Almost exactly 10 years after the iPhone launched, Google Home went on sale in Canada at the end of June.

At first look, the products are different in many ways. The iPhone is designed to be mobile, whereas Google Home is solitary. The iPhone has a screen, whereas Google Home has only a speaker.

However, look at it again from a different angle and there are more similarities. The iPhone offered a whole new paradigm for how people would interact with technology, providing a form factor that’s usefulness wasn’t fully understood. So too, Google Home (as Alexa did before it in the U.S.), provides a totally different way for people to access Internet-based services. While the iPhone didn’t offer apps and become a developer platform until a couple of years later, Google Home is already supporting third-party actions (in the U.S.), as is Alexa with its wide array of Skills (more than 15,000 so far).

Both the iPhone and the current crop of “smart speakers” also have their naysayers. But looking at the sudden surge in interest in reaching customers through voice-first channels, you have to think that many companies are not willing to risk missing the opportunity to jump on the crest of a behaviour-altering tech trend before it becomes a tsunami. There have been 14,000 Skills released for Alexa in just the past year, according to Voicebot.ai, and since Actions for Google was released in May, it’s seen 378 Voice apps released.

Voice-first interactions with AI assistants is a technology revolution, says Brian Roemmele, an independent researcher and consultant specializing in voice-first technology. He first saw the potential just one week after Amazon’s Alexa was launched in November 2014. His wife had ordered it and set it up, and by the time he got home from work his kids had bonded with the cylindrical speaker and were asking it questions about outer space. (“Alexa, how many moons does Jupiter have?”)

“What this revolution is about is that the user interface is becoming irrelevant,” he says. “In the future, there will be AI assistant conversations with continuity, remembering where you went and what you did and who you met.”

Echo Show in kitchen
Amazon has created other hardware to deliver Alexa to the home, including the most recent Echo Show, which features a screen as well.

Pointing out that Amazon.com’s number one best-selling product in 2016 was the Echo Dot, the smaller and cheaper Echo alternative to connect to Alexa, Roemmele advises CIOs to set up voice services for their companies, just as they worked to set up websites 20 years ago.

“You need to create an edifice for your company that allows individuals using Alexa, or Cortana, or Siri, to interact with your company,” he says. “You have to build that intelligent front end.”

Voice control a compelling way to reach customers

CIBC is one example of a Canadian firm that’s taking the prospect of voice-first demand seriously. In April, it announced a “Canadian-first” mobile app that allows users to set up a deposit account, apply for a credit card, and apply for overdraft protection, complete with in-app voice commands. The iOS and Android app allows users to search for banking tasks through voice prompts. For example, saying “send money” will cause Interac e-Transfer and Global Money Transfer options to appear.

That’s just the start of the voice capabilities the bank’s development team is exploring, says Jose Ribau, chief data officer at CIBC.

“How banking fits into your life – say with the Google Home experience – means we have to do things differently,” he says. “Your expectations for how you want to interact with your bank are going to change.”

CIBC has opened up two innovation labs this year – one located at Waterloo, Ont.’s Communitech Data Hub and one in Toronto at MaRS – to allow developers to work in an agile way and collaborate with startups on new customer experiences.

It’s not the first bank to consider a voice-first channel for customer interaction. South of the border, Capital One already offers an Alexa Skill that allows customers to check the balance of their bank account or credit card, hear latest transactions, and even pay their credit card bill.

Launched at the end of June, Google Home is the only smart speaker available in Canada at present.

Nor are financial institutions the only firms to experiment with Skills as a way to reach customers. Consider these other examples:

  • Glad Leftovers can track what you put in the fridge or freezer.
  • Coldwell Banker connects users with local real estate agents and tells them about the “home of the week.”
  • Unilever, under its Hellman’s Brand, offers a Best Recipes Skill for the kitchen
  • Mercedes Me allows Benz owners to remotely lock doors, start the engine, and send an address to in-vehicle navigation. Ford and Hyundai offer similar apps for their connected cars.
  • Countless media organizations have developed Daily Briefing Skills to deliver audio content to Alexa.

Upward growth curve of smart speakers will inevitably include Canada

The smart speaker market segment was created with the launch of the Echo in late 2014 and it continues to dominate market share in geographies where it’s available. One forecast from eMarketer predicts Amazon will have a 71 per cent market share to Google Home’s 24 per cent globally by the end of 2017. Driven in part by more smart home devices – from smart light bulbs to thermostats to garage door openers – the smart speakers market is expected to climb from $400 million to $13 billion USD by 2024, according to Global Market Insights Inc.

And it won’t be just a two-horse race.

Apple HomePod
Apple says its HomePod speaker will come out in late 2017, but not to the Canadian market.

Timeline of smart speakers, according to Jackdaw Research:

  • November 2014: Amazon Echo
  • October 2016: Fabriq
  • November 2016: Google Home
  • August 2017: Alibaba Tmall Genie
  • Late 2017: Apple HomePod
  • 2018 and beyond: Lenovo Smart Assistant, Onkyo VC-FLX-1, Harman Kardon Invoke, HP Cortana Speaker, Tencent Speaker, Samsung Bixby Speaker

These speakers will only be the beginning of endpoints tying back to the AI assistants living in the clouds hosted by the likes of Google, Amazon, and Microsoft. While the smart speakers on the market today serve as useful demonstration devices for the technology, Amazon and Google are more interested in the business of delivering the service than building the hardware. Amazon, for example, offers direct access to the natural language processing behind Alexa with its Lex API, and offers a sizeable amount of free compute and storage to developers interested in building Alexa Skills. Beyond that, the Lex service can be used to integrate Alexa’s service directly into third-party products, as Toronto smart thermostat company Ecobee has done with its recent Ecobee4 thermostat.

There’s still no official launch date for Amazon’s Alexa products in Canada, but many observers feel it’s coming soon. In June, Amazon scaled up its Toronto-based office, where it says work on the global Alexa platform is being done.

Developers can pair Lex with other Amazon Web Services to make even more impressive AI interactions, says Ian Massingham, lead evangelist for AWS. Deep learning frameworks include MXNet and P2, Rekognition offers image recognition of objects and concepts, and Polly offers natural language speech generation and translation in 42 different voices and 27 different languages.

“You can program a neural network app wihtout knowing how the neural network works,” he explains. “We think this will be built into a lot of different things. You’ll just ask your washing machine to wash your clothes using services like this.”

The developer tools offer a ton of capabilities now, says Tom Hardin, a research specialist at G2 Crowd. Making the business case for committing company resources to supporting a voice first channel will be the slower part. Also, while Amazon is the clear market leader right now, the fact the space is so new and has many emerging players will make it hard to know the first place to develop services.

“Everyone is on the same playing field right now,” he says. “The tech is all kinds of the same and we’re looking for that next step.”

If Global Market Insights’ prediction of 50 per cent annual growth rate for smart speakers is correct, there will be plenty of incentive for businesses to jump on board soon. That’s about on par with the smartphone market’s growth following 2008, when Apple launched the App Store on iOS.

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