Google aims to win the AI revolution by building a personal assistant into everything

Google believes we are on the cusp a shift in computing as fundamental as PC to mobile. This time, the shift is away from physical devices themselves to where the killer app is AI, or artificial intelligence, baked in.

But to get there, ironically, Google has to actually build more devices than ever before. So on Tuesday the company unveiled a raft of new devices with its brand of AI, "Google Assistant" inside: new smartphones, a connected speaker and a VR headset. While Google boasted about the hardware, Google CEO Sundar Pichai made it clear that AI is what will set it apart from competitors like Apple and Amazon.

"Computing will be universally available, it will be everywhere in the context of the user's daily life," Pichai said. "People will be able to interact with it naturally and seamlessly than ever before. And above all else, it will be intelligent."

The shift to AI, he said, is as predictable as the history of computing, which undergoes a big revolution just about every decade: from desktop PCs in the 1980s to the web revolution of the mid-1990s, and from there to mobile a decade ago.

Google sees its Assistant not as a voice-activated replacement for its search box but as part of a "two-way conversation" that will be available whenever the user needs it. "Our goal is to build a personal Google for each and every user," Pichai said.

The Pixel smartphone and Home speaker are the first devices with Google's brand of AI built in. Google claims the Pixel is the first smartphone it has ever built. But that's a bit of a stretch given Google has previously owned Motorola and has been "building" Nexus smartphones for the past seven years with hardware partners like Samsung, HTC, LG, and Huawei.

But the Pixel is the first phone to be branded "Made by Google" and is a significant shift in its smartphone strategy, which until now has been about working with hardware partners rather than competing with them.

Home, which will cost $129 ($50 less than the Alexa-powered Echo), will go on sale in November and will allow users do a lot of things they can't on Amazon's device, including accessing Google's knowledge graph, a database with over 70 billion facts on tap. While Echo has a big head start, Google's AI-powered Home has the potential to dominate if it can convince developers that it is the system they should be developing for.

"This is stuff that Google is already really good at, and a product like Home seems like a great place for the Google Assistant to shine," Jan Dawson, chief analyst with Jackdaw Research, said. "The focus here, though, should be on providing usable features everywhere, not just in Google-owned hardware."

Google says that by controlling the hardware and software, it can better deliver its vision of AI-powered computing. Controlling all aspects of the phone is a game plan straight from Apple's playbook, and one which Apple has shown to be hugely successful with its iPhone business.

The problem for Google is that it is starting from zero in a smartphone market where growth is plateauing and competition has never been tougher. Add the fact that Google is selling its new smartphones at the same price as Apple's iPhone or Samsung Galaxy S7, and it will have a big struggle on its hands to make any impact — initially at least.

"Google is still fighting an uphill battle when it comes to mainstream adoption of its hardware beyond Chromecast, and there's little here to suggest that this will change anytime soon," Dawson said.

To this end Google will open the Actions for Google SDK for developers in December and allow third-party hardware manufacturers to leverage the power of Google Assistant and let users control them using their voice, via Google Home.

Pichai indicated that just as the Google search page was people's homepage on PCs, the web and mobile, it wants Google Assistant to be always there in the next era of computing. "Our vision for the Google Assistant is to be universal, to be there everywhere the user needs it to be."