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Echo's recent eavesdropping incident could undermine Amazon and the smart speaker market as a whole

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A family in Portland, Oregon reported that their Amazon Echo Dot surreptitiously recorded their conversation and sent the audio to someone in the device’s contact list, according to local TV station KIRO7.

Though the recording and transmission apparently took place due to a series of unintentional statements that the smart speaker mistook as commands, the breach of trust and security could further undermine consumer confidence in smart speakers, and, particularly, in Amazon’s Alexa voice assistant.

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While the Portland family was having a private discussion, the Echo Dot apparently mistook a word for the device’s wake word, “Alexa,” which triggered it to start listening. The smart speaker then began listening to the conversation and interpreted a statement as “send message,” after which it began recording audio.

The device then interpreted another word following a pause as a contact’s name, and sent the recorded audio to that contact. Amazon acknowledged via statement that the company’s engineering logs confirmed the sequence of events, which it termed as unlikely.

This inadvertent eavesdropping episode could undermine consumer confidence in smart speakers.The always-listening nature of a device like the Amazon Echo is what makes it useful as a hands-free voice assistant platform. But this also means users must trust the device isn't listening when they don't want it to, or regularly monitor and observe the speaker visually, which defeats the purpose of an audio-first device.

Even before this incident, public discourse around smart speakers, and the Echo especially, had warnedabout the security and privacy implications of the devices. Increased exposure to these issues as they actually impact consumers will only reinforce the notion that these devices require trust in the tech companies that develop and maintain them.

Amazon may lose ground in the smart speaker market, thanks to the trust issues this incident will amplify.Last week, reports emerged that the e-commerce titan was working with law enforcement agencies on real-time image recognition, which prompted outcry from advocacy groups over privacy concerns. Moreover, sales of Google’s rival Home devices surpassed those of Amazon’s smart speakers for the first time in Q1 2018, according to a new report from Canalys.

Though Business Insider Intelligence expects that Amazon’s smart speakers will continue to top the market in the years ahead, companies developing and relying on these devices will need to ensure that they maintain consumer trust so the market can continue to expand.

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Newman is a Research Analyst at BI Intelligence. Previously, he was a graduate research assistant at Vanderbilt University. He received his MA in Political Science from Vanderbilt where he focused in research on political theory and empirical methodology, and holds a BA in Politics from Brandeis University.