I have one of these speakers at home. A birthday ago I received a box that contained what should have been the peak of smart gadgets. Nearly a year on, and the speaker is still on its way into what it claims to be.

To be fair it has improved and ‘learned’ a lot since I opened the box; I tell the speaker when there are no more tins of baked beans in the larder, and the speaker dutifully updates our shopping list on our mobile phones. I ask the speaker to play any song or any album, and it does just that. And if I forget how long an egg takes to boil, the speaker has an answer as well acting as a timer.

That is all great, but I do not suppose that, at this point, it’s revolutionary. Still I believe that the smart speaker will be a fulcrum around which future technology will evolve and a product that will determine the winners and the losers in the tech industry. Ultimately it’s the showcase of what is to come. Here is why...

First of all, a smart speaker is a type of wireless speaker with voice command device and usually with an integrated virtual assistant. The virtual assistant is a form of artificial intelligence that offers interactive actions and hands-free activation of application, appliances and other gadgets.

I feel the need to explain this, because as recently as yesterday I described the above to an IT guy, and, as far as I know, none of the major manufacturers offer the speakers specifically for Malta.

Smart speakers can also typically act as a smart device that utilises wi-fi, Bluetooth and other wireless protocol standards to extend usage beyond audio playback, such as to control home automation devices.

This can include switching on and controlling lights, launching programmes on the TV and answering and making calls. Some speakers already have the capability of controlling home appliances such as air conditioning and fridges, checking availability and booking tickets, booking transport and finding and making reservations at restaurants.

If you are mixed up, let us try and explain the process. Let us say for a moment that your smart speaker is called Fido.

You get home from work and you tell Fido to switch on the lights. Fido switches on the lights.

You tell Fido that it is too hot. Fido switches on the A/C.

You ask Fido to start playing the next episode of Narcos in the living room. The TV in the living room starts playing the next episode of Narcos.

Your wife suggests going out for pizza. So you ask Fido for a suggestion for a Pizza restaurant in Valletta. Fido suggests the highest rated Pizza restaurant in Valletta and asks if you want a booking.

You reply ‘Yes’ and also instruct Fido to book a taxi.

The taxi arrives at your desired time.

All the above is already possible through available smart speakers. What remains in practice is the integration of the various technologies and services, plus the sometimes high costs that still exists. For example a single 9W bulb that works with a smart speaker costs around €20. And in some regions, like Malta, taxi services and restaurant bookings are not yet integrated.

However, one can already envision the potential for the likes of Amazon, Apple and Google. First there is the speaker, but that will lead to a music subscription, probably a TV and film subscription and eventually replaceable products such as smart lights and smart appliances. The revenue generating potential is immense.

Amazon’s smart speaker is called Alexa and is probably a step ahead of the competition if you want smart-home controls. Also Alexa as a digital assistant is constantly improving.

Google Home has the advantage of Google’s search and voice control, plus the ability to tie the various Google apps such as calendar, maps, traffic etc. I do believe that Google has probably the most potential.

Apple recently offered the HomePod; it comes with excellent sound, so it is ideal for those having a subscription to Apple Music. However, for anything else, at this point the other two are better.

The smartphone super-cycle is probably defunct, but not without having first left behind losers (example Nokia), big losers (example Blackberry) and big winners (obviously Apple). What comes next may not be a game changing product but the integration of apps, services, smartphones and gadgets. The smart speaker is at the centre of all this, and the race to get into everyone’s home is on.

Amazon and Google seem to be ahead, but Apple’s strength always lies in letting others take the lead before coming out with a killer product. Ultimately I believe that these three firms still have immense growth potential. Riding the wave of this technological leap in the form of investment in these firms is probably not a bad idea.

Disclaimer:

This article was issued by Antoine Briffa, investment advisor at Calamatta Cuschieri. For more information visit, www.cc.com.mt. The information, view and opinions provided in this article are being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice.