The Six Five team discusses announcements coming out of the Amazon Alexa Live 2021 Event.
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Daniel Newman: Another big one, Amazon Alexa Live 2021, and this time it turned its attention to the developer. So they do two iterations of it. They have the Alexa Live, where they launch all the gizmos and gadgets, things that fly around your house and take videos and listen and provide AI and multi-term conversations. This one though was all about skills, future of work, building that platform for developers to get paid for all of the intelligent things they’re building to be done on these millions and millions of Alexas around the world. Pat?
Patrick Moorhead: I appreciate you punting that over to me. Yeah. Listen, here’s the funny part. You don’t hear as much about Alexa as let’s say, you did a year and a half or two years ago when it was first out. Do you know why that is? That’s because people are actually using it. It’s become the fabric of what we do. I know the word fabric sounds like a marketing word, and it kind of is, but it is in our life. And whether it’s even asking the time or, “What’s my calendar,” or, “Set an alert,” everybody is using it for that.
But what I was really surprised about was how many skills are being used out there and how many interactions that are out there, and it’s crazy. It’s absolutely skyrocketing. Amazon strategically described it as what they’re going at. They want to make Alexa ambient. Listen, I’ve been talking about ambient computing for 20 years. We see it in science fiction all the way, Space Odyssey, where HAL, I know that’s probably a bad example, but it’s a negative example of where you can essentially ask HAL anything and it does it. And hopefully, it doesn’t lock you out of the spacecraft. But with that said, what Amazon did is they added about 27 new features to developers to make Alexa more ubiquitous, make Alexa more multimodal and make Alexa just smarter.
Quite frankly, you could read my Forbes article where I go into feature by feature, but I don’t think that’s most valuable here. I think what’s most valuable strategically is them looking at this as a ubiquitous service, which strategically is 100% the right way to go, and also that usage of Alexa is skyrocketing along with the partner opportunities. One of the things that’s crazy is this B2B opportunity that they have which is crazy, and there were hotels, there were banks that are able to… It’s almost a physical embodiment of chatbots. It’s a device that can do things for customers, whether that’s, “Get me a reservation,” or I’ve seen one of these in one of my hotel rooms where actually, you can ask it, “Hey, can you please send me a toothbrush?” Or, “Can you please turn off the lights inside of the room?” That really is the future of where this is headed.
Daniel Newman: Yeah. That’s some great analysis, Pat. I had some time to tune in between unpacking boxes. I always loved the gizmo gadget show. The developer stuff is super interesting because it’s really what brings everything to life. A lot of people hear about developer platforms for iOS. You hear about developed platforms for Android. Well, all of this headless commerce and all these applications that are going to allow us to do more with these Alexas that we’ve deployed. And again, oftentimes you have one phone, you might have eight Alexas, 10 Alexas, depending on the size of your home, your house, your office, and this thing has been very successful. Tens of millions are being deployed right now. I think is on a yearly, I think there’s like 165 million of them out there. I’m going to have to double check that number, so don’t hold me accountable to it. But it is quite a few.
I boil this down to three things of the 50 plus various announcements. One, it was all about improving customer and user experience. Customer and user experience, many features were designed to just make the experience of using Alexa better. Two, drive growth with easier customer acquisition, retention, and monetization. So you got to make this lucrative and attractive to the developer community. You want developers to come play in the sandbox, they have to have a reward. Things like paid skills, which were added and shopping actions give developers more opportunities to monetize what they’re building. Then finally, simplified development. We hear all about things like low code, no code. We need to make it easier so that developers can build faster, give them more plug and play, give them resources, design guides, entities, and even AB testing that can be done right in the platform. All these things were there. So overall, like I said, a great event, I am looking forward to seeing the next group of gadgets, but all good stuff here.