Since Google launched its smart speaker artificial intelligence (AI)-backed voice assistant product Google Home in November 2016, the state of the race for voice ecosystem dominance has been relatively consistent for the last three or so years. Amazon — with a head start of almost exactly two years with its Echo/Alexa line — has been the leader in the market, with Google running as fast as possible in second place trying to catch up.
On the whole, it hasn’t been a close race. Though there have been the occasional spots where it looked like Google might have some chance of pulling ahead, Amazon’s lead has remained fairly commanding and complete. As of early 2019, Alexa had 56,750 skills on offer in the U.S. market, compared to the 4,253. As of the start of summer 2019, Amazon also led Google in placing its voice-activated Assistant Alexa and far more third-party devices. Alexa is found in more than 60,000 smart home devices from 7,400 companies, whereas Google Assistant is found on about around 10,000 devices from more than 1,000 companies.
However, if Google has been somewhat slow to make any significant strides at taking pole position in this race — it has held on to second place reasonably consistently, and not for lack of serious challengers. Granted Samsung’s Bixby was differently focused and Apple’s HomePod/Siri combination has suffered from execution issues since it was announced, both of which made it easier for Google to remain the main competition of Amazon in the race.
The Race Heats Up
However, this week, it seems the equilibrium in the field has been disrupted — as new data out from Canalys indicates. Google is no longer holding the No. 2 spot — the silver medal in the voice speaker/assistant race is now China’s Baidu, while Google has slipped to No. 3.
Amazon still holds the top spot in the race — with 6.6 million units shipped during Q2 2019. But Baidu, during that time, surged into second, selling 4.5 million units and edging out Google’s 4.3 million. That growth, year-on-year, is on the order of 3,700 percent for Baidu.
All in, Q2 was big for voice-activated assistants in China — with 12.6 million unit shipments overall — more than double the 6.1 million sold in the U.S. during the same time period. Growth in the U.S. overall was weak in Q2 and declined slightly from Q1 by 2.4 percent. Baidu, on the other hand, leveraged a successful go-to-market campaign to bring a massive surge of Chinese consumers into the market for the first time. Baidu was particularly successful with the same of smart displays, which accounted for 45 percent of the products it shipped.
“Local network operators’ interests on the [smart display] device category soared recently. This bodes well for Baidu as it faces little competition in the smart display category, allowing the company to dominate in the operator channel,” noted Canalys Research Analyst Cynthia Chen.
Google, by comparison, has struggled with the rebranding of its smart display product, The Nest, during Q2. The report goes on to suggest that Google’s smart speaker products are all in need of a redesign and upgrade since the Home Device is unchanged since launch, and at the mini has only added a handful of new colors but is otherwise the same.
“Google urgently requires a revamped non-display smart speaker portfolio to rekindle consumer interest,” Canalys Senior Analyst Jason Low said in the report.
Moreover, the report notes, more China-based competition in the market is very likely headed Google’s way. Alibaba is currently in fourth place in the global smart speaker race — with about 15.8 percent of the market. Google is still ahead — but with an increasingly narrow lead as it currently holds about 16.7 percent of the market.
More Enter The Race
International sales, notably, are essential to Google Home and its Home Assistant — 55 percent of Google’s device shipments in the U.S. were outside the U.S. in Q2 2019 — up from 42 percent a year ago. However, as international sales are a boost for Google, foreign competitors present a new hurdle. Baidu has already shot past them — though they are a China only company, and it remains to be seen if they can hold onto that No. 2 spot on the strength of a single market.
However, Alibaba is increasingly a global company — and one that has begun pushing very avidly into the world of voice backed commerce through its proprietary device. They are coming up quick — and Google would likely be wise to pay attention to the sounds of its footfalls behind them on the track.
All the news, however, hasn’t been bad news for Google Home or it’s voice assistant in the last week, however. Loop Ventures released its latest comparison of virtual assistants last week and found that Google — once again — is the smartest virtual assistant in terms of answering user questions correctly and appropriately. Google was the only voice assistant tested that got an uncurved A — answering 93 percent of the 800 questions it was asked correctly with no confusion over questions. Siri got a borderline B with an 83 percent, and two questions misunderstood. Amazon’s Alexa asked 80 percent of questions correctly and misunderstood one.
The most significant gap was on commerce related queries — with Google Assistant standing out as a clear winner. Google Assistant correctly answered 92 percent of requests while Alexa had a score of 71 percent and Siri 68 percent.
Google, it seems, has built the brightest out of the box smart assistant most readily able to complete commerce tasks without issue.
However, will that matter?
The pace of the race is picking up and while Amazon is holding on to its lead and even growing it, Google has already been passed this quarter and is looking to get passed again in the not too distant future.
Moreover, it doesn’t matter how smart the Google Assistant is if enough people aren’t stopping in to chat.