Google CEO Sundar Pichai dodges analyst questions on monetising voice search in smart speakers

Google introduced the Google Home smart speaker in the last quarter of 2016, in an effort to take on Amazon, which has the extremely successful Echo . The competition is expected to heat up next year in the segment with smart wireless speakers from Microsoft , LG , and Lenovo . Wireless speakers with virtual personal assistants within them are expected to be a $2.1 billion market by 2020 .

In a conference call on Alphabet’s quarterly financial performance, analysts asked some hard questions to Google CEO Sundar Pichai on what role smart speakers from Google and voice search play in the future. Google is in danger of being left behind. Mark Mahanay of RBC and Douglas Anmuth of JC Morgan both quizzed Pichai on how Google will navigate the transition from screens to voice based interfaces.

Mahanay pointed out that Google hardware performs a tenth as well as competition when it comes to sales. Ruth Porta, CFO of Alphabet and Google responded that while the hardware business was just taking off, they were in profit. Pichai’s response was that the new paradigms were just emerging, and that Google is “comfortable” in the space going forward. Pichai said that Google is looking at making voice interface work across homes, phones, tvs and cars. The work that Google is doing in Natural Language Processing (NLP) will allow Google to be a major player going forward, according to Pichai.

Addressing the issue of monetising voice search, Pichai pointed out that voice search was only a part of the journey that users take when it comes to finding information, and is only one of the ways that users interact with machines. When they get to touchscreens, there is a need to continue where the voice conversation left off, which is where Google can play at its strengths. “We want google to be available to people when they need it,” Pichai said, “we think of this as an end to end thing”.

However, Pichai offered no concrete answers on how exactly Google plans to stay competitive when it comes to Google hardware or how advertisements will be pushed to users who interact with computers primarily through the medium of voice. Pichai pointed out that it was the very early days of voice search, and that he looked at voice search more as an opportunity rather than a challenge. The entire conference call is available on YouTube , the questions from the two analysts about voice search starts at 35:55.