VW first OEM to embed Amazon’s Alexa voice service as Amazon’s autonomous strength grows
January 24, 2017
Volkswagen is to become the first manufacturer to embed Amazon’s Alexa voice system directly within the vehicle, as the market for a network of automotive and home appliances gathers steam and Amazon secures a dominant position.
The integration of the connected car market with the connected home market is inspiring collaborations between carmakers and technical service providers such as Amazon. SNS Telecom Research expects that connected car services will generate global revenues of $14 billion by the end of 2016, driven by uses including infotainment, fleet management, remote diagnostics and usage-based insurance. The sector is expected to grow at a double-digit rate for the rest of the decade – 31% a year between 2016 and 2020. Read more about these market trends in Autovista Intelligence’s report The Intelligent Car.
While other carmakers including Ford, BMW and Hyundai are introducing Alexa, these solutions only work via a smartphone app which connects to the car’s infotainment system. This is seen by carmakers as a sub-optimal solution, as it risks the car technologies being controlled by smartphone OS manufacturers such as Apple and Google. Volkswagen’s solution directly integrates Alexa as a feature in its own connected car system, bypassing Google and Apple.
Carmakers have turned to Amazon to help provide connected car services in part due to fears over Apple and Google controlling the connected car sphere. With the digital user interface set to become a core aspect and key differentiator in the driver experience, alongside autonomous cars, there is a risk Apple and Google digital control could reduce the car manufacturer to a utility-like role. The head of Ford’s connected car project has said Amazon has become a natural ally for its plans.
Using Alexa, drivers will be able to make instructions to their connected home from their car, such as turning on the heating or boiling the kettle.
Volkswagen showcased a Tiguan SUV at the Consumer Electronics Show with a voice command system that responds to keywords such as ‘Hey Volkswagen.’ Volkswagen has programmed several keywords that customers can choose from. For example, you could ask: ‘Hey Buddy, ask Alexa how warm is it at home?’
The system works both ways, so before leaving the house, you could request: ‘Alexa, ask Volkswagen how much fuel is left in the tank,’ opening up a powerful range of possibilities. Features will be available in all markets.
Amazon has become the dominant leader in voice recognition through Alexa and Echo, with sales of Echo estimated at approaching 20 million units since launch in November 2014. Google is suffering as a result of late entry into the market with Google Home in October 2016; its sales are under one million. This threatens Google’s core revenue stream if Google fails to gain a foothold in this new search market, as it did successfully with Android in smartphones. Amazon is also seen as a more natural partner for carmakers, with its commodity-based businesses model fitting better than Google’s data-based model. The latter allows Google to gain significant control over vehicle data.
This conflicts with the desire of many carmakers, with SEAT saying about data privacy: ‘For SEAT, this is a very clear issue. Data belongs to our customers.’ Opel has also said: ‘We do not track any data, so there is no log file being transmitted.’
Amazon is making gains in other areas of the expanding automotive industry. It has recently filed a patent for communications between autonomous vehicles and road management systems on reversible lanes, to optimise traffic flow. There is a logical strategic fit; Amazon is always looking for ways to increase efficiency in its core delivery business and optimising the routing of autonomous delivery vehicles could be a fundamental step in this. The company has also been rumoured to be a potential investor in HERE, a high-definition mapping service that is owned by a number of carmakers including Audi, BMW, and Daimler and working with a broad range of auto and tech companies real-time navigation data services.
Volkswagen’s Alexa integration will work alongside its new Volkswagen User-ID system, that allows the Volkswagen connected car system and user preferences to be independent of the car and transfer from one vehicle to another.