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Whiz robot from SoftBank arrives as Pepper renewals lag

By Rian Whitton | November 19, 2018


Whiz Robot

SoftBank’s Whiz robot, an autonomous floor cleaner. (Credit: Bloomberg)

Late October spelled bad news for Pepper, the quintessential and iconic face of Softbank Robotics. According to a Nikkei Tech survey, only 15% of companies planned to renew their three-year contract with the robot provider that began in October 2015. The contract involved deploying Pepper in corporate settings, including banks and offices, for purposes of entertainment, hospitality and so on.

The fact that few wished to renew is a humbling sign to the Softbank behemoth, which has gobbled up robot hopefuls like Aldebaran and invested in well-known manufacturers like Boston Dynamics. In the case of Pepper, the lack of a clearly defined use case has led to questions about its long-term viability as anything other than an interesting prop.  When 23 out of 27 companies surveyed do not plan to renew, it suggests Pepper may not be long for the commercial market.

Pepper’s struggles are likely part of the reason for Softbank’s expansion into more practical robotics applications with its new robot Whiz, an autonomous floor cleaner. The Whiz robot will go on sale in Japan in February 2019 under a robotics-as-a-service (RaaS) model for $222 per month. The Whiz robot uses self-driving software and sensors from Brain Corp., a San Diego-based startup that raised a $114 million funding round, led by the Softbank Vision Fund, in mid-2017.

Softbank, which announced the Whiz robot at a news conference today in Tokyo, said it comes with a handle that a human uses to “teach” it the layout of the space. Once you teach it the space, the Whiz robot can perform the cleaning autonomously. The Whiz robot features a laser range finder, 3D camera, collision sensor and a battery that lasts three hours.

Challenging times for robotics companies

There are multiple reasons companies are not renewing their Pepper contracts. One executive said, “the boom has gone.” Whatever novelty Pepper may have had three years ago, the robot is costly, takes up space in the lobby, and its functions can be easily subsumed by cheap human labor or other technologies like web services. The lack of price competitiveness coupled with no clear mission suggests Pepper’s future as a viable commercial product is moot.

This has been a challenging 12 months for the robotics industry. On the consumer side, Jibo and Mayfield Robotics folded due to high cost, lack of identifiable market, and inability to compete or distinguish themselves from the excellent range of cost-effective smart home devices offered by Amazon, Google and others.

On the industrial side, Rethink Robotics’ pioneering vision was not enough to mask a flawed technical product and the company was not able to focus on its niche use case as a research tool. For sUAS, Airware tried to be a comprehensive operating system for the industry and ended up burning through tens of millions of venture capital.

Many investors have called the industry’s bluff and suggested the robotics opportunity is overvalued. I disagree. Robotics is being adopted at an accelerating pace. At the level of industrial robotics, Chinese demand and the re-emphasis on manufacturing in the developed West is leading to significant growth. There is reason to believe this will only become more so with the issues of acute labor shortage and aging populations.

Mobile robotics is experiencing even faster growth, with ABI Research predicting the warehousing market for commercial robots to grow from USD $2.5 billion in 2018 to USD $ 30 billion in 2027, with most value stemming from materials handling.

Pepper robot

Focus on a solution, not a product

The issue is the emphasis of the robot as a product, as opposed to a solution. No industrial robot makes sense without a much larger hardware and software architecture behind it, and no individual arm makes sense outside of the context of a clear use case where the robot deployment clearly provides productivity gains. Given the state of current robotics technology, companies are far more likely to succeed by building their system around a particular use case.

This has been effective for iRobot and Kiva Systems (now Amazon Robotics) for instance. In the case of Softbank, the strategy appears to have been to develop highly sophisticated systems and wait for the market to take them on. This has not worked. There simply is no possibility of a general-purpose robot that can be fitted to multiple tasks across multiple industries.

The closest we have to this is Sarcos Robotics, a company that is successfully marketing two highly adaptable robot systems (a mobile surveillance system and a tele-operated mobile arm platform) that work on a RaaS model. In these cases, the platforms have enjoyed adoption in niche use cases, such as material handling on nuclear decommissioning sites, and are likely to succeed further due to Sarcos’ genesis in the US military. But this sort of model, with highly flexible systems with multiple use cases, takes decades of research to incubate. When the market is mining or legacy nuclear infrastructure, that is one thing, but when its B2C, as it was with Jibo, the chances of success are slim.

Pepper’s struggles are unlikely to deter Softbank from the robotics market at large. Its investment in proprietary OS developer and navigation provider Brain Corp makes Softbank well placed to be a key player in mobile robotics going forward, especially now with the Whiz robot. As Brain Corp is OEM-agnostic, it has a wider appeal than investments in Boston Dynamics, Pepper or robot pizza maker Zume.

The companies that help galvanize robotics adoption will not do so by investing in novel hardware technology. There needs to be a stronger focus on enabling technologies that make robotics possible, including better drives, cloud robotics platforms, IoT microlocation sensors and alternative operating systems to ROS.

Rian Whitton, ABI Research

About the Author

Rian Whitton is a research analyst for ABI Research, a market intelligence company focused on the most transformative technologies and their impact across industrial, commercial and consumer markets. As part of the Strategic Technologies research team, Rian provides an analysis for Robotics, Automation, Intelligent Systems, Artificial Intelligence and Machine Learning. He has also written actively on the commercial application of unmanned aerial vehicles. He has been a speaker at the Robotics Summit & Expo, produced by The Robot Report, and regularly contributes to media outlets like Bloomberg, Thompson Reuters, ZDnet, Recode and the Financial Times.

Prior to ABI Research, Rian graduated in 2017 with a Master’s degree in Science & Security from King’s College London, researching the intersection of technology and defense. He has chaired panels on and spoken at academic events about the intersection of technological innovation and defense, particularly in relation to AI and Robotics.

Comments

  1. Mark Neppl says

    November 20, 2018 at 12:48 pm

    Awesome insight about adoption or lack of it. Cobots do have a role in the everyday, it just takes time. Commercialization happens just not on investors timelines.

    Take the space of residential trash and recycling removal. This could easily be done with on demand and robotic automation solutions. It will be the economic pressure that brings this about. Cities and country governments must see the value of innovation to that of outdated economic engines, that waste millions of dollars. Robots can provide much better services at lower cost but that takes time and will. Governments should demand that innovation be part of the requirements to do business with vendors. Adaptation takes time and the will to do so.

    Reply
  2. Adam says

    November 20, 2018 at 6:44 pm

    It’s a shame that the Author doesn’t understand how Pepper is sold. There is no contract after 3 years. Mr Whitton is poorly informed and an article written for attention. Pepper is sold and there is no “renewable option”.

    Reply
    • Charles says

      December 1, 2018 at 10:53 am

      Actually yes, he is right. In Japan the robot was sold with a 3 years contract.

      Reply
  3. Hector L. Bombino says

    November 21, 2018 at 9:34 am

    In my opinion, the reason why Jibo and Kuri failed was not because of high pricing but for lacking in capabilities and able to engage with a human. In case of Kuri, it could not talk or be able to connect in a way that a humanoid looking robot would look, same reason for Jibo. It did not look a humanoid and lacked mobility . If SoftBank was able to market Pepper as an open source, the “geek” community including myself would buy one. If they could market this unit for less than $2000 and even with a reasonable annual or monthly software maintenance, they would sell to not just the public but schools and Universities!;;are you reading this SoftBank? Refocus your Markets to the consumers.

    Reply
    • Vincent Clerc says

      December 6, 2018 at 8:30 am

      Well at 2000$, they would make no money! Trust me one this one!
      But, I do agree that Softbank biggest mistake is to keep the platform’s software close… Pepper is a wonderful robot but Programming it takes time and efforts… and the software framework is very sophisticated which is something third parties do often underestimate, leading to poor implementation and uninteresting, too basic applications!!

      Cheers!
      Vincent C.,
      Maker of Pepper.

      Reply
    • Brenda Dennis says

      February 12, 2019 at 3:26 pm

      Absolutely agree !!

      Reply
  4. Vilas Chitrakaran says

    November 22, 2018 at 3:31 am

    “Many investors have called the industry’s bluff and suggested the robotics opportunity is overvalued”. Many of us in the robotics industry are culpable for adding to the hype. Over the last couple of years, the dust is beginning to settle; it is becoming clear that a product that doesn’t solve an actual problem will remain a short term novelty that easily wears off and not find a market, no matter how technically sophisticated. This has always been true, of course. For some reason, when it comes to AI and Robotics, we seem to forget this rule.

    “..companies are far more likely to succeed by building their system around a particular use case.”

    Spot on!

    Reply
  5. Ray says

    October 11, 2019 at 11:07 am

    I began ordering a Pepper-robot after initial signs showed 12,000 DKK,
    after a short time details emerged of 12,000DKK. PER MONTH was the reality
    -and for as I recall 19 monthis in total.
    I CANCELLED Completely and lost interest.

    -it dosent surprise me that interest is falling, internet searches can yield the same and more information, “with voice read” so “Pepper” is basically a self propelling Voice activated Tablet in essence.

    Reply
    • Steve Crowe says

      October 11, 2019 at 12:35 pm

      Ray, your last sentence is spot on. Many other consumer/social robots are also tablets on wheels.

      Reply
      • Ray says

        October 11, 2019 at 1:20 pm

        Steve, well the disappointment was large, then reality set in so I relaxed and bought a Segway, at least I could have some fun hehe (:
        -Im looking at a “Loomo” (pay one time and it has SDK that has NO HIDDEN extra monthly fees like ‘Pepper !)
        -I report back if the deal goes through (:

        Reply

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