Apple may have already lost against Google and Amazon in the smart speaker race


In a Deutsche Bank investor note, analysts from the financial service company claim that Apple has missed the mark by a large margin with the HomePod. The report estimates that HomePod production has been cut down to 200,000-300,000 units per month, putting total sales for 2018 in the vicinity of 3 to 4 million units. Earlier this month, KGI Securities pinned the number of total HomePod sales for 2018 even lower – at 2 to 2.5 million.

The latest investor not from DB paints a dire picture for Apple's foray in the smart speaker market, citing the speaker's limited capabilities and steep pricing as the main driving factors behind the product's underwhelming performance.

The HomePod was Apple's answer to the Amazon Echo and Google Home, but with the two companies already dominating the new market, and with a $200 higher price tag than its main competitors, Apple's smart speaker failed to make the needed splash.

"Apple decided to stick with its premium pricing strategy, introducing the HomePod at $349. In our view, this essentially limits the product's market appeal to Apple fans who will pay anything for a new Apple device and to consumers with high disposable income," the DB report reads.

One of the biggest downsides of HomePod is its compatibility, or lack thereof, with non-Apple products and services. This is something that could be improved in future software updates, but the report claims it may be too late. The analysts predict that virtual AI assistants, such as Alexa, Google Assistant, Cortana, and Siri, will play a big role in smart homes, and that's why the brands behind them need a strong start in the market. First impressions are vital to a new market and can greatly influence the consumers' view on future products, but Apple may have missed their chance, the report concludes.



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27 Comments

1. bucky

Posts: 3790; Member since: Sep 30, 2009

They lost because of Siri and forcing Apple Music on it.

10. sgodsell

Posts: 7419; Member since: Mar 16, 2013

Lost because it isn't a smart speaker. Lost because it doesn't have stereo sound. Lost because it cannot connect to any other speakers via wires or Bluetooth. Lost because it only supports Apple devices, and even then that is limited. There is too much wrong with Apples Homepod.

16. piyath

Posts: 2445; Member since: Mar 23, 2012

Win or lose Apple fan base now has a go to smart speaker of their own. Apple made this product mainly for that reason. It doesn't matter the sales numbers as long as they don't keep any empty slots in their consumer device lineup because it can sway their loyal consumers away from the Apple Eco system.

17. sgodsell

Posts: 7419; Member since: Mar 16, 2013

Did you just crawl from under a rock? Or you didn't see what the competition has for smart speakers? Because Apples rendition of a smart speaker is far from smart. It's using the name smart, but that is the only thing that is smart about it. It's like when some people call Apples iPhone 6, 6s, 7, and 8 plus models a phablet. It's using the phablet term in name only. But those iPhones have no tablet functionality what so ever. Apple purposely leaves that functionality for their iPads, so people will still have a reason to buy an iPad. Unlike their Android counter parts that are phablet in not only name but functionality as well.

23. bucky

Posts: 3790; Member since: Sep 30, 2009

You might not be used to this being an android user but the iPad and larger iPhones have apps specifically for their size. Home screen might look the same but optimized apps for the size are what matter most.

18. Sammy_DEVIL737

Posts: 1529; Member since: Nov 28, 2016

It doesn't matter the sales numbers....... :D

20. Finalflash

Posts: 4063; Member since: Jul 23, 2013

It's just a classic example of a hardcore Apple fanboy. Even the article acknowledge that fanboys will pay anything for Apple products and therefore, they are the only ones buying it.

26. worldpeace

Posts: 3135; Member since: Apr 15, 2016

Sales numbers didn't matter.. It's all about profit :v

15. CandyBar

Posts: 43; Member since: Dec 08, 2017

Siri is terrible and I hate to use my music app because it's a hassle to constantly have to navigate around Apple Music.

27. two_soggy_waffles

Posts: 58; Member since: Aug 10, 2017

and liek, it's too many monies and stuff.

2. Martineverest

Posts: 521; Member since: Oct 27, 2015

even Google is losing money on home

9. RebelwithoutaClue unregistered

Not so sure if Google is losing money on the Home. But overall they are losing money in the Home automation sector, mainly because of Nest and the strong competition from Amazon. And even if they lose money by selling the Home, they are getting data back for their main revenue, ads.

14. sgodsell

Posts: 7419; Member since: Mar 16, 2013

Google moved almost 10 million Home minis alone over the holiday period (Q4 2017). That's not including their original Home or Home Max. Who knows how many they sold this quarter (Q1 2018)? Plus Google's Home allows you to connect to Bluetooth speakers, and can even play stuff on your TV via Chromecast. Google has already moved over 100 million Chromecasts. So adding a Home just makes sense.

21. KyleRiemen

Posts: 170; Member since: Oct 29, 2014

This is like with amazon, facebook, android etc. It is all about market share and being first. You can care about profit later. Once people have 3-4 devices and everything set up to your device, they are unlikely going to switch the ecosystem. I have an amazon echo dot for 29€, got a google home mini for free and bought 2 additional home mini each 18€. It is clear, that both are on war and could not care less about proft at the moment.

3. surethom

Posts: 1712; Member since: Mar 04, 2009

Apple. Need to do 2 things 1 add Spotify 2 Drop the price by £100

4. ahmadkun

Posts: 608; Member since: May 02, 2016

Hi .. i'm 3.5 mm AKA jack just came here to say hello

5. meanestgenius

Posts: 22191; Member since: May 28, 2014

Hey, can’t win ‘em all, Apple. It’s gonna be tough for anyone to beat Amazon in the Smart Speaker race.

6. jove39

Posts: 2147; Member since: Oct 18, 2011

Rename it to HomePod X and set price to $999. Then it’d sell like hot cakes ;)

7. emvxl

Posts: 141; Member since: Sep 29, 2009

Damn, that was quick. Give it time though. As for me, I'm keeping the HomePod I got as a gift right where it is - in the box it came in.

8. japkoslav

Posts: 1516; Member since: Feb 19, 2017

They lost because if you want to sell smart speaker, it has to be smart. + Vendor lock certainly did not help as well.

11. tokuzumi

Posts: 1919; Member since: Aug 27, 2009

Smart speakers are a waste of money. In 5 years, we are going to find that our conversations are being stored on the company's servers, and will be used against us, either in a courtroom battle, or some hacker who tries to blackmail us to not release what we have said.

12. jacksmith21006

Posts: 68; Member since: Nov 03, 2015

The HomePod is a shocking bad product. Then considering it came from Apple is baffling. No mic mute button? Wife verbally mutes with voice, leaves room, you enter room yellling at it to discover it is mic mute. Why on earth did Apple engineers just not buy a Google Home and Echo and copy? Then on top of all this there is Siri which is just awful. Even the sound from the Homepod is inferior to the Gogole Home Max. Do NOT even get me started on no input jack to use the HomePod as a speaker.

13. Be_Mine

Posts: 284; Member since: Dec 29, 2013

Apple probably tried to pull the iPhone X trick here too. Sell the product at a much higher price in comparison to rival's products. So even if it sells lesser, they will still have a huge profit. But I guess that is not always going to work.

19. apple-rulz

Posts: 2178; Member since: Dec 27, 2016

When a Samsung product sells poorly; “Toyota sells more than Ferrari, but the Corolla isn’t as good as a Ferrari!!!!” or “McDonald’s sells billions of hamburgers every year that doesn’t make them prime rib!!!!!” So using Samsung worshipper logic, the Apple HomePod is a fantastic product by sole virtue of not selling well.

22. Tipus

Posts: 893; Member since: Sep 30, 2016

ROFL, someone is really butthurt and yet still trying to blame samsung for some reason. Accept it , homepod sucks :)))

24. apple-rulz

Posts: 2178; Member since: Dec 27, 2016

Obviously reading comprehension isn’t your strong suit, so no sense in further trying to engage you.

25. sissy246

Posts: 7124; Member since: Mar 04, 2015

LMFAO It is a pretty good speaker, it is not a smart speaker. Don't be so butt hurt

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