Will Facebook Portal Dethrone Amazon’s Echo Sooner Than You Think?

The Portal and larger Portal+ both address privacy concerns with a physical cover for their camera

By Brad Moon, InvestorPlace Contributor

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Source: Facebook

While many people were off celebrating Columbus Day, Facebook (NASDAQ:FB) quietly launched the new Portal. Technically, it is a smart speaker, but FB’s first entry into hardware is all about video chatting. The question is, do consumers trust Facebook enough to let the company put a motion-tracking camera and microphone in their homes? And will they pay anywhere from $199 to $349 (depending on whether they choose the Facebook Portal or the larger Portal+) for the privilege?

FB Announces the FaceBook Portal

Facebook had been rumored to be on the verge of releasing a video-calling smart speaker in the spring. However, after the Cambridge Analytica scandal knocked 17% off Facebook stock in two weeks, the company decided to shelve it’s first foray into hardware. 

While consumer trust in Facebook and privacy probably hasn’t increased any since then, the company would also like to take advantage of an expected rush to buy smart speakers as gifts this holiday shopping season. So it has finally, officially announced the Facebook Portal, but it did so on Columbus Day, which seems like an attempt to avoid critical headlines as much as possible.

Portal and Portal+

Facebook Portal isn’t so much a smart speaker as it is a video chatting appliance. It can stream music from Spotify’s platform (NYSE:SPOT) or Pandora (NYSE:P) and it even has Amazon (NASDAQ:AMZN) Alexa support. It can stream video from Facebook Watch and play your Facebook photos on a slideshow, but there’s no web browser, no support for Facebook messages or Instagram — video chat is clearly its primary application.

There are two sizes available. The entry level Portal ($199) looks very similar to the Amazon Echo Show, with a 10-inch, 720p display and stereo speakers. Move up to the $349 Facebook Portal+ and you get a 15.6-inch, 1080p display that can be rotated, with a subwoofer and an unusual vertical form factor.

A Facebook Portal can call another Portal, or anyone with Facebook or Facebook Messenger. It’s equipped with voice enhancing microphones, but a key distinction over competitors like Amazon’s Echo Show, is its smart camera system. FB says the Portal’s camera is always scanning the room. As more people enter into a video chat, it automatically adjusts to a wider angle so they all fit in the view. If there’s a single person on the video chat, the camera will automatically zoom in on their face. The idea is to make video chatting feel more natural, with no worries about adjusting position as people come and go.

Facebook also spikes out several key points to address the elephant in the room: security.

Here’s what FB has to say on the matter.

  • You can completely disable the camera and microphone with a single tap, or block the camera lens with the camera cover provided
  • For added security, Smart Camera uses AI technology that runs locally on Portal, not on Facebook servers. Portal’s camera does not use facial recognition and does not identify who you are
  • Facebook doesn’t listen to, view or keep the contents of your Portal video calls. Your Portal conversations stay between you and the people you’re calling
  • Like other voice-enabled devices, Portal only sends voice commands to Facebook servers after you say, “Hey Portal.” You can delete Portal’s voice history in your Facebook Activity Log

The company is trying to reassure consumers that the Facebook Portal is no different than any other smart speaker — that they have been happily buying by the millions — in the key respect that a specific voice command is needed to activate its functions. And unlike the Amazon Echo Show video smart speaker, the FB version has a physical cover for its camera. So even if you don’t trust the software, you can be assured that camera is not recording you.  

When?

The announcement was on Oct. 9 and the Facebook portal is now available for pre-order (shipping in November). Like Amazon, Facebook is offering discounts for buying two. To help nudge worried consumers, FB is offering a 30-day return, so the Portal can be shipped back if it doesn’t meet expectations. With smart speakers expected to be a big hit again this holiday shopping season, Facebook and its investors are obviously hoping that few buyers take advantage of that offer.

As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.


Article printed from InvestorPlace Media, https://investorplace.com/2018/10/will-facebook-portal-dethrone-amazons-echo-sooner-than-you-think/.

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