Making Sense of Amazon’s Alexa Spaghetti Strategy

(Bloomberg) -- Last week, in the span of about an hour, Amazon.com Inc. introduced 70 new devices and services to an inundated tech press at its Seattle headquarters. There were new Echoes, an Alexa-equipped subwoofer, a DVR, Alexa for the car—even a microwave. It felt a little like the e-commerce giant was throwing spaghetti at the wall to see what would stick. And “now you can reheat the spaghetti in an Alexa-powered microwave,” quipped my colleague Alistair on Twitter.

But this is Amazon, and there’s usually a method behind the madness. So let’s look a bit closer.  

Amazon is racing the likes of Google, Apple Inc. and Microsoft Corp. to position its technology at the center of our Jetsons-like home of the future, where everything from the washing machine to the thermostat can be controlled with voice commands.Amazon helped to pioneer this concept with the introduction of the Echo in 2014. Last week’s new products, designed to extend its advantage, fall into three main categories.

The first and most obvious constitutes the new kinds of Alexa-equipped devices aimed at consumers, like better-sounding Echo speakers, a home security camera and a wall clock receptive to verbal commands. The more Alexa stuff Amazon seeds into the market and into our lives, the stronger its case that Alexa—and not Siri or the Google Assistant—has become a ubiquitous new computing platform.

In the second category, Amazon wants to get customers to add voice capabilities to things they already own. Thus we have the Amazon Smart Plug, which connects to an outlet and voice-enables any device, and the Echo Auto for your dusty old station wagon, which you may not plan on trading in anytime soon.

Finally, Amazon is giving manufacturers new tools like the Alexa Connect Kit, a chipset designed to get them to integrate Alexa into their devices. And it’s working directly with carmakers like Audi to build voice capabilities into their vehicle fleet.

This strategy, aimed at both companies and consumers, evoked some gruesome memories of trudging to the Consumer Electronics Show in Las Vegas every January, and visiting the tents outside the main convention hall. There, companies like Cisco Systems Inc., IBM, Sony Corp. and Microsoft would invariably show off their idea of a smart home.  These visions, where everything from door locks to dishwashers would supposedly be connected to the web, never really took off.

One reason is that those companies mainly wanted to license their home networking specifications to appliance makers and make money from sharing in product sales. The appliance makers weren’t interested—they didn’t want to forfeit profits, and customers weren’t demanding that their coffee makers connect to the internet.

Amazon, by contrast, is licensing Alexa to developers and manufacturers basically for free. Its business revolves not around licensing proprietary technology to companies, or even really selling gizmos to customers, but getting devices into people’s homes that will serve as gateways to its massive online store, and to services like its streaming music and video catalog.

It has also demonstrated that voice control is appealing to consumers. Those old CES displays usually showed homeowners impractically controlling everything from their PC. Even pulling out your smartphone to turn off a light or turn on your air conditioning—a concept introduced by Nest, now a Google subsidiary, back in 2010—isn’t exactly elegant.

And just in case appliance makers aren’t persuaded by all this, Amazon also has something of a stick to make sure they fall in line. That’s where the $60 AmazonBasics Microwave comes in.

If manufacturers don’t get aboard the Alexa train, Amazon seems to be saying, it just might start making and selling their products itself.

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To contact the editor responsible for this story: Anne Vandermey at avandermey@bloomberg.net

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