Google's Allo touts smarter messaging, but at a price

With Google's Allo, the tech giant is hoping you'll choose messaging smarts over privacy. Also in Searchlight: Yahoo confirms colossal breach; Oracle beefs up cloud offerings.

Say hello to Allo, Google's new messaging app that hopes to compete with the likes of Facebook Messenger, WhatsApp...

and iMessage.

No really, say hello, and it will not only answer back but also keep the conversation going possibly better than any other bot out there. What it won't do is guard your privacy (more on that later).

A signature feature of Google's Allo is the baked-in artificial intelligence that takes advantage of Google's latest Assistant technology and makes it possible to use the bot to find and share information and perform a multitude of tasks within the app. Allo's Assistant integration also allows for "smart replies" based on your conversations or photos.

"People think messaging is a solved problem, but we don't see it that way," bragged Nick Fox, Google’s VP of communications products, to TechCrunch. "We actually think we are on the cusp of a new generation of messaging apps. We think of it as smart messaging."

Alan Lepofsky, vice president and principal analyst at Constellation Research Inc., didn't disagree.

"The big trends for messaging include integrations -- bringing content into the stream from other applications such as maps, files, note taking," with those integrations extending to AI bots that respond to commands, provide additional content or take actions automatically, Lepofsky said.

Facebook's Messenger app, for example, rolled out chatbots integration earlier this year and recently unveiled a new "chat assist" feature for payments that uses machine learning to scan conversations looking for indicators that money is owed and gives users the option of paying right in the app.

Gartner analyst Werner Goertz expects Google's upcoming hardware announcements on Oct. 4th will provide an even more tightly controlled integration and further rollout of Google Assistant -- what he tags as the real star power of Allo.

But extra smarts don't necessarily guarantee success in Allo's case. In this emerging space of next-gen messaging apps, the challenge for Google's Allo -- and its companion video messaging app Duo -- is not necessarily features, it's attracting a customer base, said Forrester Research analyst Michael Facemire.

"[Allo's] success will depend on the ecosystem," Facemire said. "As the latest entry to this space, they’ll have to hope that people find more value in their intelligent integrations, or that the Google Assistant makes the overall experience better. Otherwise there aren't enough people that aren't already using a messaging client that will now start with Allo to make it a viable long-term play."

Data and privacy: The sliding scale

So will Allo go quietly into this good night? Not if its rollout is any indication. It's not often that a commercial software release comes with a warning from Edward Snowden not to use it. The whistleblower sent a series of tweets shortly after Allo's release condemning its lack of privacy and labeling it as unsafe, sparking an international debate about messaging privacy.

Chats on Google's Allo are not end-to-end encrypted by default, which could open up conversations to hackers and the federal government. Encryption is available to users, but they have to manually switch their settings to "Incognito mode," which also inhibits Assistant's abilities. Second, it was discovered that Google walked back previous claims that messages would be stored "transiently" on its servers and then automatically deleted after a certain amount of time. Instead, data from Allo is stored indefinitely.

"The key requirement for AI to provide assistance is data," said Lepofsky. "The more the system knows about you, the better suggestions it can provide." For the personal Google Assistant integration to perform effectively, Google needs access to as much of your data as possible. The bigger the data, the better the bot brain.

The key requirement for AI to provide assistance is data. The more the system knows about you, the better suggestions it can provide.
Alan Lepofskyvice president and principal analyst, Constellation Research Inc.

So the familiar trade-off between privacy and convenience comes to light again in Allo. Mr. Snowden's concerns notwithstanding, the question is -- is the privacy issue even a question anymore for users?

The data trail left by users, not only through mobile devices but also through IoT and wearables, is an irreversible effect of the digital era, said Gartner's Goertz.

"The significance of Allo goes beyond a messaging app," Goertz said. "Seen in the context of the entire user experience -- and being able to monetize digital business opportunities -- the anonymous and disaggregated gathering of user interactions, in the long run, benefits businesses as well as end customers alike."

Following the data trail is how many businesses will make money in years to come and that, he added, should be seen by CIOs as an opportunity. Information technology experts have the chance to shape the privacy question and answer it, Goertz said.

"In order to make meaningful, monetizeable impact of this phenomenon, industry and regulatory forces need to create governance frameworks," he said. "CIOs are called upon to create consensus for interoperability, security and ownership. Embrace it, don't fight it."

CIO news roundup for week of Sept. 19

The release of Google's Allo wasn't the only big story this week. Here's what else grabbed headlines:

  • 500 million Yahoo accounts hacked. The California-based Internet firm confirmed Thursday that half a billion of its users' account information was stolen in a hack that took place in 2014. The company believes a "state-sponsored actor" was behind the attack, according to a press release. The breach revealed user information including names, email addresses, telephone numbers, date of births, encrypted passwords and security questions. Unprotected passwords, payment card data, or bank account information were not compromised in the breach, the company believes. News of the breach was rumored in August when Yahoo said it was investigating a claim by a hacker named "Peace" who said he had access to 200 million Yahoo user accounts and was selling them on the dark web. It's yet to be seen how this incident will affect the company's deal with Verizon, which agreed to buy Yahoo for almost $5 billion in July.
  • Ellison puts a target on AWS. The California-based tech giant is redesigning its cloud infrastructure and will take on Amazon's cloud, Oracle CTO Larry Ellison said during his keynote at the OpenWorld conference in San Francisco on Monday. In addition to beefing up its existing cloud services, Oracle introduced a lineup of infrastructure as a service offerings -- Oracle Bare Metal Cloud Services, Oracle Ravello Cloud Service, Oracle Container Cloud Service – in an aim to offer  enterprise customers the benefits of both multi and single-tenant environments, according to a press release. "The latest additions … enable organizations to seamlessly connect their existing resources to the Oracle Cloud using Virtual Cloud Network and select from a wide variety of compute services including bare metal, virtual machines and engineered systems as if it were a part of their own datacenter," Thomas Kurian, president of product development at Oracle, touted.
  • The future of Lyft. In five years' time the majority of Lyft rides will be provided by a fleet of driverless cars said John Zimmer, co-founder and president of the San Francisco-based transportation network company, in a blog post this week "And when networked autonomous vehicles come onto the scene, below the cost of car ownership, most city-dwellers will stop using a personal car altogether," he wrote. That in turn will change the face of urban areas, he predicted, with spaces currently used for parking opened up for other uses. Prior to operating a fully autonomous fleet, Lyft will operate a "hybrid network", where both driver and driverless cars will be used, Zimmer said. In other autonomous vehicle news, the White house released guidelines for self-driving cars on U.S. roads Tuesday.

Check out our previous Searchlight roundups on Uber's self-driving car event and whether CIOs should care about the iPhone 7.

 Assistant editor Mekhala Roy contributed to this week's news roundup.

Next Steps

Google's messaging strategy splits Hangouts, communication apps

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What would you rather? Privacy or a smart personal assistant?
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How much people use a messaging app,  or any other kind of social app,  is predicated not on its features nor its security,  but on how many of their friends are using it.  If Allo can't get an installed base,  it doesn't matter how good or bad it is.  
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I agree 100℅ with Sharon. Unlike SMS and email, messaging apps tend to be vendor specific and users cannot send messages to another client. So until message gateways are introduced it's hard to see how a new entry will get market share. I have Allo installed but no one to chat with :( whereas I use WhatsApp for all my family (except my Mother who has an iPad ... which can't run WhatsApp!) I Slack with developers and email (still) for everyone else. All creating an increasingly fragmented world. .  
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