Smart speakers are on the same path as smart watches

Last year, when my colleagues and I were trying out HTC Vive (virtual reality), we cursed while trying it out, and we were very excited.

At that time, we wanted to develop a "fuck index" for technology products, which meant that when trying out which technology product, the product that received the most criticism was representative. At that time, the HTC Vive's f*ck index was very high. Colleagues even scolded many small demos to the end - "fuck, there is such an operation."

This year, I read some media reviews of Nintendo's new handheld console Switch and "The Legend of Zelda: Breath of the Wild", and they also proposed a new term, which can be understood as "time freshness", which means that when you experience a product, the more you experience it, the more you discover that a new continent has opened up and you are deeply involved in it... Then its time freshness will be higher, that is, after using it for a long time, you will find that you can't live without it.

I think as long as the "fuck index" is high enough and the "time freshness" is high enough, a digital product may be more than half of it.

To be honest, when I was writing about various smart speaker technologies, products, and experiences today, it was actually very similar to how I felt when I was writing about VR (Virtual Reality) last year - "Fuck, shit, shit", "Buy, buy, buy"...

What is certain is that almost all Chinese Internet giants and artificial intelligence companies are trying to show off their skills in the smart speaker category, and this "visible", "touchable" and "hearable" hardware product is indeed far more reliable than "PPT artificial intelligence".

But are smart speakers really a product that can become popular once artificial intelligence technology is in place?

The intelligence and "time freshness" of the speaker are limited by how many smart appliances can be bound...

The intrusion of giants quickly heated up the speaker market.

January 2017: Baidu and Xiaoyu Home released a video intercom robot equipped with DuerOS;

June 2017: Tencent and Digital Jiayuan released the "Jianjian H2" equipped with Xiaowei;

July 2017: Alibaba launched “Tmall Genie X1” equipped with AliGenie human-computer interaction system.

Giant companies and speaker manufacturers have rushed to install speakers, which more reflects their determination to compete for smart home entrances and the big data behind them.

But even Dingdong speakers, which started laying out two years ago, and Rokid, which started its business three years ago, are not doing well enough in the C-end track of smart speakers. The reason does not lie in the speakers themselves.

On the one hand, it is the historical legacy of traditional speakers for Chinese consumers; on the other hand, there is a strong contrast between the home environment of Chinese consumers and smart speakers, and the scene elements are not sufficient, so naturally they cannot form a rigid demand.

It has nothing to do with the speaker's own qualities such as sound quality and recognition accuracy. The "time freshness" of a smart speaker depends on how many connectable smart appliances you have in your home. Only when there are enough smart devices in the home can the core function of "voice control" of smart speakers be effective.

The question of whether to buy a smart speaker has changed from "whether the speaker is good" to "how many smart devices consumers already have", "can these smart devices be connected", and "can they provide a better experience".

This actually has nothing to do with the artificial intelligence technology that most smart speaker manufacturers are trying to show off and want to demonstrate. Instead, it is a purely commercial issue.

Most ordinary people don’t have so many scalable marginal products in their homes. And even "geek homes" with enough smart hardware still face the problem of "taking sides":

I bought Tmall Genie, but it couldn’t connect to JD.com’s smart air conditioner; I bought Dingdong speakers, but it couldn’t connect to Ali Smart’s humidifier; I bought Qianjian H2, but it couldn’t connect to Xiaomi’s lamp.

The warlord war situation in the field of smart home in the past three years can be solved by "installing a bunch of control apps on one mobile phone". But manufacturers can never let users buy a bunch of smart speakers at home.

On the other hand, it is also very unrealistic to use a smart speaker with a unit price of about 1,000 yuan to restrict users to "only buy home appliances that cooperate with a certain platform."

Therefore, the "skills" of China's smart speakers can only remain in the areas of listening to songs, cross talk, and weather forecasts, which are painless and have no interest entanglements.

The fire in the West is not necessarily the fire in the East

In November 2014, Amazon Echo, the “grandfather” of smart speakers, was officially released. You can see that so many smart speakers and BAT’s competition nowadays are basically derived from this product.

The 2014 Echo was more focused on speakers, making it difficult to recognize it as an entrance to the home scene, let alone how many "wtf indexes" it had; the 2017 Echo turned aside and became a voice-based platform. According to reports, it has opened up more than 10,000 skills.

Perhaps, after all, he saw through Jeff Bezos' trick. Two years after the release of Echo, Google Home equipped with Google Assistant was officially launched.

In less than three years, the number of Echo units is approaching 10 million. According to a report released by market consulting firm eMarketer, approximately 70.6% of U.S. smart speaker users are Amazon users, while Google only accounts for 23.8%. It was the surprise attack on speakers staged by Amazon that ignited the Chinese consumer electronics market, which was seeking new growth points.

But in a large sense, the boom in China's speaker market is not just due to the emergence of Echo. At Apple WWDC in 2017, Apple officially launched the speaker product HomePod. This product focuses on sound quality and does not place too much emphasis on artificial intelligence and voice assistants.

"It is very smart for Apple to define its product in this way, because the dialogue speaker has no feeling at all for ordinary consumers. But if it is an Apple speaker product and focuses on the traditional concept of 'sound quality', it may attract more consumers' attention." A person in the speaker industry told PingWest.

In fact, what he talked about was a question of natural logic - from the habit of "buying speakers" to "having a speaker", and finally getting used to talking to speakers using voice. This is the logic of Amazon and overseas markets in making speakers.

But this is different from the current products that emphasize artificial intelligence in the Chinese market - in China, people rarely have the habit of buying a speaker every few years, and they rarely have time to pay attention to smart speakers; besides, artificial intelligence is an obscure technology, and there are still some problems with the Chinese voice technology itself.

In other words, the Western world is not "wtf" surprised by speakers. It is a natural process - smart speakers are derived from the natural extension of the traditional speaker category.

In the Chinese market, using artificial intelligence to package a concept for speakers and forcing a speaker to users who don’t need a speaker is completely different.

Overseas market research company Counterpoint Research has issued a report - 2 million smart speakers will enter the Chinese market this year, but they are still inferior to the 14 million units in the United States. We also used Jiguang Big Data to run a data report on mainstream smart speakers in the domestic market to reflect the current problem of smart speaker user share:

The main test is the installed capacity of apps for smart speakers currently sold. Of course, product rankings have a lot to do with app release time

Since all smart speakers need to be connected to the mobile app during initialization, we can observe the shipment level of smart speakers through the installation volume of the mobile app. As can be seen from the data in the figure above, the ranking of domestic smart speaker products is directly related to the time when the speaker is released. The product ranking is closely related to the time when the app is released. However, the installed base of Dingdong speakers (the App is called "Smart Speaker"), which was released two years ago and continues to launch new products, is only about 90,000.

Although this number does not entirely represent sales, it can be vaguely judged from an order of magnitude that the overall popularity of smart speakers in the past two years is not even as high as smart watches.

Smart speakers have not yet started to take off in the consumer market.

But, how long does it take?

"The intrusion of giants is actually a good thing, letting more people know that such products exist." "The functions that can be realized are still limited at present, and we will continue to polish the boundaries." "The functions will become more and more perfect with product upgrades." "We have to be patient and wait for the explosion of this market..."

This is the answer given by almost every speaker company when asked the question "How do they view the tepid Chinese speaker market?"

Speaker business owners and market research institutions both believe that the Chinese market will have to wait until the smart speaker market explodes, possibly in the next year or so.

PingWest Pinwan also counted that although all BAT platforms are deploying artificial intelligence and smart speakers, so far, there are only about 10 products in the hands of consumers.

You know, consumers never pay for technology. This year, the growth of AI technology will ultimately fall on consumer hardware. More hardware will be used to acquire more consumers. Consumers will pay for products, and product companies will pay for technology, ultimately forming a virtuous circle.

In the early stage when the market has not started to take off, consumers have no special concept of smart speakers, and giants have intervened in the market to educate consumers, "sustaining it" may be the only answer that every speaker company and manufacturer can give.

Of course, "going on" is nothing more than having money to sustain it - either continuing to raise funds to raise valuations, or increasing revenue and cutting expenditures to continue to polish the product experience and continue to expand the application of speakers in home scenarios, until the speaker market explodes and consumers recognize it.

But can these problems of high valuation, low sales, and inability to be monetized withstand the massive influx of capital, companies, products, and entrepreneurs in the speaker market that we don’t know when it will become popular? There are too many uncertain factors, and the final result is unknown.

In those years, the products that finally boiled into bubbles...

Speaking of "sustaining it" and whenever I think about smart homes, it reminds me of those products that have become a technology bubble.

Two or three years ago, smart hardware became popular, but it has receded again. In essence, traditional hardware + WiFi was given the name Smart. In fact, in the end, it was discovered that it was basically a false demand - people were not willing to use a mobile phone to control smart homes, and for the public, the acceptance of smart hardware was not high, and those companies became a big bubble.

Last year, the reason why VR became a bubble was that the technology was insufficient, the product application scope was too narrow, and the experience was not good enough; on the contrary, the product prices were high, the company valuation was too high, and too much capital entered, all entering the entrance but no exit, forming a huge bubble;

This year, AI talents have a tendency to become a bubble again - talents are too expensive, companies are overvalued, but the specific needs they can achieve are not proportional, they cannot reflect civilianization, and they cannot form widespread value. C-end companies may form another bubble;

I want to focus on the elements that fit the bubble:

A large number of them emerged in a short period of time - on the issue of speakers, due to the opening of the BAT technology platform, a number of technology start-ups have emerged, but the overall core technology is still controlled by others; a large number of box products have emerged. If all three BAT companies compete, there will be cannon fodder in the end, and those who fall will be those entrepreneurs who use technology shells.

Input and output are not directly proportional - making a good product is essentially a process of technology output; a company that makes speakers is essentially an artificial intelligence company. Technology must be applied to products so that more consumers can feel the value. If there is only superior technology, but it does not bring more consumers in the end, the technical energy invested will become a bubble.

In essence, dialogue speakers are actually hardware + voice (AI technology). From the current point of view, AI's improvement in voice interaction itself is still limited. C-end users have not adopted it in large numbers, and it has not yet formed a wide range of scenario applications.

From technology maturity to product application, if the product is not used by large-scale consumers and does not have continuous "time freshness", it may become a short-lived trend...

Actually, I have a smart speaker

As a practitioner in this industry, I really have a smart speaker at home.

A few months ago, I found the founder of a smart speaker company and purchased one a few days before it was launched. Regarding the efficiency improvement of voice technology - now I have basically developed the habit of using this product to listen to music and play news. Every morning I say "xxx, play news!", "xxx, play lyrical music."

So far, I think it is the company that makes the best products - both the appearance of the product and the overall voice technology experience can give a very high "fuck index". I have indeed developed some habits of voice wake-up; but it is limited to this, and the part of building a smart home is not so smooth. It requires me to replace all the traditional appliances in the home, which still have to be directional. Over time, it stopped here, no longer "fresh", and more like a "traditional speaker".

This reminds me of the first Apple Watch I bought back then. I adjusted all the settings and notifications, but in the end, it was reduced to a "traditional watch" that I charged every day.

The fate of smart speakers may be the same as that of smart watches lying around gathering dust. It is a pity to discard them if they are of no use.