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This Article is From Oct 02, 2017

Amazon Leaped Ahead on Gadgets by Losing the Smartphone War

Amazon Leaped Ahead on Gadgets by Losing the Smartphone War

(Bloomberg Gadfly) -- In case it wasn't obvious before Wednesday, Amazon.com Inc. has leapfrogged the smartphone to go after the next era of computing. The company never could have done this if it hadn't been steamrolled in smartphones first. 

The way-more-than-a-retailer unveiled several new or revamped versions of its Echo voice-activated home speakers, including one that serves as a digital alarm clock, and it cut the price of its flagship gadget to $100 from $180. All these devices are Trojan horses rolling Alexa, the voice-commanded brain of the Echo devices, into your home. 

Alexa can already help you watch web videos, turn on kitchen timers, listen to music, shop on Amazon and do other tasks people do with smartphones run by Amazon archrivals Google and Apple Inc. 

Also Read | Layoffs Are Rising In Tech, But These Skills Are Helping People Unlock Better Pay

Amazon is eager to have Alexa do much more. Want it to be your TV remote control? Sure! Or Amazon promises that with a single command Alexa can take over your morning routine of flipping on the lights, turning on the coffeepot and firing up your wake-up jams. Want Alexa to control the 1990s novelty gift "Big Mouth Billy Bass"? Alexa will be able to do that, too. And it won't question your taste in home decoration, although I certainly will. 

Amazon is building a future untethered from the smartphone, but with all the software intelligence of that gadget and more -- with the company at the center. Amazon can embrace this future because it lost the recent past. Its Fire smartphone fizzled, giving it the freedom to define a new mode of computing that played to its strengths.

Each Alexa-powered Amazon device seems carefully calibrated to optimize a specific task at home. The Fire TV is for entertainment, the Echo for music, the Spot for morning and nighttime routines, the Echo Show for communication, and so on. The company made an operating system for the home, where Amazon's phone failure doesn't matter as much.

Notice what all this hardware has in common: They are branded drug-delivery mechanisms for more Amazon products and internet offerings. It's possible to use Alexa-powered gadgets without interacting with Amazon, but it's not easy. The default option for buying stuff through the Amazon devices is Amazon. The default option for renting movies on Fire TV is Amazon Video. And hey, wouldn't you love to join Amazon's Prime shopping club while you're at it?

This isn't unique to Amazon. People who buy a Google Home speaker or an Android smartphone are instantly part of Team Google. Google will try to steer them to root for YouTube, Google Maps, Google Assistant and Google Photos. Apple smartphones funnel people to buy iPads, Apple Watches and Apple Music subscriptions. Hardware is a conduit for technology companies to bore their ways into our lives and stay there. 

Number of Alexa-Powered Amazon Devices 

More Than 10

There are no guarantees Amazon's smartphone-free operating system will win. The dominant form of computing is still the smartphone. Billions of people own and rely on their phones, which are only growing in importance as the hub of people's digital lives, in the home and outside. By comparison, "tens of millions" of Alexa-powered devices are in use globally, an Amazon executive said Wednesday. 

So the jury is definitely still out. But every counter move by Apple and Google has reinforced Amazon's view of computing beyond the smartphone screen, where voice commands and smart digital helpers are the main modes of interaction. On those terms, Amazon is a combatant on equal standing, not a smartphone-less laggard.

A version of this column originally appeared in Bloomberg's Fully Charged technology newsletter. You can sign up here.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

Shira Ovide is a Bloomberg Gadfly columnist covering technology. She previously was a reporter for the Wall Street Journal.

To contact the author of this story: Shira Ovide in New York at sovide@bloomberg.net.

To contact the editor responsible for this story: Daniel Niemi at dniemi1@bloomberg.net.

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