CES Day 1/2 – Winners and losers.

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Winners

Amazon.

• In my mind, the star of CES 2017 is Amazon which is beginning to show signs of doing to Google what VHS did to Betamax.
• Betamax was a vastly superior technology but a slick marketing campaign by JVC ensured that VHS was adopted and Betamax struggled to remain relevant.
• These battles are now fought online and in the developer community and here it is currently Amazon all the way.
• On the show floor everyone who is developing a device that goes anywhere near the home is ensuring that it works with Amazon’s Echo.
• Google Home has barely put in an appearance.
• Furthermore, Huawei’s Mate 9 has included Amazon’s digital assistant Alexa because Google’s Assistant is currently only available on Pixel.
• This is a huge and lucky win for Amazon because as it has managed to kick start the virtuous circle where more developers mean more devices sold which mean more developers and so on.
• The issue is that when it comes to the digital assistant itself, Alexa is far too dim to be of any real use (see here) but if users adopt it for a hub in the smart home, Amazon will then have time and data to improve.
• Using Echo as a smart home controller could easily evolve into other areas as the device will already be present in the home which could really hurt the appeal of Google Assistant in the long term.

NVIDIA.

• NVIDIA is the word on everybody’s lips and despite a somewhat lack lustre set of demos, the stand has been heaving every time I have walked past it.
• Most attention is being paid to what NVIDIA is doing in automotive and how it could represent a challenge to Intel in the server space.
• Its key proposition is to use its parallel graphics chipset designs in other tasks where parallel processing is an advantage such as artificial intelligence and in servers and data centres.
• NVIDIA has neatly combined the two hot potatoes in the tech industry (AI and automotive) which has resulted in a disproportionate amount of interest being generated.
• NVIDA has gained great momentum from CES but whether it can keep that going through 2017 is a valid question.

HERE.

• HERE is one of the few that has shown ground breaking progress over the last few days.
• The addition of Tencent, NavInfo and Intel as partners (see here) has continued with addition of Nvidia and Mobileye as partners.
• For HERE, the addition of Mobileye is a particular endorsement of its strategy as only 12 months ago, Mobileye was adamant that autonomous driving did not require a map.
• This embarrassing about-face gives HERE’s credibility another meaningful boost.
• HERE is now a credible threat to Google Maps but the time has come to turn the ink on the partnership agreements into action.

Losers

Google.

• Google is the big loser when considering the traction that Amazon Echo is generating among the smart device companies.
• This is because Google Home should be a superior product when compared to Echo because Google Assistant is much smarter with better functionality than Echo.
• However, early users of Google Home complain of poor voice recognition which appears to be preventing the superior intelligence that underpins the user experience from shining through.
• Combine this with the fact that on all the IoT stands, there is barely a Google Home device to be seen and one starts to wonder whether Google Home will make it at all.
• This is a sign that Google’s execution on Google Home (and potentially Pixel) is not going as well as hoped.
• I am increasingly worried that Google will squander the opportunity to both capitalise on the market that Amazon has opened for it as well as benefit from Samsung’s misfortunes.

LeEco.

• While LeEco has a good presence at CES with a range of devices and two cars, it has a real PR problem.
• Chatter in and around the stand is all centred around the financial difficulties that LeEco is experiencing with very little focus attention being paid to the products or the proposition.
• For a consumer device company this is a massive problem as it can quickly lead to a death spiral of confidence.
• If people think that the company’s future is doubt, then they won’t buy the products which, in turn, will increase financial pressure, bad news flow and so on.
• LeEco needs to break this cycle before it is too late and I still think that the only way out is for the company to ditch both its own car as well as that of Faraday Future (see here).

Apple.

• Apple does not publicly attend trade shows but the degree to which it has been absent in the last few days is striking.
• No one is discussing Apple on the stands and I have been greatly surprised with the degree with which two of its long-term initiative appear to be being ignored.
• I have long believed that Apple’s long-term strategy to maintain its differentiation (and its margins) is to a large part predicated on its ability to offer a great experience around the home and in health.
• This is where HealthKit and HomeKit (see here) come in but to work, device makers need to ensure that their devices are fully interoperable with this software.
• Of the entire multitude of devices that I have seen in the last two days these two words were not mentioned once.
• While Apple remains the strongest ecosystem, it needs to ensure that it continues to be the place where home and health devices come together because that is where the real value is to be had.
• Amazon is showing up Apple just as it is Google.