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Why LG's new Google-powered speaker is a key market development (GOOGL, GOOG)

The new speaker is part of its newly rebranded ThinQ line of smart home products

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LG worked with Google to integrate Google Assistant into the device and allow hands-free operation. Consumers will be able to activate the speaker using a wake-up phrase, ask the artificial intelligence (AI) powered assistant general questions, play music, and control smart home devices — both from LG’s ThinQ line as well as others compatible with Google Assistant. The speaker will feature most of the capabilities of Google’s own Home line of smart speakers.

While Google and Amazon are the biggest names in smart speaker hardware right now, they’re both taking steps to get other companies to make speakers powered by their voice assistants. Amazon has been pursuing this strategy for over a year, with companies — including LG and Lenovo — announcing smart speakers and other connected devices featuring Amazon’s Alexa voice assistant at CES last year. In May, Google releaseda software development kit (SDK) to allow developers to start testing out ways to incorporate its Assistant into speakers and other smart home devices.

Getting a variety of devices at various price points onto the market is critical for Google if it wants to compete with Amazon for the smart speaker market. Amazon sold millions of Echo devices over the holiday season, and 61% of smart speakers owners said they plan to buy more speakers as well — most likely powered by the same voice assistant.

Google introduced the Home Mini and Home Max smart speakers last fall, but it will likely follow the strategy it pursued in other sectors like the smartphone market and only offer a limited hardware lineup, leaving room for partners like LG to help it offer a wider variety of devices that can push more consumers to buy Google Assistant-powered speakers. There’s also further opportunity for other hardware companies to work with Google and Amazon to incorporate the voice assistants into their connected home devices.

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  • Apple’s HomePod looks likely to find a place in the smart speaker market but won’t dominate its space like the iPhone or iPad did.

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