Baidu Jumps Into Crowded Smart Speaker Fray With Raven H

(Bloomberg) -- Baidu Inc. has unveiled a smart speaker designed to stake out a spot in a Chinese market bereft of competing Google or Amazon devices.

The Chinese search giant’s palm-sized “Raven H” goes on sale December and relies on Baidu’s own DuerOS software to power services on the multi hued device. At 1,699 yuan ($256), it’s pricier than devices from JD.com Inc. or Alibaba Group Holding Ltd. launched this year in a scramble to create devices that can recite search results or book a car ride.

Digital speakers powered by virtual assistants are one of the hottest consumer products around, but Chinese companies are relatively late to a game dominated by U.S. tech giants. Unlike the sleek Amazon Echo or Apple Inc.’s HomePod, Baidu’s Raven H resembles a column of cards, with a detachable top deck that doubles as a touch-sensitive remote and can hook up to its own Netflix-style streaming service. Very basic shapes and patterns can be displayed on its surface to form simple numbers or emoticons, for instance.

“Its adjustable design lets its user move through their home or workspace,” said Cheng Lyu, who joined Baidu as general manager of its intelligent hardware unit this year.

Success with the Raven H -- the first in a series -- is vital for Baidu, which is struggling to turn its expertise in artificial intelligence into commercial products. Search revenue growth is slowing and profits from new products such as autonomous cars are years away. The company said Thursday it’s struck a deal to install the device in 100 InterContinental hotel rooms in Beijing. 

Shares of Baidu rose 2.2 percent to $239.32 in New York trading. The stock has gained 46 percent this year.

Baidu also announced two other devices that will act as personal assistants. The Raven R is a small robot arm with a speaker in its base that dances to music while the Raven Q is a prototype robot on wheels the company said would eventually feature some of the same technology used in its driverless car program Apollo. Neither came with a price or a firm release date.

In the longer term, Baidu is betting that its troves of user and search result data can help it supercharge AI services from driverless cars to personalized news. Its Brain platform now has 370,000 partners and its news-aggregated stories have been clicked on over 2 billion times.

“There is still little evidence of how monetization will develop,” said Kirk Boodry, an analyst with New Street Research. “We are intrigued by the smart assistant product launches although these come at high price points into an increasingly crowded market.”

The Raven’s launch took place at Baidu World, its annual showcase of technology. The company announced updates to its mobile app to more closely integrate news with search results. It also demonstrated an assisted-driving program that uses infrared cameras to monitor drivers and plays loud music when they tire.

Baidu hasn’t yet worked out a plan to monetize DuerOS and won’t do so until AI assistants are widely adopted, which DuerOS General Manager Kun Jing thinks could take up to three years. The company however intends to target overseas users within two years with products such as its smart speakers.

“At a certain stage, we’ll probably be more aggressively entering markets in addition to China and we’re currently making plans,” he told reporters. “When we acquired Kitt.AI -- a Seattle-based company -- the company already had many international customers like Spotify.”

(An earlier version of this story corrected the name of Kitt.AI in the final paragraph.)

To contact Bloomberg News staff for this story: David Ramli in Beijing at dramli1@bloomberg.net.

To contact the editors responsible for this story: Robert Fenner at rfenner@bloomberg.net, Edwin Chan

©2017 Bloomberg L.P.

With assistance from David Ramli