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Amazon’s Alexa could in your next apartment whether you like it or not

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Just as many other modern homes in the U.S., the apartments at the Brandon Place complex in Oklahoma City are highly automated. There are smart locks on doors and thermostats with touch-screens, and new tenants will be informed in the move-in briefing that these smart systems can be operated through Amazon’s Alexa-powered devices.

These ‘Alexa-ready’ homes are the result of Amazon’s well thought commercial strategy: bypassing consumers’ choices, and getting into millions of homes by dealing directly with builders, property managers, and hoteliers. Amazon even set up a little known team, part of the Alexa division, called Alexa Smart Properties, to take care of this lucrative business branch, according to a feature in the Wall Street Journal.

For the tenants, having an Alexa-integrated home means they could get tech-amenities that they could have trouble installing alone. It could also facilitate the installation of other Alexa controlled devices. However, tenants are not really given the choice of smart-home gadgets and it could be hard or even impossible to switch to Google, Nest and Apple products.

And privacy is the biggest concern, of course. Increasing technology nowadays goes hand in hand with surrendering more data to whichever party is monitoring the interactions with the smart-homes.

Last November Amazon announced its partnership with Zego, now a Paylease subsidiary. Zego has created a home-system where each apartment gets its smart-devices and a hub that connects to the internet.

Tenants then receive an Amazon Echo speaker (if they haven’t got one already) that they can use to control the locks, the thermostat, and other Alexa-ready smart devices. Zego also offers a downloadable app that can be used to request repairs and even pay the rent – capabilities that could soon be extended to the Echo speakers.

PayLease Chief Executive Dirk Wakeham said that his company envisions “a day when you can say ‘Hey Alexa, pay my rent,’ and it will transfer that money from a resident’s bank account”. He added that his company plans to distribute its Alexa-compatible smart-home system to more than six million apartments in the U.S. within five years.

Predictably, Zego will collect data specific to each hub and connected devices – including locks and thermostats- to use it for creating models of the tenant’s experience. “We can predict if residents are happy based on their digital interactions with the service, which gives us more information about whether they will renew their leases,” said Zego CEO Adam Blake.

Information collected will include the sentiments of the tenants during app-talks with managers, how many and which devices are connected in their apartment, and if they are good payers.

Home automation can also reduce expenses for property managers. Simplifying the access to contractor procedures, changing the door locks and controlling temperatures in vacant homes can save some money, said Nick Stefanov – an apartment complex owner with properties in Arkansas, Louisiana, Oklahoma and Texas.

Stefanov’s company installed the Zego system in 225 homes since January.

Alexa-operated smart homes might even in time replace rental agencies. The initial data gathered from trials show that people are twice as likely to rent a property when there is no ‘middle man’ to try and push the sale on them, explained Mr. Wakeham.

The Zego deal might be the biggest effort Amazon has made so far in this direction, but it will not be the last. The US largest homebuilder by revenue, Lennar Corp., started to offer Amazon’s smart-speakers to an unspecified portion of the 35,000 new homes constructed in 23 states last year, and the company will continue to offer Alexa smart-speakers in 2019 and beyond.

Selling smart-home devices is a fast-growing market. According to IDC, shipments of devices will increase by 27% in 2019 compared to the previous year. Previsions calculate more than 350 million devices – excluding smart TVs – will be shipped this year. 25% of American adults own a smarts-speaker. Amazon is estimated to hold a share of two-thirds of all smart-speakers in use, while Google barely a quarter and Apple a four percent.

Amazon’s mentions that the company also aims to push Alexa and the Echo speakers in stadiums and hospitals. Senior-living communities and vocation-rentals operators are also in the company’s crosshair, and to be able to close the deals Amazon is willing to share insights, revenues, and even our well-valued private data.

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