Chinese tech giant Baidu unveiled its first commercial AI offering this week named Xiaoyu, or ‘small fish’ in English. The voice controlled home robot uses the company’s operating system DuerOS and is marketing as a device to help busy parents take care of their children. The robot has similar talents to that of Alexa in addition to video chat and streaming capabilities. Parents can remotely control the robot and use the camera to see what is happening inside their home. Xiaoyu can also act a tutor, teaching English and other languages to the children in its care, an important feature to urban Chinese parents. “Home is an important field for Baidu to put artificial intelligence technology in people’s everyday life,” said Baidu Chief operating officer Lu Qi.
Baidu Needs Xiaoyu to Be a Success
While Xiaoyu is being billed first as family friendly device, the company believes the robot has greater potential to be scaled globally. And Baidu needs it to be a success. Stricter government regulations on advertising have hurt the company’s paid search business leading to stagnate growth in 2016. Baidu has made several key moves to shift the company’s strategy to one focused on AI in the past year, including the purchase of AI start up Raven Tech in February. The AI home assistant market could be a lucrative one for Baidu especially considering the size of the Chinese market which has over 700 million internet users alone.
Competing for Dominance in the Chinese Market
This large internet base makes the Chinese market a lucrative one for AI virtual assistants. And Baidu wants to stake its claim first to establish dominance. First mover advantage will be important in this market, especially considering that similar devices like the Amazon Echo and Google Home are not available in China today. In fact, Alexa and Google Assistant can’t even speak Chinese. Even Apple’s Siri who can speak the native language is not an imminent threat as the company has yet to launch a smart speaker of its own. This strong lead could make Baidu a major player in the AI assistant market in China, making it difficult for others to claim market share. Amazon Echo’s early success suggests that being first to market is a key advantage in the smart speaker wars. If Baidu’s Xiaoyu is a hit, Amazon, Google, Apple and others could be left out in the cold.