The “smart home” concept has long been core to utopian dreams of a digital future. While the first half of the twentieth century saw rapid advancement in the automation of specific household tasks, the post-war period abounded with visions of fully connected, AI-supported living spaces. From Monsanto’s 1957 “house of the future” – produced in collaboration with Disney and MIT – to Microsoft’s 1999 “smart home” concept, there were a great many attempts to imagine what digital technologies might do to our most private spaces.
In 2000, a team at Georgia Tech university launched a research project called the Aware Home. The researchers imagined the home of the future as a kind of “human-home symbiosis” in which a network of sensors would interact with wearable devices utilised by the occupants. The project’s goal was to help develop the technologies needed to, in the researchers’ words, “create a home environment that can both perceive and assist its occupants.”
Two decades later, and the ideas behind the Aware Home have left the space of academic research to become part of everyday life. As of 2019, an estimated 69% of US households had at least one smart device. The technological infrastructure for highly automated smart homes is now largely in place across many parts of the world. As with many other forms of digital transformation, the COVID-19 pandemic has served to accelerate adoption.
But however much the Aware Home resembles an early prototype of the contemporary smart home, there was one fundamental difference. The researchers at Georgia Tech designed the Aware Home so that the inhabitants would wholly own and control the data it generated. Moreover, all the data would be stored and processed on-site in order to maximise security and trust. They considered that any other approach would violate fundamental, long-standing principles of what a home is – that is, a private and inviolable space of retreat. For the researchers, this was an ethical boundary that should not be crossed.
As Shoshana Zuboff notes in her highly influential 2019 book, The Age of Surveillance Capitalism, the smart home that has taken shape over the past decade could not be further from this model. Indeed, its fundamental principles are entirely opposite to those adopted by the Georgia Tech researchers. As we’ll see below, the smart home has instead emerged as a potent means of data extraction smuggled into our most intimate spaces under the cover of convenience.
In this post, we’ll examine how the utopian image underpinning the Aware Home was replaced by a far darker and more troubling reality, in which the most private living spaces of millions of people were reimagined as untapped data sources. We’ll look at how this shift was neither incidental nor accidental but rather part of the core business strategy of some of the largest corporations in history. Finally, we’ll ask whether an alternative can be imagined, in which we reap the benefits of smart home devices without consenting to give up our privacy.
The widespread adoption of smart home tech through Amazon’s Echo
If a major turning point can be identified in the widespread adoption of smart home tech, the launch of Amazon’s Echo smart speaker in late 2014 is a strong contender. The device utilised a voice-controlled virtual assistant named Alexa to allow users to perform various tasks, from playing music to setting alarms, making to-do lists, and checking the weather. Importantly, it also functioned as a hub device from which the user could control a range of other smart devices – and not just those developed by Amazon.
As with its market-leading cloud computing service AWS, Amazon’s strategy was bold and effective: become the first company to offer a practical and affordable option within the market, leverage its other services to maximise the rate of adoption, and trust that the barriers to switching to a competitor’s services would be too high for most. From this standpoint, the Echo was far more than just a smart speaker – it was the opening volley in a battle for smart home supremacy. It was also a kind of AI-driven Trojan horse, allowing Amazon to inveigle their way into its customers’ most private spaces.
And just as with AWS, Amazon’s land-grab in the smart home space has thus far proven extremely successful. As of August 2021, Amazon’s Echo devices made up 70% of the US smart speaker market. Even more significantly, the number of users with multiple Echo devices was relatively high, representing some 20 million US households. As a result, Amazon has established a significant foundation for future smart home development, ensuring that, in a substantial number of cases, future devices will either be Amazon-designed or will be required to interact with Amazon’s services to function. For example, Amazon’s purchase of Ring, a smart doorbell company, in 2018 is a case in point. Ring doorbells not only allow homeowners to answer their door remotely and capture audio and video recordings but also interoperate with other Alexa-enabled devices.
It may seem obvious why Amazon would want to corner this growing market. After all, the smart home market is significant and growing rapidly, and if they have control of this market, it could lead to substantial revenue generation in the future. However, this explanation misunderstands the nature of Amazon as a company and the source of its success – a misunderstanding that, as we’ll see, has often served to obscure the company’s true motives. And in fact, Amazon’s goals with their smart home offerings have clearly not been, thus far, focused on revenue.
Compared to its other services and product offerings, Amazon’s smart devices contribute very little to Amazon’s bottom line. Indeed, there have been numerous claims that it has sold its Echo devices at a below cost price in recent years. This may well change in future, but Amazon has other priorities. And it is only by understanding these priorities that we can truly see the value of the smart home market for Amazon and its competitors.
Amazon is essentially a data company
For most people, Amazon is synonymous with online shopping. The Amazon web store is far and away the largest online retailer globally, with an unrivalled range of products on offer. In the US, Amazon holds a 41.4% share of the e-commerce market; Walmart, in second place, can boast only 7.2%. Nevertheless, while Amazon’s online store is its main source of revenue, it is not its most profitable venture. In 2020, Amazon’s web services (AWS) contributed 63% of Amazon’s total operating profit. And its control over the cloud computing market is almost as impressive as its position in e-commerce; in 2020, it held a 40.8% market share for public infrastructure-as-a-service (Iaas) cloud spending, double that of its nearest competitor Microsoft.
Thus, it is in a certain sense more accurate to describe Amazon as a cloud computing company that also operates an online store. But for a fuller understanding of how Amazon operates – and why it has been so concerned to capture the nascent smart home market – we need to see how these two aspects of the business are, in fact, fundamentally related. That’s because Amazon is, in reality, neither a cloud computing company nor an online retailer. It is, as a former executive put it, “a data company” that “happen[s] to sell products”.
From this standpoint, virtually all of Amazon’s services can be seen in a new, highly revealing light. Amazon’s web store doesn’t just sell products – it gathers enormous quantities of data on consumer behaviour. It tracks the products you buy, and when you buy them. It tracks your behaviour on the store, from the searches you make and pages you view to the actual clicking and scrolling actions you take – as well as the device you make them on and the location where you do so. Amazon Prime’s video streaming service similarly tracks your searches, your viewing habits, and even how long you spend watching a specific film or programme. Your Kindle, meanwhile, tracks what you read and how long you spend reading it, as well as how frequently you highlight parts of books. All of this data is aggregated to produce complex, intricate and highly revealing profiles of user behaviour.
The data that Amazon’s various services collect on their users is of inestimable value to the company. By aggregating enormous quantities of data from a vast range of sources, Amazon can build up highly complex and intricate profiles of consumer behaviour and preferences. It can then use these profiles to refine and tailor its services by making ever-more-accurate predictions about how its customers will behave in the future. From targeted recommendations to predictive inventory management, Amazon’s competitive advantage across various sectors is rooted in its widespread and invasive data collection practices.
Amazon is, of course, not alone in this. This data-centred model characterises the fundamental trajectory of the web over the past twenty years. It is precisely this emphasis on extracting user data to predict – and ultimately shape – behaviour that constitutes what Shoshana Zuboff defined as “surveillance capitalism”. In the age of surveillance capitalism, the company with the most accurate predictions about user behaviour is likely to come out on top. For this reason, Google, Facebook, and Amazon, among others, have dedicated their substantial finances and technological capacities to building the most refined and furthest reaching data-gathering platforms possible.
And this ultimately explains why the premises underpinning the Aware Home were so easily discarded. Suppose data is crucial for the tech giants to stay ahead of their competitors. In that case, the idea of respecting the boundaries of a user’s most private space is, simply put, economic suicide. Instead, the goal is to get access to this largely untapped domain of user data more quickly and effectively than anyone else – even if this means, for instance, selling your smart devices at a loss.
Amazon’s surveillance capitalism: Alexa recording and storing your every command
In December 2018, a German man took advantage of the EU’s (relatively) strict data protection regulations to request a copy of the data Amazon had collected about him. Amazon sent him a link allowing him to review an enormous quantity of data – including a complete history of searches he had made on the Amazon store and an astonishing 1700 voice recordings made by an Echo device. This last point was surprising – he had never owned an Echo nor used an Alexa-enabled device.
He quickly realised that he had, in fact, been sent extensive and sometimes profoundly intimate recordings of a complete stranger. These recordings included questions about the weather, music commands, and even what an NPR report describes as “comments related to work and living habits.” He tried to report the issue to Amazon but received no response. Finally, he went to a German trade magazine, which quickly tracked down the person in the recordings using just the information that could be gleaned from them.
Of course, Amazon immediately took steps to reassure Echo users that this was an “isolated incident” resulting from “human error”. They chose, however, not to comment on the underlying implication – that Alexa routinely recorded and stored users’ voice commands. This fact would re-emerge in the middle of the following year in a string of attention-grabbing headlines in major newspapers: “Amazon’s Alexa never stops listening to you,” announced the New York Times, while the Washington Post informed its readers that “Alexa has been eavesdropping on you this whole time.” Most startling of all, Bloomberg clarified that not only was Alexa continually recording users’ interactions but that “Amazon workers are listening to what you tell Alexa.”
What is most remarkable about these headlines is the lack of understanding they imply about the technologies we are increasingly admitting into our homes. It was, in fact, never a secret that Alexa-enabled devices recorded users’ voice commands – indeed, this was not even an incidental feature but fundamental to how the devices operate. But, as we’ll see, it was also essential to their function as the latest front in the battle for data supremacy.
As Amazon itself acknowledges, though somewhat reluctantly, Alexa-enabled devices making an audio recording of your requests are a feature, not a bug. Alexa-enabled devices record your instructions and send them to the cloud for analysis to process requests. Specific words are identified and translated into instructions, to which the device can then respond. This is a fact that is nevertheless easy to forget under the façade of immediacy and responsiveness Alexa is intended to have – including, for instance, by laughing on command. Most importantly, it is something that, as the furore of 2019 demonstrated, most users had simply never considered in the first place.
However, as you may expect, given the above discussion of surveillance capitalism, the use of audio recordings by Alexa goes far beyond simply responding to individual requests or commands. If you consult Amazon’s terms of service, you will also be informed that the recordings are also used to “improve your experience and [Amazon’s] services.” To this end, all recordings are stored permanently by default and used to provide a “more personalised experience” by integrating with other data Amazon have collected about you – which, as we’ve discussed above, is likely a great deal.
Amazon was understandably disinclined to emphasise this aspect of its Echo devices – hence the widespread shock when several news stories through 2018 and 2019 drew attention to this fact. However, such shock is indicative of an overall naivety about how Amazon operates. As we’ll see, such data collection practices sit at the core of Amazon’s highly lucrative business model – a model, moreover, that has shaped the growth of the web over the past two decades.
In the second part of this deep dive, we’ll delve further into how big tech companies like Amazon gather our personal data on a mass scale and the ethical issues surrounding this. We’ll discuss why access to our private spaces occasions such intense competition among some of the world’s largest and most influential companies. And finally, we’ll dive into what the future of the smart home will look like discussing the trustless alternatives of decentralised, open-source smart home tech.
Stay tuned for part two.
In case you missed it
Additionally, we are looking for data centres and cloud service providers with global locations. So we want you to contact us now! If you already have your CUDOS tokens, why not make the most of them by staking them on our platform and securing our network?
The Cudos Network is a layer 1 blockchain and layer 2 computation and oracle network designed to ensure decentralised, permissionless access to high-performance computing at scale and enables scaling of computing resources to 100,000’s of nodes. Once bridged onto Ethereum, Algorand, Polkadot, and Cosmos, Cudos will enable scalable compute and Layer 2 Oracles on all of the bridged blockchains.