Amazon Is Working on Smart Glasses With Alexa on Board

In this Market Foolery podcast segment, host Mac Greer and David Kretzmann and Aaron Bush of Supernova and Rule Breakers ponder what it would take to make augmented reality spectacles a winning product for (NASDAQ: AMZN) or a flop, and whether the company is in position to beat Apple or Alphabet to the magic formula.

A full transcript follows the video.

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This video was recorded on Sept. 20, 2017.

Mac Greer: Amazon working on its first wearable device, a pair of smart glasses. The device will allow the wearer to summon Alexa, Amazon's digital assistant, and you can also hear Alexa without the headphones. Now, I remember when Google Glass and Google Glasses were the thing, and then they retired them, and then they brought them back. What's Amazon doing here?

David Kretzmann: This is toward the top of my list of, OK, maybe this is the next thing that flops like the Fire Phone. I think there's some cool technology here, but I think for smart glasses or whatever you call them, for some sort of glasses product to work, the camera has to be the focal point, and I think there would be some AR tie-in there. And Amazon might have that, but I think Apple and Google have a bigger lead, at least from what they've released thus far. But, I don't know. At first glance, looking at this story, I'm skeptical. I think this might be a flop. But that's the way Amazon goes. They're going to have their failures, and that's just how they operate and they continue to learn each time. Aaron might be more optimistic.

Aaron Bush: No, I totally think it's going to be a flop. But, I do think it's fascinating for a couple of reasons. One, I think that Amazon jumping in and trying to create the smart-glasses product reinforces that this is something that's going to be relevant in technology in the future in general. I think it helps clarify that. And it's important enough that even if Amazon can't come out with something impressive, they're still trying. They don't have a mobile phone operating system. So, the more that they can get literally on people, the better it is for them. The second thing that's interesting, also because they don't have a mobile operating system, it means that Alexa and the Echo are increasingly more important to them. And the more hardware places that they can make that software shine through, the more that reinforces their own ecosystem. And I think this is just one step toward more that we'll see from them in the future.

Greer: So, a longer play.

Bush: Oh, definitely. They're playing the long game.

Aaron Bush owns shares of Amazon. David Kretzmann owns shares of Amazon. Mac Greer owns shares of Amazon. The Motley Fool owns shares of and recommends Amazon. The Motley Fool has a disclosure policy.