Google Home costs $50 less than Amazon Echo because it's made of older, cheaper parts

Google's got a brand new product in a brand new product category: It's called Google Home, and it's a hybrid personal assistant/speaker.

Hollis Johnson/Business Insider

It looks like a little speaker, but it's actually a voice-activated personal assistant - simply say, "Okay Google" and your command. "Okay Google, what's the weather?" for instance, or "Okay Google, what's the closest pizza shop?" You've got questions, it's got answers.

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If the idea sounds familiar, that's probably because you've heard of Amazon's Echo - it's a speaker that lives in your home that's also full of microphones, ready for your every (voice) command. This guy right here:

Amazon

There are some crucial differences between the two:

• Home is powered by Google's AI "Assistant" software, while Echo is powered by Amazon's AI "Alexa" software.
• Home is shorter and squatter than the Echo.
• Home costs just $129, while Echo costs $179.

It's that last bit that we're concerned with here - the price difference is crucial, especially considering how similar the two are. Given how both devices share much of the same functionality, what's causing the $50 price difference?

From the looks of a new teardown, it's a simple measure of the components used.

Simply put: Google Home is made out of existing products that Google already sells, making it far less expensive to manufacture. iFixit discovered as much in a teardown of Google Home it published this week.

The chips powering Home, for instance, are the same chips that previously appeared in 2015's Chromecast device.

Google

Google's device also has far fewer microphones - just two to Echo's seven. And that could make a huge difference in these devices' ability to hear your commands, which is its main form of input.

Indeed, voice control is the entire raison d'être of these devices.

In my personal use of Google Home across the past week, I've encountered few instances where the device couldn't hear me - but even one repeated command is enough to make you feel like an idiot. Who wants to repeatedly shout at a robot?

In any case, if you're wondering which of these two devices is right for you - and wondering why there's such a large price discrepancy - now you're armed with more info than ever. Check out the full teardown of Google Home for even more!

Disclosure: Jeff Bezos is an investor in Business Insider through hispersonal investment company Bezos Expeditions.