Amazon May Have Just Cracked the Smart Home Nut (Premium)

Today, Amazon announced new products and services that mark its formal entry into the smart home market. And in characteristic fashion, the e-tailer is offering unique benefits that play to the strength of its popularity with consumers.

The products are Amazon Key and Amazon Cloud Cam, plus a new subscription service for the latter.

Amazon Key provides secure home access for Amazon Prime deliveries, with thousands of other service providers being added over time. And Cloud Cam is an Alexa-compatible home security solution that also integrates with Amazon’s other hardware products.

Yep. Brilliant.

Both of these products leverage Amazon’s unique strengths, and each could do much to push smart home technologies to consumers more rapidly than has been the case so far.

Consider Amazon Key: It’s yet another advantage for Amazon Prime, an incredibly popular service that provides package delivery and a host of other benefits to consumers for an annual fee.

“Amazon Key gives customers peace of mind knowing their orders have been safely delivered to their homes and are waiting for them when they walk through their doors,” Amazon vice president Peter Larsen says. “Now, Prime members can select in-home delivery and conveniently see their packages being delivered right from their mobile phones.”

Amazon Key will launch in 37 cities and surrounding areas in the U.S. on November 8, and more locations will be added over time. It requires a Prime membership and works with Same-Day, One-Day, Two-Day and Standard shipping. And it allows customers to have their packages securely delivered inside their home without having to be there.

“Using the Amazon Key app, customers stay in control and can track their delivery with real-time notifications, watch the delivery happening live or review a video of the delivery after it is complete,” the company notes. “Each time a delivery driver requests access to a customer’s home, Amazon verifies that the correct driver is at the right address, at the intended time, through an encrypted authentication process. Once this process is successfully completed, Amazon Cloud Cam starts recording and the door is then unlocked. No access codes or keys are ever provided to delivery drivers. And, for added peace of mind, in-home delivery is backed by Amazon’s Happiness Guarantee.”

The Amazon Key In-Home Kit starts at $249.99. It includes an Amazon Cloud Cam (Key Edition) with 1080p Full HD, night vision, and two-way audio capabilities, and an Amazon Key-compatible smart lock. These can be installed professionally, or you can do it yourself.

And then there’s Amazon Cloud Cam. Numerous companies, like Nest, already sell smart home security products. But the benefit here is that Cloud Cam is sold by Amazon, the company that makes the Echo and other Alexa devices. And it works exclusively with Alexa.

If you’re familiar with how Amazon does things, you know that its own products tend to be much less expensive than the competition. And on that note, Cloud Cam costs $120. The cheapest Nest security cameras cost $200. (Granted, they are compatible with other assistants, but this is about lock-in too.)

“Cloud Cam is a premium product at a non-premium price,” Amazon vice president Charlie Tritschler says. “It has all the features you need to monitor your home, including a 1080p Full HD camera, night vision, two-way audio, and free storage for clips. And with the secure AWS cloud powering Cloud Cam’s advanced computer algorithms and intelligent alerts, the service is always getting smarter.”

The service, then, is separate from the hardware: Amazon charges $6.99 to $19.99 per month for different allotments of motion detection clips and support for 3 to 10 cameras. Amazon also sells the camera in two- and three packs ($200, $290).

Cloud Cam, which is a standalone version of the camera that comes with Amazon Key, works with Alexa, of course, but also Amazon’s Fire TV devices and Fire tablets, and with Android and iOS. It will also launch on November 8.

As I’ve noted in the past, Amazon’s biggest advantage with consumers over, say, Google, Apple, or Microsoft, is that it can blend physical services with virtual services. Prime provides package delivery at a discount, especially for those that buy a lot of stuff. But it adds digital perks related to Kindle, cloud storage, music, and more on top of that.

And with Alexa, Amazon has miraculously created the most popular digital personal assistant platform and has steadily expanded its range of Echo and other Alexa-compatible devices. These devices, like the competition, work with ecosystems of third-party hardware. But only Amazon is an actual retailer, and it can—and has always—built its own devices, which it sells at a discount. For the Amazon customer base, these inexpensive products represent a great and obvious value.

I’ve long wondered about these unique strengths and, frankly, why I’m not taking better advantage of them myself. I do use Kindle and Audible regularly, but I don’t do much with Amazon’s other digital services, even though many of them are free to me because we are Prime subscribers. Likewise, I’ve opted for Google’s personal assistant over the far more popular Alexa, mostly because I believe that Google can’t lose. That is, Assistant is key to Google’s future, I’ve said. It’s not clear that Alexa is key to Amazon’s.

But that thinking may be flawed. As Amazon moves aggressively—so aggressively—to pad out of its offerings in these areas, I’m starting to wonder if I have misjudged this company. That, maybe, Google has met its match when it comes to being predatory, competitive, and aggressive.

Regardless of this evolving worldview, this much is clear: In Amazon, Google may very well have found the one company that can undercut it in critical areas, much as Microsoft discovered with Google over the past decade. This is a fight worthy of analysis and debate.