December 2, 2022
Amazon is on track to lose $10B on its devices group, which includes Alexa, and massive layoffs have been announced targeting the Alexa team. Google Assistant Actions and Driving Mode have been shut down amidst rumors of layoffs and re-prioritizing the Google Assistant and AI functions to make their in-house hardware better.
Samsung barely made it out of the gates with their Bixby Assistant, which has been rumored to be on the chopping blocks forever, even after acquiring VIV to rejuvenate its life. Apple’s Siri has been the critique of the press and most performance analyses over the past years, and publicly traded companies like Cerence and SoundHound are reporting poor performance (Cerence annual sales are dropping and SoundHound is losing so much money it’s hard to predict if they can independently survive).
So what’s my take on what’s going on with Voice Assistants?
- The big guys wanna be like Apple! The VC mantra in the early years of the internet was that US companies couldn’t compete in hardware. Then Apple came out with the iPod and US companies tried to follow and play in consumer electronics. When Apple introduced the iPhone in 2007 and followed by acquiring Siri in 2010, it gave the full steam ahead green light to US consumer electronics and the use of voice assistants. Amazon, Google, Snap, Meta and others have all followed suit with aggressive hardware moves and investments in voice assistant technologies. Apple probably played its cards right by focusing on winning hardware and not over-investing in Siri. Amazon had to invest big in voice assistants because they didn’t have a seat in the mobile OS space where voice traction would have been much more accessible. Google is still doubling down on hardware at the expense of others in the Android mobile community. Samsung has always done great hardware, great marketing, and mediocre software and they would have a real edge if they played to their advantage and realized that Google was not their friend.
- Growing economy and valuations hide a lot of issues. It was easy for Google, Meta, Amazon and other large players to over invest in voice assistants and hardware when their stock price kept rising with their revenues and profits. But they were overpaying in salary wars to bring more people on board. Some of the offers that were made to people I know were just crazy, including signing bonuses that could buy a home.
- It’s hard to compete with free. Businesses must make money to survive. Google has this amazing advertising chest that can fund everything it wants including free assistant use. Amazon has Prime, Cloud and more. It’s no wonder that independent players like Sensory, SoundHound, and Cerence have been challenged to compete with the big guys.
- Data is still king! Sensory has seen the cost of data dropping and dropping. Scraping the internet for good data has gotten easier and many data-focused companies now compete for orders. Nevertheless, Amazon and Google got in early, collected domain specific data, and now have a big advantage in the domains they have collected. Companies in every market segment whether automotive or medical, should be collecting as much data as they can that covers the dialogs of their customers. This will give them a proprietary advantage and can work across the engine of their choice.
- The times they are a changin’. The biggest players are now scaling back, while many large players are realizing they need their own in-house voice stack and small team. The wide availability of open-source technologies, deep learning trained engineers, data base accessibility, and new inference engine hardware is changing the game, and making a technology stack as good as or better than Amazon or Google quite feasible. Additionally, this can be accomplished at a fraction of the price with orders of magnitude less people. Companies like Sensory have done all the work and are offering source code licenses and custom implementations so relying on a giant competitor or a precarious supplier is not necessary.
In a future blog we will discuss how these assistants are performing, according to the user. We’ll compare Sensory’s STT to Siri and review the data on how Sensory stacks up against the some of major players highlighted in this blog.