Amazon Pushes Further Ahead of Apple, Google and Microsoft with Alexa

Posted on December 26, 2017 by Brad Sams in Hardware with 53 Comments

With the majority of the holiday shopping season now behind us, we can take a high-level look to see how various companies performed during the season. Specifically, when it comes to digital assistants, app installs are generally a good benchmark of performance.

Looking at both the iOS app store and Google Play, Amazon appears to have had a home run of a holiday season with its Alexa app topping charts for both platforms. Google has a Google Home app that is at the number 6 position for top free apps for iOS and number 2 position on Android, indicating that its hardware also sold well this year.

There are also two other players, Microsoft and Apple and the story is quite clear here. Apple’s hardware isn’t available which means it missed out entirely and Microsoft doesn’t appear to have performed much better with Cortana not showing up on either app store top free list.

Amazon, who is clearly happy with the results, pushed out a press release saying they sold millions of more devices this year but they don’t provide any hard numbers. Google hasn’t said anything at this time but its performance in the app stores show that it sold quite a few devices as well.

What this means is that as of now, the smart speaker market is still a two-horse race with Amazon clearly leading but Google is making inroads. Cortana, with the Harman Kardon speaker, does not appear to be selling well this year which further plagues on Microsoft’s issue of expanding the assistant’s footprint outside of Windows 10.

I’ll be curious to see how well Apple can play in this market when they finally get their Home Pod out the door and of course for Microsoft, they seriously need to work on a new strategy here as this year was another failure for Cortana when compared to Alexa or Google’s products.

The strong sales were likely fueled by low-cost products like the Echo from Amazon and Home Mini from Google that can be found for under $30 whereas Microsoft’s only product with Cortana is at least $99 if you grab it on sale. Apple and Microsoft both have iOS/Windows to keep their fan base connected to their assistants but smart speakers are quickly showing that this method significantly increases engagement with the services.

The next few years will be critical for these digital assistants as ambient computing becomes more popular and while the race is far from over, Microsoft and Apple are finding themselves well-behind Amazon and Google. Apple will likely be ok in the long-term as it sells millions of iPhones every quarter which promotes the use of Siri but Microsoft, even with Windows 10 adoption growing, has yet to move Cortana outside the walls of the desktop OS with any meaningful success.

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Comments (57)

57 responses to “Amazon Pushes Further Ahead of Apple, Google and Microsoft with Alexa”

  1. Avatar

    PeteB

    "Microsoft's only product with Cortana" isn't even a Microsoft product. It's a Harmon Kardon and it costs $199. Even at occasional $99 firesale pricing they can't get rid of them.


    Cortana isn't even on the consumer radar. People just ignore it on Windows, and MS abandoned mobile.

  2. Avatar

    SenorGravy

    I stopped off at Best Buy today and was going to buy a new Invoke for $99.


    Then I caught myself.


    This product has "future abandonment" written all over it. I can actually see Microsoft letting this product languish in the market with super slow or, most likely, "never" updates driving extremely poor adoption.


    Then, 18 months from now, Microsoft will simply walk away, and I'd stick it in the linen closet where I keep my Zune HD, Windows Phone, Surface RT, and Microsoft Band.


    So...no thanks, Microsoft. Fool me once...er.....four times....

  3. Avatar

    jrickel96

    Amazon missed its marks by a long shot from what I've been hearing. They're spinning it as "good", but they failed to get anywhere near industry projections. Another huge problem is the attach rate for smart speakers stinks. Less than 30% of new users will continue to regularly use them after the first month. Amazon slashed prices numerous times leading into Christmas and still failed to meet projections. Did they sell millions? Sure did. But the projections of selling over 20 million Echoes for the year did not happen. The data indicates they saw small gains from last year. That means bullish projections of over 60 million households having these type of speakers by 2022 are not likely to happen and decline is likely to start next year.


    Usage rates are still abysmal for this tech and Alexa is still the least used of all the assistants. Yes, it is the most used by those that actually have it, but very few people actually have Alexa, even with the app doing well for a short time. Google Now, Siri, and Cortana are all used more frequently in total.


    In short, Amazon is WAY BEHIND everyone, not way ahead. Alexa is primarily only used on speakers and the install base is very small. The smartphone usage is small and last data I saw, Cortana has more users. Google Now has the most users by a very wide margin.


    Alexa is doing okay. But hardly way ahead of everyone. No one really uses ANY of these things with regularity.


    The fiction of Alexa success is predicated on people taking a study from earlier in the year that showed Alexa was installed on 2% or less of all smartphones (lower install rate than Cortana) and showing it had the highest usage rate amongst the install base. 37% of 2% is not an impressive number. When you dig into that study, only 2 out of 2000 used Alexa regularly. People really need to dig into these things.


    This means that if you have a billion smartphone users, Alexa would be used daily by 740,000. The number I've heard from data collection is that Alexa has less than 1.5 million unique users on a weekly basis and under 4 million per month. That includes smart speakers.


    In short, Alexa is a service no one uses. The attach rate on smart speakers is around 30%. No one sticks with Alexa on their smartphone. Cortana is more successful just by being in the Windows 10 search bar.


    Alexa is not doing well, despite what Amazon would like you to believe. None of these digital assistants is doing very well.


    Not sure how Amazon is ahead when it's pretty clear this train is going nowhere. Digital assistants as they are are not the future.


    And Millennials would prefer to type on their phones rather than speak to them.

    • Avatar

      kcarson97404

      In reply to jrickel96:

      "No one really uses ANY of these things with regularity."


      That's quite a blanket statement.


      My family uses Alexa very reguarly-- multiple times a day.


      We have now 6 different Echo devices. We use it to play Spotify, now across all devices in the house. It is the primary device we use to control our smart home lights. We set reminders using it. My wife sets timers on it when working in the kitchen. We use the shopping list feature all the time. The "drop in" feature works so well as an intercom in our house that we picked up 2 more Echo Dots just so we could intercom from the basement to the upstairs. That doesn't even count the ocassional question to Alexa or the flash breifing, or the audiobooks, or the quick game of jeopardy. We love it.


      I rarely use Google Assistant on my phone, nor Cortana on my PC. It's just inconvenient to have to be near or find a device when I could just call out from anywhere in my house, "Alexa!"


      And I'm not alone. Granted this is anecdotal, but Alexa has the mind share with my co-workers and friends. People are talking about their Alexa all the time.


      I agree with Paul that this is Google's market to loose. But Siri is still a joke to most people, and nobody even knows who Cortana is. But I can tell you in our house and among my associates, Alexa clearly is winning at this stage of the game.

      • Avatar

        jrickel96

        In reply to kcarson97404:

        The percentages compared to smartphone and PC installations are clear - no one uses Alexa. Sure, 2 million active monthly users isn't "no one", but in such large markets, it is.


        I know of no one with Echo devices that uses them regularly - and I spend time with younger, tech savvy crowds. I know two people that use Google Home regularly. That's my anecdote.


        But when you look at market research, it's apparent that as a tech product, personal assistants are rarely ever used. As for Echo, most users are like you. There are diehards that buy several devices, but new users that actually use the devices are not as common now. There's very little growth in the userbase.


        I actually expect Amazon to stop developing Alexa within two years. No one uses it - not enough to continue to invest so much money into development. The market research from Christmas shows that this is not a growth market and Amazon's penetration s not leading to revenue increases. Alexa and the personal assistants are not the next big thing and I think that's clear now.


        I think we'll see a big rollback in the smart speakers by this time next year and Amazon will stop selling Echo devices in two years - or they will charge to use Alexa as a service. For Amazon, charging for Alexa via monthly subscription is the only way to go long term. It's not producing the data points for them nor driving retail revenue. For Google, MS, and Apple, these considerations are less important. That's not the case for Amazon. I've even heard some associates from Seattle that deal with Amazon regularly talk about how upset Amazon is with how poorly received Alexa has been - they were hoping they had the next big thing. They clearly realize they don't. They had to firesale them this Christmas just to move them.


        My advice would be to enjoy Alexa while you can. The writing is on the wall. I don't expect Amazon to maintain Alexa for much longer unless they shift to a subscription model. As the smart speaker begins to decline next year, it'll become more apparent. I've already heard talk of Amazon considering offering a Prime upgrade so users can pay for Alexa.

  4. Avatar

    Boris Zakharin

    What a strange roundabout way to compare sales. You don't actually need a smartphone app for any of these products except Google Home. How many smart speaker owners don't have (or don't want to use) a smartphone?

  5. Avatar

    Markyjns

    Over here in the U.K. Alexa is everywhere, in my office of 14 people, 9 now have at least two Alexa devices, 7 of those 9 have installed smart lights and or harmony hub and or other smart devices which they use Alexa to control. None of the 14 have a google device, all bar 2 are Android phone users.


    In John Lewis, a major respected department store, Alexa always used to be displayed next to the Kindles. 4mths ago I went in and to my surprise found they had ‘gone’. Turns out they had set up a dedicated smart home area, with all sorts of items being controlled by Alexa devices. They also now stocked Google’s home thing....by itself and not part of the connected home area.


    Of those 9 who had an Alexa device 6 were buying further Alexa devices for relatives for Christmas.

    Myself I bought one for my parents, the voice activated drop in calling facility being a big driver, 2 others I know have done the same thing for their parents. My partner has just done the same for his brother and also his mother.


    Ok all of this is entirely anecdotal and could easily just be a localised blip but I get a feeling that in the U.K. Alexa has caught on in a way that Google so far hasn’t.

  6. Avatar

    will

    I picked up a Sonos One just before Christmas and I feel they are in a good position going forward. An amazing sounding speaker that right now works with Alexa, but will soon work with Google and maybe others in the future. I agree that the attach rate for home assistants is very low. Basically they are just voice driven command line interfaces and while controlling your lights and stuff is good, it needs to be more proactive/productive.


    The biggest problem it seems right now is for Microsoft. Yet again they are late to market and no one is really running to get one. I tried one for about a week and it went back. While Cortana sounds great, the device was slow to do any sort of home automation stuff and the ecosystem is just limited with Cortana. I mean why can I not so the same thing from an Xbox?


    It feels like the Invoke will be like the Microsoft Band, while good no one is buying them in large numbers and others will win....AGAIN.

  7. Avatar

    glenn8878

    Amazon blew it without YouTube support so there’s still a fighting chance if anyone can get a fully integrated system in place. I’m not counting on Apple or Microsoft to close the gap. They have other priorities and MS painfully got out of the music business. It’s a two way horse race between Google and Amazon.

  8. Avatar

    ponsaelius

    I have an Echo. Not being in the USA means Microsoft products arrive months or years later. Many times they don't arrive at all.


    This can be an advantage for non-US customers as they are normally abandoned before we see them and pay for them. Zune and band are in that category.


    Windowsphone sold in double digits of percent in most European countries and because Microsoft could not sell it in the US was abandoned globally. That time we got the chance to buy Microsoft abandonware.


    Microsoft are developing a global reputation for abandoning consumer product. It may even affect future products they might want to sell.

  9. Avatar

    zybch

    I went google this time. With the midrange device for the lounge and the mini for the bedroom (another for elsewhere will be coming soon). I don't trust the company, but I've come to the conclusion its pointless to resist at this stage :( plus the google home eco system seems the best and also the services you can use without having to pay extra for subscriptions (music/prime/etc). So farm I'm pretty impressed - we are living in the future indeed.

  10. Avatar

    wolters

    As I've stated in other comments, I just left the Echo ecosystem for Google Home (a combo of Mini, Home and Max) and it just flows better with my phone and daily life. In addition, I use YouTube Red with Google Music Family plan, so no need for multiple music services.


    Amazon has a fantastic ecosystem if you want to go "all in", especially with Prime. I still use Prime, Prime Videos, Kindle, Audible and I'm a Vine Reviewer. If Amazon can make some inroads to making it flow better (calendar, reminders, etc) and have a "Max" quality Echo speaker, I might consider it in the future.


    But for now, Google Home/Assistant wins for me.

  11. Avatar

    dcdevito

    Amazon can only go so far. Without a true computing platform, I don't see how they can succeed in the long term. Google Home is hands down a better product. Google's AI is leaps and bounds better and way ahead right now and it is quickly showing.

    • Avatar

      wolters

      In reply to dcdevito:

      Now that I've migrated from Echo to Home, yes, I can wholeheartedly agree that Google Home is fundamentally better. It still has SOME catching up to do in areas (it's version of Flash Briefing could be better) but it is far ahead in the important areas. I'm glad I made the switch, even if my tin foil hat bugs me at times about Google.

    • Avatar

      jrickel96

      In reply to dcdevito:

      Just take a look at the app ratings. Alexa does very poorly in iOS and Android. Google Home actually has a good rating on iOS.


      The Google Home has more real life usage and Google's AI is much better. Even so, the amount of usage is still very small and without massive growth, I suspect Google will EOL the Home line of speakers. I doubt it gets them enough data to increase their revenue.


      Remember that Google is all about collecting as much data on you as possible to push ads to you. They need to increase their ad push to make money. Amazon needs to sell you someone else's product, so they also need to have you buy stuff.


      Only Apple and Microsoft actually make money on the things they make. MS is much more productivity focused, but they are selling you something you can use - and something many people actually use to make money themselves. Google and Amazon are not so empowering. Nor is Apple.


      I see only a niche future for these speakers and for the assistants. Ambient computing will happen in other ways, not this way.

      • Avatar

        wolters

        In reply to jrickel96:

        " Even so, the amount of usage is still very small and without massive growth, I suspect Google will EOL the Home line of speakers. I doubt it gets them enough data to increase their revenue."


        And this is why I'll keep an eye on this so I can sell my Google Home Max for top dollar in the event I need to move back to Alexa or just go all Sonos or Bose. But for now, I really do like the "Home" Ecosystem.

    • Avatar

      Skolvikings

      In reply to dcdevito:

      You guys could be correct that Google Home is better, but my Echo devices work great. I can turn my lights on and off. I can play music from Spotify or SiriusXM or TuneIn. I can find out what the weather is going to be and my kids can ask Alexa to tell them light-bulb jokes. I don't know what else I'd really want to do with it.


      As for a computing platform... AWS? I mean, Amazon is the top player in cloud computing at the moment.

      • Avatar

        Skolvikings

        In reply to Skolvikings:

        I forgot to mention, and this has surprisingly been something I use more than I thought I would, I can control my FireTV with my Echo Dot. We "cut the cord" and use a combination of Playstation Vue, Netflix, Hulu, and CBS All Access. (Yes, we still save money.)


        PS Vue, Hulu, and CBS are Alexa enabled. So I can say things like "Watch ESPN on PlayStation Vue" or "Watch Last Man Standing on Hulu" and it will launch the app and tune to that station/show. I can say things like play/pause/fast forward 4 minutes, and it does all that. It's actually quite nice when watching a DVR show on PS Vue and fast forwarding through commercials, etc.

  12. Avatar

    John Scott

    I think the expectations are too high for any of these devices. Just recently my wife bought one for her classroom. For basics like random numbers, timers, and basic information. Playing with it at home on break she realized that Alexa is no more smart then what its programmed to do. I don't see any of these really being successful until you can talk to them as you would another human instead of barking specifics commands that they may or may not be able to answer. They all are certainly novelties in technology that at least makes people somewhat amused with them if nothing else. But as for being really smart, they are not there yet.

  13. Avatar

    Chris Payne

    Typo in 2nd graf: "...number 2 position on Android, indicating that it’s hardware also sold well this year."Sheesh, almost every article.


    And IMO, MS is dead here. Not only do they half-heartedly (if that) pursue consumer things, that half-heartedness turns everyone off. I don't see any way MS can make inroads here with their current strategy.



  14. Avatar

    mmcpher

    We have an Amazon Key but haven't set it up yet but have a Fire TV dongle a Show and an original Alexa device. I am still waiting for the promised accessory that will allow us to answer landline calls through the Show. I thought it was supposed to be released 2017? For my house, that would get everyone using Alexa as a matter of course.


    I never bothered using my Amazon Prime photo backup but PT's post on Prime reminded me that we can stream the photos back down to the Show, which would be nice. At some point, these things work together enough to build real momentum.

  15. Avatar

    xapache

    If you don't advertise you won't sell any Cortana speakers. Every other commercial is Alexa...


    Wish you guys had asked the CMO that, or maybe you did and missed it.

  16. Avatar

    xapache

    Alexa want an instant hit out the door... But Amazon did the best thing to sell it, they showed people what it does on TV to millions of engaged people. Now you've got a bit on your hands.


    The HK speaker...where is the advertising? I saw it at Best Buy and clearly it is nice device but....

    • Avatar

      yaddamaster

      In reply to xapache: yup. We got one - it's great. But zero advertising. Nadda. They can't even market it in their own stupid brick and mortar stores. In their "flagship" store in their backyard of Bellevue, WA it was relegated to TWO devices in an no-man's area of the store.


      • Avatar

        TheOneX

        In reply to yaddamaster:

        This always seems to be a problem with Microsoft. They don't understand marketing. Over the years they have made good devices that are on par with anything anyone else has put out, but they just don't market the devices. It is like they are afraid to put their money where their mouth is. They don't seem to realize that only reason Apple is in the position they current are is because they have better advertising than everyone else.

  17. Avatar

    Bats

    I don't understand the headline where it says that Amazon has pushed farther ahead. Where is the proof?


    The Amazon Echo is great. I bought one for my aunt and uncle for this Christmas. However, the echo with Alexa is clearly not as smart as Google Home. Amazon is winning, because it has been in the market first. Amazon vs Google is a great prize fight. For me, it doesn't matter, because i have both.


    To be honest, I don't even know why Microsoft entered this market. They had to know that they were going to lose. Like Windows Phone, you can't really do anything with the Invoke. I played with it at Best Buy and it's not super impressive. Think of it like this, when you're used to eating Wagyu Steak, eating a hamburger will make you close to throwing up.

  18. Avatar

    PincasX

    Every time Brad or Paul write about digital assistance they seem to trip over themselves to hold a coronation for Amazon. And currently that is kinda true in the U.S. but what kind of presence does Amazon have internationally? What languages does Alexa support? Which of their services are offered internationally? The answers to those questions show that Amazon is a pretty niche player. Google has an actual global reach with its product and services and should Apple get the HomePod out the door they will as well.


    Hopefully Mehdi can offer some much needed international perspective on this subject because Paul and Brad have a super myopic view. The market is much bigger than Ohio, Pennsylvania or the U.S.

    • Avatar

      Brad Sams

      In reply to PincasX:

      Honest question here, how are Google, Microsoft and Amazon doing outside of the US?


      Typically these things run in English first then make their way to other languages but the US is a massive, single-language, market, which is why we see the most companies being aggressive in the US.

      • Avatar

        PincasX

        In reply to brad-sams:

        I understand why these products start in English and that isn't terribly relevant to the point.


        Amazon is an international company but isn't terribly big outside of the U.S. Google, Microsoft and Apple are are global companies.


        If you look at digital assistant software, Alexa supports two languages, Google supports ten (with the exception of China that covers the world's ten largest economies). Siri is well over twenty which covers the world's top ten economies. I'm not going to bother with Microsoft since they don't seem terribly interested in even playing the game.


        When it comes to hardware availability Amazon has the lead but Google has been adding counties at a much faster clip and has more than two languages to offer. Apple .... well they have to figure out how to ship something.


        The other thing to consider is that the hardware devices are are not stand alone devices but rather interfaces for services. Amazon's global availability of it's services like music are fairly limited while Google and Apple have considerably larger reaches. In addition Google and Apple are far better positioned internationally for things like customer support and hardware service facilitation.


        So, while it is easy to look at Amazon's early success and be impress they are at a considerable disadvantage globally and globally is where most of the worlds population is.


        As for your initial question, I'm unsure if you are speaking of physical digital assistants or in general. In general, Google, Apple and Microsoft do incredible amounts of business outside of the U.S. Amazon is far more dependent on the U.S. for revenue.


        When it comes to hardware devices who knows. No one announces sales figures.

    • Avatar

      Daniel D

      In reply to PincasX:

      True. In Australia it is Google and then daylight, when it comes to these devices.

  19. Avatar

    skane2600

    It's funny that Amazon, a company that is fundamentally in the retail business, has introduced more innovative technologies than many purely tech companies. Certainly more of a tech company than Facebook or twitter.

  20. Avatar

    yaddamaster

    Unwrapped our Invoke yesterday for Christmas and set it up. Initial thoughts:


    * Setup was relatively simple but lacked decent recovery options. Example: initial setup was at a relative's house and I quickly determined I didn't want it to connect to their wifi - stopping the wifi setup results in the entire setup process just terminating. Not a big deal for me but I could see it being a potential issue for some. You also cannot use it as a bluetooth speaker until after the first initial setup.


    * Sound quality is simply amazing. It's worth the $99 on this proposition alone as a bluetooth speaker.


    * Spotify integration is perfect.


    * Skype calls work perfectly.


    * Search, traffic, weather, misc question - all work as well as they would on the desktop. So not as well as google but good enough.


    * I haven't tried any other skills


    I'm going to keep it. For only $99 it's a good value proposition. $199 - not a chance. But I'll toss $99 at something and not cry if it fails in six months. $199 is worth some tears.


    Microsoft needs to market this thing. Talk to press people so that at least Microsoft gets mentioned. Right now when an article is written on Alex or others, Microsoft isn't even mentioned once.


    I've often wondered what the next emerging consumer device would be after mobile. I think I now know. And Microsoft is going to be left behind if it doesn't quickly get it's crap together. But they're so focused on the enterprise.....I just don't know nor understand this abandonment of the consumer space.

    • Avatar

      JimP

      In reply to yaddamaster:


      I have an Invoke, too, and your review is spot-on. However, given that MS loves to drop technologies/platforms (Zune, Windows Phone, Band, Groove music service, etc.), I can't help but wonder how long it will be before MS drops support for dedicated Cortana speakers or Cortana in general.


      I guess if I can get a couple years out of it, I'll be happy, but MS sadly is a dying company unable and unwilling to keep up with its competitors.

    • Avatar

      Stooks

      In reply to yaddamaster:

      Wow someone actually bought this??????


      $99 would have bought A LOT of toilet paper.

    • Avatar

      TheOneX

      In reply to yaddamaster:

      I agree. I've been using Alexa for about a year, and I've used Cortana on PC for about 8 months. I've found Cortana to be much more useful as far as a personal assistant than Alexa, while Alexa is better as a Smart Home and Media consumption device. Their strengths and weaknesses compliment each other well in my opinion. This is why I am excited for the deal the two companies worked out. I'm just hoping they make it so I don't have to say "Open Cortanta" or "Open Alexa", and just open whichever one based on the wake word I use.


      Cortana would be very useful in an office environment because of how good she is as an assistant. Although, currently it would only really work in personal offices.

    • Avatar

      ozaz

      In reply to yaddamaster:


      They certainly do need to market it......I had to Google “Invoke” because I had no idea what it is, and I keep an eye on Microsoft news.

    • Avatar

      shameermulji

      In reply to yaddamaster:

      "I've often wondered what the next emerging consumer device would be after mobile. I think I now know."


      I wouldn't count wearables out of that title race just yet, and I don't mean AR / VR, but more specifically devices like Apple Watch. Apple Watch has witnessed strong growth over the last couple of years and with Apple Watch 3 and its focus on health / fitness / LTE, interest has never been higher. The combination of Apple Watch / AirPods is one of the bright spots in the post-Steve Jobs Apple.

  21. Avatar

    crfonseca

    I think it's important to remember that the Google Home app can also be used to control Chromecasts, and in fact in most of the world it's the only practical use it has.

    However, as others have said, Amazon has the same problem as Microsoft: not having a phone really hurts their reach. These days they're going for "select" PCs, but pretty much all PCs these days have Cortana and see where that got Microsoft.

    Google on the other hand has it's issues too, while they have literally billions of Android phones out there, China is pretty much blocked off and the millions of cheap phones that never get updated mean that they'll never get Google Assistant because people tend to stick to the defaults.

    This leaves us with Apple. Unfortunately, while I'm sure that Tim Cook is a great guy and all, he clearly lacks the vision that Steve Jobs had, so who knows what they'll do. I'm sure that were Jobs still around, Apple would completely dominate this market.

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