Alibaba to invest $1B on AI integration with smart speaker

Chinese e-commerce giant will use the funds to bolster its artificial intelligence and Internet of Things ecosystem that supports Tmall Genie, including linking more content and services from Alibaba's wider ecosystem that spans entertainment, healthcare, and education.

Alibaba plans to invest 10 billion yuan ($1.15 billion) to boost the artificial intelligence (AI) and Internet of Things (IoT) ecosystem that supports its smart speaker, Tmall Genie. Such efforts will include integrating Alipay mini-apps as well as more content and services from Alibaba's wider ecosystem that spans entertainment, healthcare, online shopping, and education. 

The Chinese e-commerce giant added that it planned to develop proprietary AI and IoT technologies to enhance natural voice and visual interactions between the smart speaker and consumers. This development work would be carried out alongside its cloud and R&D unit, Alibaba Cloud and Alibaba DAMO Academy, respectively. 

From July 1, mini-apps currently running on its mobile payment platform Alipay will be integrated with Tmall Genie, Alibaba said in a statement Wednesday, In addition, its live streaming service featuring merchants on its Taobao online marketplace can be viewed on the smart speaker's screen.

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More than 1,100 brands currently connect with Tmall Genie, as well as 270 million devices in China, providing various services to fulfil various needs in consumers' daily lives. 

Citing research firms IDC and Euromonitor, Alibaba said Tmall Genie accounted for more than 35% share of the Chinese market and led the country in terms of unit shipment. 

According to stats from Canalys, some 3.89 million units of Alibaba's smart speaker were shipped in the third quarter of 2019, up 77.6% from the year before. That accounted for a 13.6% global market share. Genie is available only in China. 

Alibaba said its latest investment would lead to more AI and IoT technologies developed internally, including its IoT operating system, edge computing, as well as visual and voice AI software such as its Natural Language Processing technology. 

"Tmall Genie will also share its latest AI and IoT technologies, vertical market insights, product design skillsets, abundant content, and service capabilities with partners to co-develop intelligent products, such as refrigerators, robot vacuums, and smart sportswear," it added.

Head of development at Tmall Genie, Wei Ku, said the goal was to deliver richer user experience through the smart speaker. "We are also partnering with brands to offer our AI and IoT technology, design ideas, and go-to-market advice, so they can be empowered to explore opportunities in the AI and IoT era, and more smart products can be rolled out to the market to enlighten consumers' daily life, too," Wei said. 

One merchant, fast food chain KFC, recently partnered with Tmall Genie to enable consumers to order items from the restaurant's breakfast menu by viewing and selecting their choices on the screen. Orders can be completed through a voice payment feature and picked up from a network of 5,000 KFC stores across China. This ordering service will launch in the second half of 2020.

In a separate announcement Wednesday, Alibaba said service providers in China had developed more than 800 mini-programs for Alipay in the past two months, each of which shored up more than 10,000 monthly active users. 

Such efforts have been fuelled by Alibaba's three-year plan, announced in March 2020, to bring 40 million service providers across China onto the mobile payment platform and expand the types of services available to consumers. The move aims to open up the platform, enabling these providers to develop and offer a range of lifestyle apps for food delivery, hotel booking, transport, and medical services. 

Alipay currently serves more than 1.2 billion users worldwide through its global partners, according to Alibaba.