At 8 o'clock for electronics enthusiasts: If you're looking for the hottest gadget type from 2017, smart speakers would definitely top the list. Amazon pioneered this new segment, and soon after, Google, Apple, and Microsoft jumped in. Companies like Samsung, Alibaba, Tencent, and Lenovo also started showing interest.
The image below shows what some of these smart speakers look like. [Insert Image]
With the tremendous success of the Galaxy S8 and S8+, Samsung managed to shake off the shadows cast by the Galaxy Note 7 this year. Recently, rumors surfaced that the Korean giant is working on a smart speaker based on the Bixby voice assistant, codenamed Vega.
As major players continue to compete fiercely in this space, Samsung surely won't overlook the emerging smart speaker market. But can they produce a competitive product? That's a question worth exploring.
Uncertain Samsung
According to earlier reports from The Wall Street Journal, Samsung is currently developing a smart speaker based on Bixby, named Vega. However, progress on this project slowed down due to issues with Bixby itself.
At present, there’s very limited information about this device. Its specifications and functionalities remain unclear, and its release date is uncertain.
The Korea Herald’s latest report suggests that Samsung's enthusiasm for entering the smart speaker market isn’t strong enough. The report notes that Samsung doesn't think smart speakers have a significant market. Globally, Amazon dominates the smart speaker market, but locally in Korea, the market is too small to be profitable.
Moreover, Samsung is somewhat powerless to dive into this uncertain market, as most of their AI experts—who are far fewer than those at U.S. tech giants—are currently focused on developing the English version of Bixby.
Experts believe that Samsung might only adopt a “wait-and-see†approach in the smart speaker field, unlikely to quickly enter the market with a product that matches its competitors’ capabilities.
Intense Competition
As mentioned earlier, Amazon kicked off the interactive smart speaker market with Echo back in late 2014. Over the next two years, Amazon held onto its dominance firmly. But last year, as Echo gained popularity, major manufacturers began catching up.
Google launched its own smart speaker, Home, towards the end of last year. At this year's CES, there were numerous similar products, such as Lenovo's Smart Assistant, which resembles Echo. Apple's HomePod came out last month, while Alibaba's Tmall Genie also hit the market earlier this month.
Meanwhile, several Microsoft partners are set to release smart speakers based on Cortana soon. Tencent and Xiaomi are rumored to roll out their products in the second half of the year.
When Samsung finally launches its own smart speaker, the market will undoubtedly become more dynamic.
Software Technology Shortcomings
The development of most consumer tech products typically follows a pattern: one or two companies lead the way, others join in, and eventually, the market stabilizes with clear winners. This applies to smartwatches, drones, VR headsets, and fitness trackers alike.
However, the smart speaker market differs significantly due to technical barriers. Unlike the aforementioned products, smart speakers don’t have readily available, free software options, which limits smaller manufacturers lacking technical expertise.
For a smart speaker, the voice assistant driving its intelligent functions is clearly the most crucial component. Whether it’s Amazon’s Alexa, Google’s Google Assistant, or Apple’s Siri, each has matured over the years and is now quite advanced. In contrast, Samsung’s voice assistant, Bixby, lags far behind its competitors in terms of technological accumulation.
Weak software technology is a common issue among most hardware manufacturers, and Samsung is no exception. Their customized TouchWiz interface has long been criticized by users, though it has improved gradually in recent years. Additionally, they’re the only manufacturer still supporting and developing Tizen OS, but related products haven’t made much of an impact.
Bixby is a major feature of Samsung’s Galaxy S8 and S8+, even featuring a dedicated activation button. However, its English version only launched recently, and it struggles to accurately recognize all accents, dialects, and expressions.
A Galaxy S8 without Bixby can still be considered an excellent smartphone, since it’s not the phone’s core functionality. But for a smart speaker, the voice assistant is everything. The quality of the latter directly determines the success or failure of the product.
Localization Challenges
The geographical limitations of smart speakers are quite pronounced. Amazon’s Alexa voice service is currently only available to hardware manufacturers in the UK, the US, and Germany. Google Assistant currently supports English but will soon add more languages. Even so, its coverage remains limited. Apple’s Siri supports multiple languages on the iOS platform, but the situation for HomePod is unclear.
Bixby took three months to go live in the US because English wasn’t sufficient.
Due to differing user habits, the primary audience for smart speakers is in the Western market (especially North America). However, Bixby doesn’t seem ready to cater to these users yet.
Localization goes beyond language. Even if Bixby’s language skills improve, Samsung will face challenges in other areas. Voice assistants need to understand local accents and idioms and be familiar with local TV shows, movie stars, and famous athletes. Manufacturers need to integrate relevant local entertainment, information, and other services. This is why most successful voice assistants are part of the extensive ecosystems of large manufacturers.
While Bixby might be familiar with these things in South Korea, Samsung may need to put in extra effort to succeed in the broader Western market.
Different Business Models
How do smart speakers make money? It depends on the existing business models of manufacturers.
Amazon sees the Echo series and Alexa platform as opportunities to boost sales from home appliance stores. Google plans to use advertising to generate additional revenue—after all, Google Home itself isn’t expensive.
Apple, on the other hand, will likely adopt a consistent strategy to profit from both hardware and software as a whole. As a high-quality speaker, HomePod should also drive growth in Apple Music subscriptions.
But Samsung’s situation is different from these competitors. As a hardware manufacturer, most of Samsung’s profit comes from selling hardware products—semiconductors, displays, mobile devices, and home appliances.
However, the business models adopted by Amazon, Google, and Apple aren’t purely profit-driven from smart speakers themselves—since the price of such devices is generally low, profits may be limited.
If it’s not profitable, Samsung shouldn’t rush into this market.
The Time Isn’t Right
It’s evident that the conditions and timing for Samsung to launch smart speakers aren’t fully mature. Not only is Bixby unable to handle this crucial role, but they might struggle to find a profitable business model.
But is this South Korean giant truly abandoning this product category as rumored? It’s hard to say.
In the face of emerging technological trends over the past few years, Samsung has never been absent—whether it’s smartwatches, fitness trackers, 360-degree cameras, wireless headphones, or VR headsets. For such a financially robust company, profitability may not be the most important factor; staying ahead of competitors is key.
In any case, the smart speaker market should soon become more vibrant.
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