6 biggest threats to Alexa payments

September 21, 2018 11:16 AM

Amazon is coming out with a massive range of Alexa-enabled devices — from high-end speakers to ordinary-looking microwaves — with the goal of building out an ecosystem tied to the company's massive e-commerce platform.

The variety of these new devices may seem random or experimental, but each is responding to a specific threat to Amazon's work in voice-controlled commerce.

The microwave is the doorway to the kitchen

An AmazonBasics Microwave sits on display during an unveiling event at the Amazon.com Inc. Spheres headquarters in Seattle, Washington, U.S., on Thursday, Sept. 20, 2018. Amazon.com Inc. unveiled its vision for smart homes powered by the Alexa voice assistant, with a dizzying array of new gadgets and features for almost every room in the house -- from a microwave oven to a security camera and wall clock. Photographer: Andrew Burton/Bloomberg

Andrew Burton/Bloomberg

The AmazonBasics microwave — a $60 appliance that can respond to voice commands and reorder popcorn — is perhaps the most unassuming of Amazon's many efforts to get into customers' kitchens.

It follows products such as the product-specific Dash buttons or the bar code-scanning Dash Wand, which can be used to restock products by initiating an order and payment on Amazon.com.

But what it's really responding to is devices such as the Samsung Family Hub refrigerator, which connects to Mastercard to reorder food items from a screen built into the fridge door. Most people may not be willing to replace their refrigerators on a whim, but a cheap microwave is much more palatable.

The microwave also sets the bar lower than AmazonFresh, the company's home delivery and grocery pickup system, which faced negative reviews of perishable products that arrived spoiled. By comparison, popcorn is a much easier (and more habit-forming) food product to deliver on demand.

Alexa in the passenger's seat

David Limp, senior vice president of devices and services at Amazon.com Inc., with Echo Auto

David Limp, senior vice president of devices and services at Amazon.com Inc., presents the Amazon Echo Auto smart device during an unveiling event at the company's Spheres headquarters in Seattle, Washington, U.S., on Thursday, Sept. 20, 2018. Amazon.com Inc. unveiled its vision for smart homes powered by the Alexa voice assistant, with a dizzying array of new gadgets and features for almost every room in the house -- from a microwave oven to a security camera and wall clock. Photographer: Andrew Burton/Bloomberg

Andrew Burton/Bloomberg

Like refrigerators, cars can be a very expensive purchase — especially if the only upgrade is a built-in voice assistant. For those consumers who want Alexa in the dashboard but don't want to buy a whole new car to get that feature, Amazon debuted Echo Auto, a dashboard-mounted device with eight built-in microphones to pick up any conversation happening in the car.

And of course, if drivers wanted to verbally fill up an Amazon shopping cart during their home commute, the Echo Auto can connect to their phone to initiate those purchases.

But the road to in-car commerce is already quite crowded.

For example, BMW's upcoming models are getting their own in-dash voice assistant.

BMW's new voice assistant — activated by the phrase "Hey BMW" by default — is focused primarily on in-car controls but is designed to get smarter over time and integrate with other voice assistants. This means it could integrate with Amazon's Alexa — or it could supersede it with a BMW-branded commerce platform.

A screen in every room

An Amazon Echo Show smart speaker and screen sits on display during an unveiling event at the Amazon.com Inc. Spheres headquarters in Seattle, Washington, U.S., on Thursday, Sept. 20, 2018. Amazon.com Inc. unveiled its vision for smart homes powered by the Alexa voice assistant, with a dizzying array of new gadgets and features for almost every room in the house -- from a microwave oven to a security camera and wall clock. Photographer: Andrew Burton/Bloomberg

Andrew Burton/Bloomberg

Perhaps it's no mistake that the fabric-covered third generation Echo Dot speaker resembles the fabric-covered Google Home speakers, down to both the color selection and the price.

Google Assistant may not have the ties to an e-commerce ecosystem that Alexa has, but it is a steadily growing threat. The next version of Google's flagship Android smartphone, the Pixel, is rumored to come with a "Pixel Stand" that could turn the handset into a voice-controlled digital assistant when it's docked.

The functionality would actually be more in line with the Echo Show, another device that got an upgrade alongside the many new gadgets Amazon announced. This device has a built-in screen that lets users browse products and make phone calls. At $230, it's one of the more expensive items in the Echo lineup, but its design is also more in line with that of a tablet or large-screened smartphone.

Like the AmazonBasics Microwave, this device is also meant to be used in the kitchen; Amazon demonstrated integration with the subscription cooking app SideChef.

Ring picks up where Amazon Key left off

An Amazon Ring security camera sits on display at the Amazon.com Inc. Spheres headquarters during an unveiling event in Seattle, Washington, U.S., on Thursday, Sept. 20, 2018. Amazon.com Inc. unveiled its vision for smart homes powered by the Alexa voice assistant, with a dizzying array of new gadgets and features for almost every room in the house -- from a microwave oven to a security camera and wall clock. Photographer: Andrew Burton/Bloomberg

Andrew Burton/Bloomberg

Amazon has built a market for in-home microphones for voice commerce; it has had less success with convincing consumers to put a camera in their homes.

Amazon Key is perhaps the company's biggest PR blunder — the camera, meant to provide a sense of security for in-home deliveries, just seemed to compound the worries people had about letting couriers into their homes for any reason.

The Echo Look was less threatening, but far more niche. That device was meant to allow fashion-savvy consumers to ask Alexa for assistance picking an outfit (and presumably getting inspiration for more clothing that could be purchased on Amazon.com).

The updated Ring Stick Up Camera is more aligned with Amazon Key, but with the Ring brand, which is more well known as a provider of security products. Amazon purchased Ring this year, and is doubling down on its security features with more smart lock integrations.

This may not make people comfortable with in-home deliveries just yet, but with Walmart experimenting with a similar system, Amazon isn't ready to give up this market.

Is there an Echo in here?

Amazon Echo Input devices sit on display at the Amazon.com Inc. Spheres headquarters during an unveiling event in Seattle, Washington, U.S., on Thursday, Sept. 20, 2018. Amazon.com Inc. unveiled its vision for smart homes powered by the Alexa voice assistant, with a dizzying array of new gadgets and features for almost every room in the house -- from a microwave oven to a security camera and wall clock. Photographer: Andrew Burton/Bloomberg

Andrew Burton/Bloomberg

Despite the aggressive expansion of the Echo lineup, the product is first and foremost a speaker. Thus, it won't appeal to everyone — audiophiles may balk at its sound, and many other folks may simply not want an Amazon-powered monolith displayed prominently in their living rooms and kitchens.

For this market, Amazon designed the Echo Input, a small device with all the necessary built-in microphones but with no built-in speaker of its own. This is meant to transform any speaker system into an Alexa-powered device for voice commands and shopping, but Amazon is not the first to this market.

In function and price, the $35 Echo Input resembles Chromecast Audio, a music streaming device sold by Google. Chromecast Audio doesn't support voice input, however, giving Amazon the edge in turning home speaker systems into commerce portals.

Can Alexa do your thinking for you?

David Limp, senior vice president of devices and services at Amazon.com Inc., speaks about the Alexa Hunches software during an unveiling event at the company's Spheres headquarters in Seattle, Washington, U.S., on Thursday, Sept. 20, 2018. Amazon.com Inc. unveiled its vision for smart homes powered by the Alexa voice assistant, with a dizzying array of new gadgets and features for almost every room in the house -- from a microwave oven to a security camera and wall clock. Photographer: Andrew Burton/Bloomberg

Andrew Burton/Bloomberg

One of the most intrusive ideas is Alexa Hunches, which allows the digital assistant to guess at what the consumer plans to do — or forgot to do — based on its observations of users' habits.

Amazon's demonstrated use case for this is to remind consumers to turn off the lights or lock their doors when they tell Alexa it's time for bed. But it's not too far a leap to think that Alexa could integrate with the Dash reorder system (or the Alexa-powered microwave) to suggest that consumers reorder popcorn, laundry detergent and other products.

The biggest threat to this technology is consumers' own smartphones. Many mobile apps will already suggest purchases based on habits, such as the Eat24 smartwatch app, which can suggest when to order a pizza based on past habits. That particular feature was demonstrated as a use case for Google's Android Wear watches — perhaps it could also come to the new Echo Wall Clock.