VocalIQ specialises in making machines more capable of understanding normal speech and working out what it is that the user is actually asking for. This is something that is very important in the overall user experience, but is only one factor in how Google scores much better than its rivals in this area.
When Google Now is tested against Siri, Cortana and Alexa (Amazon) it consistently outperforms all of its rivals by a wide margin. This is true for both its ability to understand natural speech and its ability to return the correct and most relevant answer to an inquiry or request. This is an area in which Apple has struggled for some time and it is hoping that the inclusion of VocalIQ across all of its products will move it closer into contention.
The Apple Car aficionados are viewing VocalIQs partnership with General Motors announced in 2014 as another sign of Apples entrance into the car market but I think that this is a coincidence. In fact, I would not be surprised if this acquisition spells the end of this partnership as the automotive industry is worried that Apple and Google intend to turn them into commodity hardware makers.
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This acquisition will certainly help but artificial intelligence has to be able to return the right answer and fulfil the request in a way that is relevant, easy and delightful for the user. This requires machine learning, and it is here where Google really makes its strength felt.
I have long believed that Googles machine learning is far better than anyone elses which, combined with its best in class search and reference, is really what sets Google Now apart from its competitors. Hence, this acquisition moves Apple along the road in terms of improving Siri and putting it into all of its devices but there remains a very long way to go before Siri can catch Google Now.
Google remains the leader in this field and I see nothing in the medium term that comes close to challenging that position. However, our research indicates that Googles grip on Android may be beginning to weaken, threatening its ability to continue growing Android revenues in the medium term. This combined with its fair valuation in the market continues to leave me preferring Microsoft of which very little is expected.
Richard Windsor is an analyst at Edison Investment Research.
