Big Tech battle over AI voice assistants heats up, technology continues to evolve

The news: Although voice assistants are one of the most important on-device AI features for consumers, no Big Tech company has come out with a market-dominating AI assistant yet.

• Amazon’s plans to improve and enhance its Alexa assistant with AI were pushed to 2025, more than a year after an AI-enabled Alexa was first demoed.
• Apple added ChatGPT capabilities to Siri, but delayed generative AI (genAI) improvements have hampered consumer excitement.
• Google added Nano as the default AI for Pixel phones, with practical features like scam call detection, but it could dissuade privacy-conscious users.
• Dedicated voice assistant wearables flopped, pushing AI startup Humane to pivot its Ai Pin into a software offering.

Zooming out: We expect that market share for voice assistants will remain relatively flat this year, with Alexa’s user base forecast to grow 2.6% YoY, Siri’s 3.3%, and Google Assistant’s 4%, per our forecast.

While both Amazon and Apple have lagged in the genAI game, both made strides toward the end of 2024, including with an AI voice generator from Amazon Web Services (AWS) and Siri improvements from Apple.

Adverse effects: AI assistants’ advancing capabilities are bolstered by how sophisticated genAI voice technology is.

While this is positive for Big Tech, it poses a danger to consumers. Hackers can create hyperrealistic voice clones of trusted sources or public figures, which can easily trick people into giving up personal or financial information over the phone.

The US doesn’t have federal regulation to oversee AI voice technology, but we could see this enacted as companies such as OpenAI launch highly voice-cloning tech.

Where to grow next? Even as many companies scale up their voice assistants, a large portion of the population remains either in the dark on how to use the technology or have no interest in it.

• Only 39% of boomers use an AI-powered voice assistant daily, per ThinkNow Research, compared with 70% of millennials and 51% of Gen Zers.
• 33% of smartphone owners between the ages of 18 and 34 use or would use a voice assistant, per YouGov, compared with just 20% of those over 55.

Companies that are looking to grow their user bases would benefit from targeting Gen Z and millennial users or parents of tech-native Gen Alpha.

Our take: New voice assistant companies will struggle to break into the market against Big Tech giants’ entrenched user bases and well-known models. Even they will face challenges though—AI is expensive, and implementing subscriptions to offset costs could cause consumers to resist.

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