Voice technology, augmented reality and artificial intelligence aren’t just ancillary anymore; these efforts are a focal point and becoming critical to the core businesses of the tech giants — and areas of increasing interest for retail and fashion. Essentially, these tech companies are not relying just on individual gadgets, which makes sense since the results have been mixed.
Apple’s highs and lows are a good example. The company reported record quarterly revenue, as well as per-share earnings, thanks to the iPhone X, it said. But the news of its $88.3 billion in revenue, up 13 percent from the prior year, came alongside its disclosure of lower phone shipment volume. The company sold 77.3 million iPhones over the holidays, down 1 percent from the year-ago period. So what the device’s high retail price of $1,000 may have hurt in shipment volume, it seemingly made up in sales value, boosting the average iPhone price across all of its models to nearly $800. Last year, the average was approximately $100 less.
The company may continue fiddling with pricing and value propositions, like whether its neural engine — which relies on its AI-capable A11 processor chip — is a desirable selling point for consumers. But along the way, it is worth noting that its Siri-powered HomePod smart speaker is on its way.
The new product got some prized airtime on the company’s conference call on Thursday. In addition to waxing poetic about his Apple’s augmented reality tool ARKit and the slew of AR apps it enabled, chief executive officer Tim Cook also singled out HomePod. “Together with Apple Music, HomePod gives you instant access to one of the world’s largest music catalogs, and with the intelligence of Siri, it’s a powerful assistant you control through natural voice interaction,” Cook said. “We’re very happy with the initial response from reviewers who’ve experienced HomePod ahead of its launch, and we think our customers are going to love this new product.”
Now with the speaker, Amazon and its Echo product lineup land squarely in Apple’s crosshairs. The company may find, like Google, taking on Amazon’s dominance in the smart speaker space isn’t so easy.
Echo represents an interesting turn of events for the e-commerce giant. Amazon’s hardware efforts used to look like experiments at best, with some highs (Kindle) and notable lows (Fire Phone). Had the Echo failed, it would have been easy enough for Amazon to dismiss — especially with its juggernaut marketplace and cloud business, Amazon Web Services, stuffing its wallet. This week, the company reported that AWS revenues leapt 45 percent over the previous quarter, nabbing $5.11 billion.
But Echo and its Alexa voice assistant didn’t flame out — it ignited a new smart home race and dominated the market. The effort crosses numerous areas — from the Internet of Things to voice technology to AI, especially as it relates to Natural Language Processing. Amazon, swelling with $60.5 billion in fourth-quarter revenues, seems even more emboldened to dive further into large spread of vertical markets. With interests in fashion and beauty, supermarkets, cashier-less stores and, most recently, health care, it appears to be lining up as many consumer touchpoints as possible. The nuances of how the company will weave them together remain to be seen, but 2018 will certainly see it advancing the cause in ways big and small, and that will probably have some sort of hook into its Alexa tech.
“We had record device sales with very high levels of customer engagement, including increased levels of voice shopping, growth in functionality, growth in our partners we work with, skills that we’ve increased rapidly,” said Amazon’s chief financial officer Brian Olsavsky in a call with analysts. “We’re over 30,000 skills for Alexa.”
The Amazon speaker’s traction likely sparked Google to drive its Google Home appliances. And it’s made gains. Alphabet showed a growth in income from hardware covering its Pixel phones, Chromecasts and smart speakers. The company suffered $10 billion in tax charges and fell below analyst expectations, but its “other revenues” covering its cloud business and hardware revenue, did well. According to Google ceo Sundar Pichai, the company sold “tens of millions” of Chromecasts and Google Home devices last year.
In all, look for the companies to double down on an array of emerging technologies and advancements. That means 2017’s push into AR beauty apps, voice-enabled shopping and AI-powered services could be dwarfed by what 2018 brings.