Last February, NewtonX interviewed a group of 15 current and former senior executives from leading global tech companies including Amazon, IBM, Apple, Samsung, and Microsoft to determine what place the smart speaker will hold in the technology ecosystem of the future. As we wrote at the time, 67% of the NewtonX panelists declared that their company was ready to take a loss in the space for the next 2-3 years in order to capture market share. Now, a year later, the voice market ecosystem has matured and expanded beyond smart speakers into a $49B opportunity.
NewtonX conducted a follow-up interview series with the same executives who informed our report on the subject last year, in addition to five executives at different tech giants who have entered the voice market fray. The data and insights in this article are informed by these interviews.
From Healthcare to Vehicle Integration: The Biggest Tech Giants Are Battling It Out For Voice Market Share
This past year has been huge for voice applications in the healthcare sector. Where previously, Amazon had only hinted at this as a use case for Alexa, now the company is actively battling it out with Google for healthcare voice applications. This year, Google’s investment fund, Google Assistant Investments, seeded Aiva Health, a voice operating system or hospitals and care centers. Additionally, Google partnered with Novant Health so that Novant Health patients can access office wait times, appointment reminds, directions, and FAQs through Google Assistant. One of Google’s primary focuses for overtaking Amazon in the sector has been language capabilities: the company is releasing voice in over 30 languages, including combinations of languages (such as ‘spanglish’).
Meanwhile, Amazon has been making major plays in the healthcare sector across its product offerings, including Alexa. Only 30% of smart speaker owners use them for shopping, and in 2018 only 2% of Echo users tried to make purchases via Alexa, meaning that for Amazon to hold a clear advantage over competitors, it needs to offer more than just ease of voice access to amazon.com. Consequently, Amazon hired a health and wellness team within its Alexa division last year, with the intent of offering diabetes management, elderly care, and medication reminders through HIPAA compliant integrations. While the company has yet to unveil these product offerings, but likely will in the next two years.
Instead, Amazon rolled out Echo Auto, which according to the company has over 1M pre-orders. This service allows users to tap into Alexa while on-the-go, for anything from making calls, to listening to music, to getting directions, to controlling smart home devices. Vehicle voice systems will likely be one of the most popular applications of the technology. Amazon has a unique advantage in the space due to its Amazon Connect Kit (ACK), an SDK for home IoT devices.
While Amazon and Google are the biggest players in the market, Apple, Microsoft, and even Facebook are also each making plays for the voice market. Apple, an early pioneer with voice through Siri, is now teaming up with Salesforce to build Apple voice technology directly into apps, so that users don’t have to navigate between systems. Microsoft, on the other hand, has opted out of the competition by teaming up with Amazon in a strategic partnership that benefits both tech giants. Similarly, Facebook teamed up with Amazon through Portal, its hands-free smart speaker and smart camera/video product. Portal interfaces with Alexa for users to access skills, meaning that Facebook cannot collect user data — a smart move considering user distrust over Facebook’s data handling.
The Future of Voice: Smarter, Integrated, and Multifunctional
Google and Amazon are and will likely continue to be the two primary voice market leaders. While Google is currently ahead in terms of NLP accuracy and languages (Alexa supports only three vs. Google’s 30), Amazon still has the greatest market share. That said, the company has rapidly been losing ground to Google: In 2018, Amazon’s global market share dipped from 76% to 41%, while Google’s rose to 28%. This represents 449% growth for Google and -14% growth for Amazon.
As the two tech giants battle for market share, they will form more and more integrations with other services, such as IoT home devices. Meanwhile they will also use the sophistication of their technology as a competitive advantage, which will result in smarter and smarter voice systems.