Alibaba to build $1.4-billion ecosystem around its smart speaker

Jane Zhang, South China Morning Post

Posted at May 21 2020 08:31 AM

Jack Ma, founder and executive chairman of China's Alibaba Group, speaks in front of a picture of SoftBank's human-like robot named 'pepper' during a news conference in Chiba, Japan. Yuya Shino, Reuters/file

Chinese e-commerce giant Alibaba Group Holding will invest 10 billion yuan ($1.4 billion) this year to strengthen the artificial intelligence and Internet of Things (AIoT) ecosystem around its smart speaker Tmall Genie as Chinese technology companies bet billions on what is expected to be the next big thing after smartphones.

The investment aims to expand Tmall Genie's AIoT ecosystem by integrating more content and services from Alibaba's ecosystem, ranging from entertainment to health care, education and online shopping, according to a company statement on Wednesday. Alibaba is the parent company of the South China Morning Post.

Under the initiative, mini-apps on payments platform Alipay can be integrated with Tmall Genie starting from July 1. Consumers can also watch Taobao Live " the live-streaming of merchant sales on Alibaba's Taobao Marketplace retail platform " through Tmall Genie's screen.

In addition, the investment will see more AIoT technologies developed in-house, including an IoT operating system, edge computing, and visual and voice AI, the company said.

Tmall Genie will share its latest AIoT technologies, vertical market insights, product design skill sets as well as content and service capabilities with partners to co-develop intelligent products, such as refrigerators, robot vacuum cleaners and smart sportswear.

"By tapping into Alibaba's diverse ecosystem and cutting-edge technology, we are committed to bringing in more unique experiences to our Tmall Genie users through enriched content and services," said Ku Wei, who heads the development of Tmall Genie.

As one of the world's fastest-growing smart speaker markets, China saw "explosive growth" of 110 percent in shipments of the device last year, according to IDC. The top brands remain Alibaba, search giant Baidu, and smartphone and appliance maker Xiaomi Corp, which make up more than 90 percent of China's smart speaker market.

The stakes are high for Chinese vendors which have helped drive global shipments of these connected devices. These companies see the potential of tapping into a huge new user base, as more consumers become comfortable with voice-command methods on connected devices at home.

Tmall Genie CC10, the latest model which boasts a large 10-inch screen, debuted on Wednesday priced at 549 yuan. On the same day, a partnership between Tmall Genie and American fast-food chain KFC was also announced, involving the joint development of a KFC-themed smart speaker. In the second half of this year, consumers will be able to order breakfast at KFC using the smart speakers' screen and complete their order through a voice payment function.

"We are also partnering with brands to offer our leading AIoT technology, design ideas and go-to-market advice, so they can be empowered to explore opportunities in the AIoT era, and more smart products can be rolled out to the market to enlighten consumers' daily life, too," Ku said.

Despite a sharp drop in first-quarter sales because of the coronavirus pandemic, smart speaker shipments in China are projected to grow 9.8 per cent in 2020, according to data from IDC.

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