CES Day 3 – Floor stories

Alexa goes endgame, Chinese disguise & HERE.

Google vs Alexa – White suit brigade

• At a high level, it looks like Google has almost given up on the smart home, but this is not quite the case as it has merely moderated its strategy.
• Google is no longer unique to the Las Vegas Metro nor is it plastered all over the convention centre and the discussions around digital assistant support have completely disappeared from the booths of smart device makers.
• This is because everyone knows that everything will support Alexa which given Google’s failure to make real in-roads into Alexa’s dominance for the last 1-2 years is the obvious way to go.
• Google is down further but still not out and this year it is focusing its efforts on the floor where, in the smart home section, its people in white suits are simply everywhere.
• A large number of smart home device makers have a Google Assistant person on the booth, and I suspect that Google has made a contribution towards the cost of the booths where it is featured.
• I think that this strategy has backfired somewhat because in the eyes of the press and the industry analysts (i.e. at the press events) it almost seems as if Google has given up the race.
• I don’t think that this is the case just yet, but its continued lack of progress in this area indicates that this could be on the cards at some point soon.

Chinese in disguise.

• One of the most striking changes from last year is that many of the Chinese consumer electronics companies have come to the show in disguise.
• At the press events, Chinese companies who are aiming to sell products into the US market now have Western executives at the press events rather than Chinese.
• This is a big change from 2018 where Chinese products were being almost exclusively represented by Chinese executives and salespeople.
• Huawei’s cover is already blown thanks to its entry onto the entity list in 2019 which was widely covered by the press.
• However, the lesser-known brands are not on this list, are largely unknown and in many cases, I suspect that the press won’t realise that the product is Chinese in origin.
• This is probably a wise move as sales in the US market in the current climate are likely to be easier while this illusion persists.

HERE – chipping away

• It has been pretty quiet on the location front with barely a peep out of Google with most of the noise coming from developers moaning about Google’s exorbitant price change for access to Maps that went through last year.
• HERE also has not made any really big announcements at the show but what you see under the hood is a steady chipping away that is gradually bringing it closer to its long-term ambitions.
• A partnership with Bose for better navigation audio, reaffirmation of its Chinese partnerships despite the current climate, a deepening of its partnership with Verizon for 5G and proper lane guidance are all new things that have been announced.
• This combined with the new Japanese shareholders (Mitsubishi Corp & NTT Data) enhance both its credibility outside of automotive as well as its APAC chops.
• Both of these have been key strategic initiatives for some time.
• Map revenues are eventually going to go away and HERE is not resting on its laurels but making a big effort to adapt to how the industry is changing and make the most of it.
• Conversely, If the vehicle OEMs could accept that making metal boxes on wheels is not a viable long-term strategy, then they would have a much better outlook than they currently do.