The race for voice caught fire this week as Amazon announced it was opening the technology that powers Alexa to developers.
It's called Amazon Lex and is hosted in the cloud, collecting anonymized data from millions of users to further enhance the capabilities of Alexa and increase Amazon's reach. Opening Lex to developers is intended to radically increase the spread of Alexa, to devices of nearly any kind, so consider this a powerful salvo in Amazon's fight against Apple's Siri and Google Assistant to dominate voice.
After losing out on mobile (remember how the Fire flopped?) and the inherent opportunity for voice, Amazon is looking to inject Alexa into virtually everything else in the world.
Thanks to this open environment, independent developers can not only integrate the voice recognition, they can build Alexa-powered chatbots into other software and hardware. If a user keeps Amazon Echo in the living room, that user could carry on a voice-led transaction with the refrigerator to order more groceries.
This connectivity can foster virtually limitless applications and will only get better with time. The artificial intelligence powering Alexa requires vast heaps of data to be worth its salt and to improve, which this potential for nigh omnipresence will provide.
Spread Like a Virus
Opening up Lex will prove to be a smart move for Amazon and, ultimately, lucrative. One merely needs to look at the success of Android to understand how this will play out. The open smartphone operating system is now used on the Internet more than Windows, putting it at the top of the online mountain.
And, since Android's default search engine is Google, that shores up Google's search dominance rather nicely, building a solid moat around the company's cash engine.
Amazon hopes to achieve that same effect, but for securing its position in e-commerce.
This will come about by two channels. First, the ease of integration, by means of Alexa Voice Service and an open Lex system, will put the voice assistant in virtually every device.
Second, the company has been offering some discounts and deals exclusive to purchases made with Alexa, so a fast pace of user growth doesn't seem like a far-off objective.
To top off the moneymaking potential in e-commerce, Amazon will charge developers by the volume of requests Lex processes for them.
An open Lex can also be a boon for the sluggish chatbot economy. Facebook M proved to be a bit of a flop and Slack's nowhere near AI-powered conversations yet, but Alexa could be the shot of adrenaline the market needs to get going.
Soon enough, Alexa competitors will start appearing or ramping up existing efforts, proclaiming to offer better chatbot experiences to developers and users, which will only cause an upward spiral of innovation to make conversational software better and better.
What no one has spoken of yet is the potential that the open Lex environment offers to businesses. Consumer e-commerce is great, but integrating Alexa with industrial facilities could boost Amazon Business far and away past its competition and propel the company to reaching a trillion-dollar valuation.
Purchasing managers in a factory could order new tools and parts via Alexa and trigger the fulfillment by Amazon's B2B sellers, making the process far more frictionless than the likes of its competitors, such as Grainger and Arrow Electronics.
Even further, developers could build chatbots to seize upon the Industrial Internet of Things (or the Internet of Big Things, depending on whom you ask). As the world's factories come online and become increasingly connected, the ensuing dataflow will be massive and in need of wrangling.
With the right tweaking, Alexa could become the engine for a development platform for the factories of the future. Not merely chatbots, but machine intelligence-enabled applications that optimize and automate operations and, probably, replenish their supplies using Amazon Business.
Opening Lex will bear out to be an amazing choice on Amazon's part. The only question is how far will its leadership take the initiative and if they'll properly actualize the potential.