Report: Facebook to enter crowded smart speaker market

Dive Brief:

Facebook is reported to be developing a smart speaker with a 15-inch touchscreen, according to Digitimes, which cited unnamed sources.
Business Insider also recently found a patent from the social media giant's consumer hardware lab Building 8 for a device that matches the features of a smart speaker.
The new device is said to be manufactured by Taiwanese-based Pegatron Technology and will be released in Q1 2018, Digitimes said.

Dive Insight:

Producing more hardware would present a major pivot for Facebook and would place the social media giant in an ever-more crowded and competitive smart speaker market that includes Amazon's Echo products, Google Home and newer arrivals from Microsoft and Harmon Kardon and also Apple. Facebook has dabbled in hardware before but seen little success outside of offerings like its virtual reality (VR) Oculus Rift headsets. Even then, Oculus has had to recently slash prices to become more appealing and affordable after failing to see any sigificant traction in the mainstream.

Facebook is likely counting on its name recognition and 2 billion monthly users to gain early market share, along with a suite of products that includes everything from Instagram to Messenger and a fresh slate of original video programming on its core platform. However, the company doesn't have the established reputation as a physical product manufacturer like Apple or Microsoft, nor does it have a noteworthy digital assistant like Cortana, Alexa or Siri to integrate into its speaker. Business Insider said the rumored device might be just the tip of the hardware iceberg for Facebook, however, as it staffs up Building 8 with talent from Apple, Google, Motorola, GoPro, Walmart and Amazon.

The rumored device would compete most directly with the Amazon Echo Show, a model that combines a smart speaker with a touchscreen and voice technologies. Echo Show was released at the end of June. While the digital assistant space includes a variety of brands, Amazon has proven to be the early leader with its own hardware as well as third-party devices that utilize Alexa tech.

More broadly, the number of Americans who use a voice-activated assistant like Amazon Echo or Google Home at least once a month will more than double this year to 35.6 million, eMarketer estimates. The key for Facebook's upcoming device will be to provide a distinct mix of content and functionality that has a greater value proposition — or more compelling, intuitive features — than its growing list of competitors.