Alphabet Inc Moves To The Next Level…
Alphabet Inc (NASDAQ:GOOGL) hit the headlines when GOOGL stock touched its 52-week high of $819.06. The company, otherwise known as Google, also rebranded its cloud business as “Google Cloud” and its “Google Apps” as “G Suite” to celebrate one billion active cloud users.
With the Internet full of leaked pictures of Google’s upcoming “Pixel” smartphone, expectations are high for the company’s October 4 event. However, Alphabet Inc is targeting something bigger through this event, which would determine whether Google stock can cross its high level and go on to make new highs.
Google is expected to unveil its “Google Home” device tomorrow. It is a small speaker with microphones that respond to voice commands and carry out tasks like playing favorite music or working with Google services.
Google Home is powered by “Google Assistant,” Google’s smart digital assistant which uses artificial intelligence (AI) to understand queries and come up with the most accurate responses. Management has tried to build this capability into its messaging app “Google Allo” and into Alphabet Inc’s upcoming smartphones and tablets. (Source: “Google, Lagging Amazon, Races Across the Threshold Into The Home,” The New York Times, October 2, 2016.)
Google has been trying for a long time to create a virtual assistant that would respond to searches and commands with greater precision. Google Assistant becomes more and more intelligent as it gets to know the user better.
This is not only to compete with Amazon.com, Inc’s (NASDAQ:AMZN) “Amazon Echo” that is powered by “Alexa.” It is also about Google’s plan to get its AI feature into customers’ daily lives. The more the company gets involved in people’s lives, the bigger potential it has for its advertising business, which means bigger gains for Google stock.
As the dominant search engine, this is something that was the next natural step for Google. Instead of having to type questions into an Internet search field, users will be able to simply speak to Google Assistant, which uses AI to generate answers. The potential for this capability is huge. And the biggest gains are likely to go to GOOGL stock.
Moreover. Google is the leader in natural language processing, which means the company’s technological ability to turn spoken words into something that computers can easily understand is unparalleled. That cannot be said about Amazon.com or Apple Inc. (NASDAQ:AAPL).
As the company moves from offering a traditional search bar to building an all-pervasive and all-knowing smart digital assistant, current and potential Google stock investors should be looking at the features and pricing of the new Google Home device. If Alphabet Inc can come up with a smarter digital assistant with superior search capability, at a competitive price, the company will have a winner in its hand. This would likely give a huge boost to GOOGL stock.