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An image of a phone using Google Now. An image of a phone using Siri. An image of a Cortana advertisement.

Tech Market Brief - Virtual Personal Assistants

Introduction

Virtual personal assistants controlled by one’s voice are becoming more and more popular as their feature sets expand and as voice recognition technology advances. In fact, Andrew Burger of TeleCompetitor said that an estimated 2% of US households will have a virtual personal assistant by the end of the year. A number of large companies have created their own individual voice activated virtual personal assistants; the most notable being Amazon, Google, Apple, and Microsoft. They all have distinct features and abilities, but a few are locked to a single platform, making direct comparisons difficult. However, it is readily apparent the impact each is having on the market.

Siri

Distinct Features

The first is the most well-known of all the virtual personal assistants, Siri. Siri is one of the virtual assistants that is locked into a platform, that being the iPhone. This is disadvantageous in a couple of ways. It keeps Siri from stealing market share from Google and Microsoft on their platforms, and means that if someone wants to use Siri they must purchase one of Apple’s comparatively expensive products. This makes it slightly more difficult to differentiate between Apple’s hardware market share and Siri’s market share among the virtual personal assistants. Despite this, being so closely tied to such a popular and ubiquitous platform, and having entered the market early, gives Siri a unique position to shape the market going forward.

Market shares and Impact on Larger Market

Being the second virtual personal assistant on the market, following shortly after Google Now, Siri has helped craft the expectations consumers have on what a virtual personal assistant should do and what their abilities should be. Namely, Siri can deliver information in response to questions by the user and in the event that Siri could not answer a user’s question she searches the web in the hope that the user will find it there. Siri can also set alarms and appointments on the calendar, call or message someone in your contacts, and make jokes. In particular, the joke making feature, being apparently superfluous, made its way into almost all of the later virtual personal assistants. This is notably prominent in the United States, which has the largest market for virtual personal assistants of around 245.6 million USD. This influence over the United States market shows in the research done by Mindmeld Labs. They found that Siri held around 40.4% of the virtual personal assistant market. Unfortunately the fastest growing market for virtual personal assistants is the Asian Pacific market where Android holds a large majority of the market share. According to Demystify Asia, Android has anywhere from a 58% to 98% market share, compared to between 49% and 55% in the United States. (Yahoo Tech, 2014) This may mean Apple and Siri’s influence in the virtual personal assistant market may shrink going forward.

Google Now

Distinct Features

Unlike Siri, Google Now is available on multiple platforms, including iOS. Google Now has less conversational options in favor of optimizing the features that make it more like a personal assistant. It has many of the aforementioned features of Siri such as appointment making and web searching, but it also integrates into many of Google’s other services. It can make appointments just from information in your gmail emails for example. It also has the advantage of being closely integrated into Google’s search engine, the most powerful and most used search engine on the market with 88% worldwide market share claims StatCruncher. (The Motley Fool, 2015) This makes its web searches much more powerful than Siri’s. Google is also developing neural networks to assist their processing. The integration of a learning machine in a virtual personal assistant would be a huge advantage. In addition, Ask Your Target Market conducted a survey and Google Now users were 5% more likely to be satisfied with their virtual personal assistant experience. (2015)

Alexa

Distinct Features

Amazon most recently released Alexa, their own virtual personal assistant. Unlike Siri, Google Now, or Cortana, Alexa was not designed to be used with smartphones. Alexa was created to go with Amazon’s Echo series of devices. The Echo series was designed around having a voice assistant that relied almost exclusively on voice, with little other interface involved. The original Echo was just a large speaker with internet connectivity for Alexa’s functionality. Amazon recently released the Echo Dot to allow one to use their own speakers. However, Google is developing a similar product linked with Google Now called Google Home. Google home is a speaker very similar to the Amazon Echo, and will be able to answer questions in a similar way, but leveraging Google Now instead. Alexa was also created with a very unique feature. While Alexa does have many of the same search features as Google Now or Siri, it does not have many options for making appointments or reminders. Instead it has the ability to order items directly from Amazon using only your voice. It is also ready to be integrated into many of the "smart home" appliances available. These are uniquely powerful features that makes Alexa more suited for home use as opposed to being on a mobile device.

Market shares and Impact on Larger Market

Alexa’s main hurdle is getting into the virtual personal assistant market later than Siri, Cortana, or Google Now. This is where it’s specialty in ordering objects and controlling "smart devices" comes in. Alexa represents Amazon looking to the future of the virtual personal assistant market and where it is merging with other budding markets. Taking advantage of the exponential growth of the "Internet Of Things" market, it is already integrating and preparing to take advantage of home controlling devices. Ironpaper reports that Gartner estimated "Internet Of Things" revenue to exceed $300 billion by 2020, and that TechNavio expected it to grow at a CAGR of 31.72 percent between 2016 and 2019. (2015) Thanks to its fairly new status, and its specialized nature, it has yet to break out into the virtual personal assistant market with only 2.1% of consumers using Alexa as their primary virtual personal assistant according to Mindmeld. (Search Engine Land, 2015) However, Amazon is pushing advertising, and as its features grow and the current features gain popularity it is expected to expand.

Cortana

Distinct Features

Microsoft made Cortana to go along with the newer Windows 10 and its line of phones to compete with the likes of Siri and Google Now. One of the biggest advantages of Cortana is that it is also integrated into the Windows 10 desktop operating system, giving one a virtual personal assistant on their computer, the same one that was also on the Windows phone. Cortana is also available for Android phones, giving Cortana an advantage over Siri since Siri is locked to the Apple platform. Cortana includes many of the features already implemented by Google Now, and boasts unique features on the desktop version. It integrates with the search functionality present in Windows since Windows 7 and allows one to search through their files on their computer using Cortana.

Market shares and Impact on Larger Market

Cortana appears to be doing only slightly better than Alexa where market share is concerned. Mindmeld Labs found that only 6.1% of consumers used Cortana as their primary virtual personal assistant, compared with 25.9% for Google Now and 40.4% for Siri. (Search Engine Land, 2015) Similarly to Alexa this seems to be primarily due to their later entry into the market. With Siri and Google Now already firmly established Cortana had to find a way to set itself apart. In an attempt to leverage their existing intellectual property they named the virtual personal assistant after a well known artificial intelligence in one of their most popular video game franchises. Another factor hurting Cortana’s adoption is the abysmal market share of Windows Phone. Android and iPhone have long held the largest shares of the market in this area, and since they ship with Google Now and Siri respectively few users feel the need to download another.

Conclusions

Of the largest virtual personal assistants, Siri is the most adopted owed largely to the popularity of the iPhone in the United States. Despite its lower adoption rate compared to Siri, Google Now has a higher satisfaction rating among consumers on average. In addition to these, the newest contenders, Alexa and Cortana, show promise as their feature sets grow and they find their niche in the growing market. The two have very unique features that set them apart from Siri and Google Now. In a young and growing market like that of virtual personal assistants, any of these could expand rapidly and take the market by storm. They could also be impacted by other growing markets in the tech industry, from the "Internet Of Things" to neural networks, making this market possibly volatile and highly unpredictable.