsoft has Cortana. Even with the technology in its nascency, Google reports 20 percent of queries on its mobile app and Android devices are voice searches.

And thanks to artificial intelligence and machine learning, voice search is improving quickly. It improves with every user interaction, becoming more apt at understanding user intent. With the technology advancing, more users will adopt voice search, fueling the growth cycle.

The work that is going into voice recognition technology today will power the next evolution in computing— augmented reality.

Augmented Reality & Voice Search

Augmented reality (AR) represents a new computing paradigm. Augmented reality overlays digital assets on the real-world environment. The technology promises to change how users interact with the digital world.

Soon, everything from office activities to shopping will be experienced through augmented reality. For instance, a shopper will be able to put on a lightweight pair of AR glasses to visualize in 3D what different couches will look like in her home. Some AR experiences like this are already offered today through head-mounted devices like Hololens and Meta. However, these devices are only available to developers and still have their limitations. They are not ready for mass consumer adoption.

The principal user input for augmented reality devices (excluding hardware input accessories like keypads and clickers) is gesture and voice. The issue with gesture controls is user discomfort and fatigue. Many experts agree that voice will be the primary input for these devices.

As the augmented reality space matures so will the importance of voice search.

The tech company with the most advanced voice recognition technology will have an advantage in augmented reality computing.

Optimizing Organic Search for the Future of Voice Search

Although mass consumer adoption of AR hardware is still years away, brands that optimize for voice search early will lead in organic and search marketing when the technology becomes ubiquitous.

Voice search behavior differs from traditional search patterns. Consumers approach voice search using natural, more conversational language. The queries are often longer and delivered as questions.

The result for marketers is that content optimized only for keywords will falter, while content that delivers value and matches the intent of the user will see improved organic search performance. To do this, marketers need to develop a deeper understanding of their customers to deliver content that provides relevant and timely value. This approach to marketing is known as customer first marketing.

Customer first marketing is not new. More and more brands are quickly adopting a customer-centric marketing approach. Relevant and contextual content drives traffic, fosters customer engagement, and builds loyalty. The rise of voice search and its link to the future of augmented reality only makes adopting a customer first marketing strategy even more advantageous for brands and marketers.

This piece originally appeared on LinkedIn. For more, follow Lindsay Boyajian on Twitter and LinkedIn

Disclaimer: We actively write about the themes in which we invest: artificial intelligence, robotics, virtual reality, and augmented reality. From time to time, we will write about companies that are in our portfolio.  Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.

E3 Leaves VR Fans Wanting More

Fans of virtual reality gaming didn’t hear quite as many announcements as they were hoping to last week at E3. While Sony and PC platforms announced some impressive titles launching in VR, Microsoft was silent about VR despite releasing the most powerful console to date. It was Nintendo however, that made a surprise announcement about its efforts in VR.

During its press conference, Nintendo unveiled that Mario Kart is arriving at a location-based VR with VR Zone Shinjuku, a 40,000 square foot arcade from Bandai Namco, offering 15 different VR games. The facility is set to open on July 14th. One of the most anticipated games to be showcased at the facility, Mario Kart, gives gamers the chance to sit in a go-kart and put on a VR headset, racing their friends virtually. This is Bandai Namco’s second foray into location-based VR arcades, after opening up “VR Zone Project I Can” in Tokyo last year.

Time will tell if Nintendo further adopts the location-based approach, and brings more of its games to the increasing number VR arcades across the world. Location-based VR is a great way to introduce VR to a higher number of consumers. These VR arcades help defray high costs, provide ample space for VR gaming, and offer a fun, communal VR experience. However, given the declining cost of VR gaming, we view this as stepping-stone technology that won’t be the final place for VR gaming. Eventually, VR gaming will be home-based, just as console video-games replaced arcades of the past.

In contrast to Nintendo, Sony continues to release VR content to its PlayStation VR console. At E3, Sony announced major titles in VR including Skyrim and Doom VFR. Previously, Sony’s VR titles were non-major titles that were developed specifically for the VR experience. Major titles reaching its VR platform is a big step forward for VR gaming and a positive indication for the space.

Microsoft has yet to bring VR gaming to the Xbox, instead choosing to place a bigger bet on Mixed Realty, focusing on their new MR platform for PCs coming this fall. When Project Skorpio was announced last year, it seemed all but a certainty that it was a move to compete directly with Playstation VR, and bring VR gaming to the Xbox One. However, Microsoft tempered expectations before E3. Microsoft’s Phil Spencer shared his belief that VR console gaming is typically done in family rooms and needs to have wireless headsets in order for it to be done right. While the newly announced Xbox One X is powerful enough to support VR, owners likely won’t see VR support until 2018. Until then, Microsoft remains focused on its Mixed Reality platform coming to PCs this fall.

Disclaimer: We actively write about the themes in which we invest: artificial intelligence, robotics, virtual reality, and augmented reality. From time to time, we will write about companies that are in our portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.