Nov. 6 (Bloomberg) — Amazon.com Inc. unveiled a voice- controlled interactive speaker called Echo that lets people stream music and search the Internet, as the company works to extend its reach into consumers’ digital lives.
Echo is priced at $199, Amazon said on its web site today. Members of Amazon’s Prime fast-shipping program can purchase the gadget for $99 for a limited period. Consumers need to request an invitation to get the product.
Chief Executive Officer Jeff Bezos has been spending on new devices to tie people more closely to Amazon, and Echo expands the company’s new hardware offerings this year, which also include a smartphone and set-top box. Last week, the Seattle- based online retailer unveiled a media-streaming device, the Fire TV Stick, which plugs into a TV set to let users browse video and music from NetflixInc., Pandora Media Inc. and other content services.
Amazon introduced Echo with little fanfare, simply putting up a Web page about the device. In April, Amazon similarly unveiled Dash, a barcode scanner and image-recognition device. Dash also has speech-recognition capabilities, with people able to push a microphone button on the device, say “chocolate chips” or some other item, and have the products deposited into their online Amazon shopping cart.
Many of the new devices are the result of work from Amazon’s Lab126 facility in Silicon Valley. Amazon has made at least two acquisitions of speech-technology companies in recent years.
Craig Berman, a spokesman for Amazon, didn’t immediately return a request for comment.
Amazon’s “Echo will only achieve its real purpose when you start asking it questions, having it complete tasks for you—especially shopping tasks—just the way Apple hopes its users will interact with Apple Watch,” says Forrester Research analyst James McQuivey.
“Although every platform wants to put microphones into your home, Amazon has a unique ability to monetize the microphone, principally by putting microphones in places where you will think of things you want to buy—the kitchen, the bathroom, the living room—things which Amazon can then easily fulfill. It’s so clear that Amazon would want to do this that we predicted it in April, explaining that Amazon has the interest and the skill to pull off this kind of persistent voice interface — an interface Forrester calls Vox,” McQuivey says.
Noting that Amazon is “still reeling from its FirePhone experiment which came too late to join the mobile phone party,” McQuivey says this voice-controlled interface may be too early. “But,” he adds,”there’s no better way to find that out than to try; Amazon’s limited rollout of Echo to its Prime users is exactly the right way to try.”
Amazon said on its web site today that Echo works when a consumer speaks the word “Alexa” to wake the device up. The gadget is connected to the Web and runs on Amazon Web Services, the company’s cloud-computing service. Over time, Echo can adjust to consumers’ speech patterns and personal preferences, Amazon said.
Echo faces competition from other providers of connected speakers including Sonos Inc. and Jawbone. Jawbone offers a line of connected streaming home speakers called Jambox, in a range of colors and sizes costing $130 to $300. Sonos makes speakers starting at $199 that let people stream music from computers, mobile devices and online services such as Pandora and Spotify Ltd.
Some of Amazon’s hardware offerings have flopped in the past and it’s unclear whether the Echo will have mass appeal. Last month, Amazon reported a $170 million inventory charge for the third quarter related to excess supplies of its Fire smartphone.
Michael Pachter, an analyst at Wedbush Securities in Los Angeles, said he doesn’t understand why people might be tempted to purchase Echo.
“I think it’s just a two-way speaker, but why isn’t there just an app that lets me do the same thing without having to spend $99 on hardware?” he said. “I think this is a solution that is seeking a problem.”
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