[DECODE] Is the Djingo connected speaker from Orange coming too late?

by bold-lichterman

Two and a half years after being announced at Orange’s annual “Show Hello” conference in April 2017, and supposed to compete with the Amazon Echo and Google Home, Djingo, the connected speaker from Orange, s ‘finally getting ready to fill the shelves of the brand’s shops. The exit of Djingo suffered some setbacks, illustrating the difficulties encountered by Orange in the implementation of its innovation strategy.

In 2017, Orange unveils Djingo with great fanfare

When Stéphane Richard, Chairman and CEO of Orange, unveils the Djingo speaker for the first time in spring 2017 at Salle Pleyel, Orange, which has just announced 40.9 billion euros in sales in 2016, wants to position itself on voice interfaces quickly, in competition with GAFA.

We think we can move towards an augmented planet, an improved self ”, assured Stéphane Richard.

In addition to its brand new Orange Bank neobank, internet box ” smarter “ and new features in line with its smart home ambitions, the incumbent operator presents a new connected speaker “which allows interaction with all the content and services of the Orange ecosystem ”. Compatible with most operating systems, the device will be able to answer questions asked by users in their daily lives to control their home automation as well as to access services through a revolutionary voice interface.

The group has partnered with German operator Deutsche Telekom to develop a voice assistant. The German version will be called Magenta (color registered by the German operator).

The two players are joining their resources, in particular R&D, to develop the artificial intelligence of Djingo, a name that simultaneously defines the speaker and the virtual assistant. On paper, an industrial partnership between two key players in Europe, a model of a competing offer that has to face GAFA.

The Djingo enclosure. Credit: Orange.

Djingo, a project more complicated than expected

At this time, the Amazon Echo and Google Home were already starting to find their place in the homes of consumers. Taking a stand is a key step before moving on to conquer uses. But at the launch date, no sign of the device in Orange stores, nor Magenta at Deutsche Telekom. During a highly anticipated Hello Show, in December 2018, to face Xavier Niel and his new supercharged box, Stéphane Richard promises the availability of Djingo before spring 2019, from 49 euros for all Orange customers.

Djingo is currently in the test phase with 5,000 people. Once this test period is over, this technology will be marketed from the end of February 2019 ″, assures Mr. Richard.

Faced with questions from journalists, Stéphane Richard specifies that the device will make it possible to search for films, make calls and have access to Orange smart home services. We will also learn that the French telecom has joined forces with… Amazon, whose strategy is not limited to creating a multitude of devices equipped with Alexa, but to embed its voice interface technology wherever it can. Good players at Orange, Djingo will therefore also work with Alexa, difficult to criticize this interoperability.

Unfortunately, in the spring of 2019, still nothing. The release is again delayed for two months. Orange and Deutsche Telekom no longer dare to bring forward any release date for Djingo or Magenta.

At the beginning of September, Magenta, the connected speaker from Deutsche Telekom operating on the same base, is finally launched.

On the Orange side, it is not the same story, while the historical operator is preparing to launch a new box, Fabienne Dulac, its General Manager announces that Djingo must be marketed ” fast enough “. The project turned out to be ” more complicated than what had been anticipated “, she concedes.

Behind these delays: technical difficulties. The development teams of the Technology and Global Innovation (TGI) division, responsible in particular for Djingo, would encounter problems in the interconnection of smart home features, but also in the implementation of the multilingual voice recognition system. Orange points to a long and complex learning period.

Orange’s transformation agenda is confusing

These technical difficulties would have been partly caused by a lack of visibility in the group’s transformation program initiated in 2018 by the executive committee and launched in early 2019. The program, called the “Vanilla project”, comes in particular following the “Nova +” program. ”, Started in 2011 with the aim of transforming innovation within the group by solving three problems: insufficient consideration of local international needs, lack of user tests, and too complex and hierarchical organization.

The Vanille project saw the creation, in the first half of the year, of groups of project managers linked to innovation with the aim of continuing the group’s dynamic of development and transformation. The program was built around three principles: the involvement of all members of the executive committee; listening to employees, in particular through 150 individual interviews; co-construction via the organization of six workshops aimed at fueling the debate of the executive committee. Each member of the executive committee thus took charge of one of the ten priority projects finally established.

One of these projects, called “Group innovation more country and regional oriented and focused on the group’s priorities”, was awarded to Mari-Noëlle Jégo-Laveissière, director in charge of technologies and global innovation. at Orange since 2014. Except that monopolized by the Vanilla project, Mari-Noëlle Jégo-Laveissière would have abandoned Djingo and the TGI division teams would suffer from a lack of resources.

In a document published in September, the CFE-CGC Orange union severely criticized the results of this policy. Thus, innovation at Orange, “ a true marker of the group in its time, (…) now suffers from the organizations put in place ”. He adds that “the Orange Block and HomeLive are business failures. The end of the Orange Cloud, without a fallback solution, also tarnishes the company’s image with its customers. Expected since 2017, Djingo is still not marketed and the new box is announced for the end of 2019, very late compared to its competitors ”.

It is clear that a good number of reorganizations sow more confusion than they simplify operating methods ”, added CFE-CGC Orange.

Meanwhile, Amazon, Google and BATX have over-invested the market

Today, one in ten French Internet users uses a connected speaker such as Amazon Echo or Google Home. A much less developed use than in the United States, where nearly one in four people use this type of device, or in other European countries, but expected to conquer a third of households in the medium term, according to a study of CSA and Hadopi presented earlier this year. Nearly half (46%) of Internet users have already used a voice assistant (Siri type, OK Google, etc.). Although uses are still relatively basic (asking for the weather forecast for 78% of users, searching for information on the Internet for 75%), cultural and media practices are widespread, especially listening to music (89% of users) or radio (81%).

Home automation uses (controlling household appliances, switches, etc.) are still less widespread and concern 36% of connected speaker users. The object is still considered a gadget by a quarter of users. Today, only 4% of non-equipped Internet users intend to buy such a device in 2019, considering that it still offers too few services and for fear of personal data. A little less than a third of French people, or 20 million people, occasionally or regularly use a voice assistant in 2019. Most of the uses remained linked to voice assistants on smartphones.

Credit: Canalys.

This development poses a strategic question for French companies, while voice assistants remain for the moment the prerogative of large American and Chinese groups.

In the United States, the world’s largest market ahead of China and the United Kingdom, Amazon holds 70% of the smart speaker market, while Google occupies nearly 25% of the market, with around 5% going to Apple, according to figures from Consumer Intelligence Research Partners (CIRP). It was the best-selling consumer electronics product in 2018, according to Strategy Analytics. Better yet, sales grew 95% to 38.5 million units in the fourth quarter alone, during periods of end of year celebrations, more than the whole of 2017. In total, 86.2 million connected speakers were sold worldwide in 2018 and 60 million households now have at least one device of this type.

A Djingo speaker that arrives too late?

Djingo will therefore be launched as a soft launch on Wednesday November 13 online, and the next day in 80 Orange stores, before accelerating its distribution in 2020.

A commercial delay, which should be reinforced by a delay in product and use. The giants of the sector, which occupy almost all of the market share, have acquired a strong knowledge of consumer practices and are already targeting outside the home: during its hardware event in September, Amazon announced an avalanche of new connected products. , intended to further flood the market.

Djingo is a perfect illustration of the incumbent operator’s difficulties in addressing major innovation topics, while pointing out the internal inertias responsible for such delays. A real snub for Stéphane Richard who, in addition to the delay, which has been echoed in the press for three years, will have to face the probable failure of a project that he saw as a flagship of his innovation strategy. What will be the consequences on the organization and management of Orange? The future will specify the speed with which the lessons will be drawn from it.