Apple and the garden of eden. Dont take a bite unless you're going all in

This makes no sense to me. Apple's plan works because... their lock-in is better? I can "control most of the lights in my house, stream Apple music and set kitchen timers" with Alexa, Google Assistant, Cortana and even Bixby. What is Apple's actual advantage here? How is Apple making money from this when Amazon does not?

Apple makes money from the devices it sells. Siri makes those devices more convenient to use.

Amazon is selling the devices at or below cost and hoping that Alexa will make the money (which it doesn’t)

That only tells me which one will exist longer, not that "Apple's plan works". I've genuinely seen zero people deliberately use Siri (on iPhone or Mac) over the past 5 years. Apple is certainly losing money on Siri too.

If you look at Siri in a vacuum, you're almost certainly correct that it isn't a moneymaker. But Siri isn't in a vacuum. It comes with a device with an average cost of like $1000. It may not necessarily be widely used, but the ones who do use it are highly likely to remain in the Apple ecosystem and use other products and services that are highly profitable.

Look at all those Korean novelas and shovelware on Netflix. There are cohorts of subscribers who remain highly loyal because they're into it. Netflix isn't necessarily swinging for the fences with high brow, popular content that competes with the best studios in the world. Instead, they pump out a wide variety of content that keeps the maximum number of people subscribed.

Apple is similar. They promote features - whether it's Siri, health, privacy, family sharing/controls, etc. - that will strongly appeal to some cohort and keep them on the platform. Then, they incrementally hook you into services until you're buying $1000 devices for the whole family and paying $30/mo for the services bundle. And once you're there, they have you because the switching cost involves turning your digital life upside down.

I was one of those zero people until i realized i can tell Siri "add an appointment with Blahblah next tuesday at 11", it will actually understand that and it takes less time than using the calendar interface.

I'm sure enough people find some small use for the voice commands that it's a good feature to have on the phones.

Siri really shines with the HomePod or the watch I’ve found.

It works well on phones for things like setting calendar events, timers, reminders, playing music.

Apples devices are smarter. This makes them cost more for the "same" hardware, but costs less for the computation.

Apple isn't trying to make money with Siri. It's using Siri to make its ecosystem of Apple Music and similar more valuable to its customers.

The limits that Apple puts on what it can do makes that cloud side computation less expensive.

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Consider that bit - less expensive. Apple doesn't run its own cloud in the way that Google, Amazon, or Microsoft do. So what does Alexa cost? It costs for AWS cloud time. That's the expense that it's running. Those skills that people use run on AWS compute time rather than a phone's local cpu and battery.

A google search "costs" about 1 KJ of energy. Alexa has similar costs somewhere just for energy and other costs for the maintenance of the additional software and content. It costs something to maintain that joke database.

I don't think Apple is smarter. Siri is really basic.

I can't even say "Turn on the lights and the fan". I have to present it all in bite-sized chunks. Come on how hard is that.

I have a feeling there is no AI in these supposedly intelligent assistants. Only scripted stuff.

There is more processing done in the Siri local device than there is in the Alexa local device.

It's not "Siri is smarter" but rather "Apple is working on minimizing cloud costs because it is entirely a cost for them."

Siri is scripted and limited to make it locally "smarter".

With Amazon and Alexa, everything goes to AWS because that's where the entirety of Alexa's processing happens. The hardware devices in the homes are "dumb" terminals for AWS with a voice interface. This allows Amazon to make use of AWS as much as it can and do something with "surplus" computing power that it has available on AWS.

Amazon has been working on on-device voice for a while. Actually everyone is trying to do that. Running large speech models in the cloud is expensive, considering the number of devices, they probably need more than "surplus" :)

https://www.amazon.science/blog/on-device-speech-processing-...

It could certainly rack up a big bill.

This is also part of the work that Apple has done (and is likely part of the making Siri cost less for cloud compute).

https://www.macrumors.com/how-to/use-siri-offline-ios/

> In iOS 15, Apple moved all Siri speech processing and personalization onto your device, making the virtual assistant more secure and faster at processing requests. This also means Siri can now handle a range of requests entirely offline.

> Once you're using iOS 15, you don't need to enable anything for Siri to work offline. The types of requests that it can handle without phoning home to Apple's servers include the following:

    Create and disable timers and alarms.
    Launch apps.
    Control Apple Music and Podcasts audio playback.
    Control system settings including accessibility features, volume, Low Power mode, Airplane mode, and so on.

I didnt disclose as I was not gonna promote anything, but I work for a startup specializing in on-device voice recognition. I am 100% biased towards on-device voice processing :)

i just wanted to share my 2 cents, as it's not unique to Apple and the cloud can be costly even if you own it. Big tech has been investing in on-device for a while. besides voice commands, apple and google do transcription locally too. because now you can have local speech to text with cloud level accuracy and of all the reasons you shared - cost, privacy, latency etc. (but again, i'm biased)

https://www.androidauthority.com/voice-typing-opinion-322134... https://techcrunch.com/2022/05/17/apple-adds-live-captions-t...

Interesting! Is that also the case for the homepod (and homepod mini which I have)?

I don't know if it's device specific but I use "Hey Siri, turn on the overhead lights and the floor lamp" for example all the time. I have a HomePod though.

Weird, I have a homepod (mini) also. In fact I hardly have any Apple stuff anymore, I only got homepods because it was the most privacy-friendly option out of the big three. I just have an iPad from work which I used to set them up. And most of my automation goes through Home Assistant anyway.

When I give a double command Siri literally tells me she can't do two things at the same time and I have to present them as two separate commands.

Perhaps it's because I have it set to UK English? Perhaps it's smarter in US English. I'll have to try that.

> Perhaps it's smarter in US English. I'll have to try that.

Most companies treat you know English as European, and European customers as second in line for new features after America.

Or more specifically, treat American English first for voice control stuff.

There is no AI beyond run of the mill NLU/ML stuff. It’s just trying to guess intent based on your query.

“What’s it like outside right now?” => GetWeatherIntent arguments=[time=current location=device_location]

There’s no Omni intelligent being making API calls anywhere. It’s NLU with a decision tree(s) based on the intent and arguments

I think the point is that apple produces software that doesn't directly make them money as part of their business model. Pages, Numbers, iMovie, Maps are all given away for “free” with devices. Siri is just another example of that. As you say, being able to talk to your phone is table stakes, not an advantage. But having that offering keeps sales of Apple hardware moving.

Seems odd right? Just charge more than break-even for Alexa and you have a business?

Not necessarily because the cost increases through increased use by the customer. The idea was to sell hardware at close to cost and then monetize the customer. The likely assumption was that Alexa users would buy more similar to how Prime customers buy more. Ideally, Alexa customers were supposed to use services like "subscribe and save" and then randomly tell Alexa to order more toilet paper or laundry detergent. Amazon wanted all the household stuff on recurring subscriptions. It would have been great. Increased revenue, better ability to bundle shipments together to cut costs, customers who don't even look at prices anymore. Instead, they sell a device for which they incur an operating cost while producing little to zero increased revenue and subscriptions.

Right, I read the Ars Technica article, I get the original idea. It turns out that monetization strategy doesn't work and the Alexa business unit is losing billions of dollars.

I'm saying, new business idea: give up on the old strategy of Alexa driving induced profit in other business units, instead charge more than the breakeven cost of building devices and running the service. This will likely be substantially more, and fewer Alexas will be sold. But the users that do actually get a lot of value from the device and service they are using will pay more for it.

The product/market fit to test is: How many customers would pay more for a device that's not trying to sell you things? Can you get a solid (but smaller) business just by charging more for the device? What features would you add to persuade the marginal user to pay more? Offline mode for privacy-conscious users? Lean in to home automation features? What about a true AI-powered personal assistant? What about per-user language training with a local model that gets refined by your voice samples, with that data not shared back to the cloud? Etc.

Simple startup-style product iteration stuff here. You had a customer hypothesis and a growth model, and it was proven unviable. So can you pivot to find a viable business?

Charge more than break even for Alexa and they won’t sell enough.

> Apple isn't necessarily in the same boat.

Also importantly, Siri mostly runs off your iPhones processor, and apple doesn’t have to pay a big cloud bill for it, unlike Alexa.