Sonos confirms a forthcoming Alexa speaker (AMZN)

echo forecast august 2017

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Sonos, a mid- to high-end speaker manufacturer, released an updated privacy policy for its speakers that almost certainly confirms that the company will release a speaker with Amazon’s Alexa voice assistant built into the device in the near term, according to Forbes.

Though many devices that integrate with Alexa have been announced and are starting to come to market, this is one of the higher-profile examples and could be instructive for smart-speaker designers.

The company first announced its intention to add voice-assistant integration to its speakers over a year ago, but didn’t give any specific time frame for that step. And an FCC filing from the company that surfaced a few weeks ago showed that it is looking into systems that would support multiple voice assistants, so a user could potentially have the option to choose between Amazon’s Alexa or Google’s Assistant, depending on what other devices they own and what platform they prefer.

A Sonos device with Alexa integration could give a glimpse into how consumers will react to Apple’s HomePod. Sonos is known for its wireless speakers, which provide multiroom audio with better audio quality than a device like Amazon’s Echo. Apple is counting on consumer desire for high-quality audio paired with a voice assistant to drive consumers toward its forthcoming HomePod smart speaker. Sonos’ speaker will be a test case for an audio-first smart speaker, and a test of whether consumers really want better audio quality, or if they’re more likely to be drawn to a device with a screen like Amazon’s Echo Show. BI Intelligence found in our exclusive Tech Adoption survey that the Echo Show engendered more excitement — especially among self-identifying early adopters — than the HomePod, which could spell trouble for Apple when its device comes to market in December.

Smart speakers — Amazon's Echo, for example — are the latest device category poised to take a chunk of our increasingly digital lives. These devices are made primarily for the home and execute a user's voice commands via an integrated digital assistant. These digital assistants can play music, answer questions, and control other devices within a user's home, among other things.

The central question for this new product category is not when they will take off, but which devices will rise to the top. To answer this question, BI Intelligence, Business Insider's premium research service, surveyed our leading-edge consumer panel, gathering exclusive data on Amazon's recently released Echo Show and Echo Look, as well as Apple's HomePod.

BI Intelligence, has put together a Smart Speaker report that analyzes the market potential of the Echo Look, Echo Show, and HomePod. Using exclusive survey data, this report evaluates each device's potential for adoption based on four criteria: awareness, excitement, usefulness, and purchase intent. Finally, the report draws some inferences from our data about the direction the smart speaker market could take from here.

Here are some of the key takeaways:

Amazon's new Echo Show is the big winner — it has mass-market appeal and looks like it will take off. The combination of usefulness and excitement will drive consumers to buy the Echo Show. The Echo Look, though, seems like it will struggle to attract that same level of interest.
Apple’s HomePod looks likely to find a place in the smart speaker market but won’t dominate its space like the iPhone or iPad did.
The smart speaker market will evolve rapidly in the next few years, with more devices featuring screens, a variety of more focused products emerging, and eventually, the voice assistant moving beyond the smart speaker.

In full, the report:

Showcases exclusive survey data on initial consumer reactions to the Echo Look, Echo Show, and HomePod.
Highlights the aims and strategies of major players in the smart speaker market.
Provides analysis on the direction this nascent market will take and the opportunity for companies considering a move into the space.

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