“Apple recently cut the prices for its HomePod smart speaker worldwide. It reduced the speaker’s U.S. retail price 15% from $349 to $299, and by as much as 18% in certain markets in Europe and Asia,” Leo Sun writes for The Motley Fool.
“According to Strategy Analytics, Apple shipped just 1.6 million HomePods in the fourth quarter, indicating that it remains a niche product even for iPhone users. By comparison, the company shipped 9.2 million Apple Watches in the same quarter,” Sun writes. “Will cheaper HomePods help the device gain more traction, or is it a lost cause?”
“Apple’s HomePod strategy was questionable from the start. Many consumers scoffed at the $349 price tag, since Amazon’s and Google’s devices are much cheaper,” Sun writes. “Simply put, Apple was trying to sell a device with fewer features at a much higher price, and promote the HomePod as a high-end wireless speaker for audiophiles, although consumers could already buy high-quality speakers for less than $250.”
Read more in the full article here.
MacDailyNews Take: Once again, Apple is not trying to move units for the sake of moving units. So, Sun is judging Apple’s HomePod in a race (market share) in which it is not entered.
Apple’s HomePod likely owns a significant share of the premium smart speaker market, the only market in which Apple’s HomePod participates.
“Oh no, Apple just slashed HomePod’s price!” the naysayers exclaim, as if the sky were falling. Apple also slashed iPhone’s price after launch. How’d that work out? Like this: Apple sold 217.72 million iPhones in 2018, up from 216.76 million in 2017, and up from 211.88 million in 2016.
People who buy cheap sub-$100 speakers are far less likely to subscribe to services like Apple Music. Amazon et al. can have them.
Apple’s HomePod sales increased 45% during the holiday quarter which is very meaningful since every buyer is or will likely become an Apple Music subscriber, generating the type of recurring revenue that very few cheap speaker buyers would ever provide.
As it ever was: Apple sells premium products at premium prices to premium customers.
SEE ALSO:
Apple cuts price of HomePod worldwide, now $299 in U.S. – April 4, 2019
No, Apple’s HomePod is not a ‘flop’ – March 8, 2019
After a year with Apple’s HomePods, I’m glad I bought them – February 28, 2019
Apple’s HomePod sold 1.6 million units last holiday quarter – February 20, 2019
Apple’s HomePod shipments surged 45% in holiday quarter – February 19, 2019
Newsflash: Apple sells premium products at premium prices to premium customers – October 23, 2012
Price drop was perfect. I just bought 2 home pods.
My Bose soundlink is great. Have had it for 4 years and there’s zero reason to switch and buy HomePod. Offers nothing. I already have Siri on my iPhone that comes through on the Bose, not like I use Siri much anyway.
I care – I just bought 2 more because of the price drop – now have 3 stereo pairs around the house instead of a stereo pair in LR and only single in office and Bedroom. I love HomePod – too bad Siri is so f*%#ing stupid.
Yeah but you can get a better speaker for that money.
Alexa is smart. Connect your Echo to a good speaker using bluetooth or a wire.
Profit!
Using your own speaker of choice is exactly what the Echo Input product was intended for.
I do not consider a 15% price reduction to be “slashed”. Any discount of 20% or less to me, is a modest price reduction. Generally, I don’t buy things on sale unless there is at least a 25% price reductions. (Of course, I would prefer 40% off.)
They are not called Motley Fool for nothing,
They could set the price at whatever they wanted to if they would just like users control their own iTunes library instead of trying to force users to sign up for AppleMusic. If I already have a library I paid good money for, why should Apple prevent me from accessing it through HomePod? Greed, that why.
You are not prevented from playing your music library on HomePod.
Use AirPlay to stream your own iTunes library to your HomePod.
More info: https://support.apple.com/en-us/HT202809
I’ve got a little HomePod story to tell . . . . and it’s a clear example of 1) knowing what you have in a device and 2) watching it absolutely excel within that context.
Long story short, went on a vacation recently with a bunch of other couples to stay at a beach house with a pool/entertainment area. Everyone had to fly to get there and we all were going to be in a partying mood. We needed a sound system. I said, “I got this.” I show up with a single HomePod. No one else (sadly enough) had ever seen one. I plugged it into an outdoor outlet. Just before that, I got my iPhone on the house’s wifi and discreetly put it away. . . waited a few seconds and said, “Hey Siri, play Jimmy Buffet radio” and away the speaker went pumping out loud and clear and sound that filled the entire space with party music. By the end of the weekend, everyone wanted to know how much they were and where to get one. It’s usually just a matter of knowing how to work something and what it’s made for. I had access to all of my play lists and 50 million songs and all I really had to do was plug the dang thing within a wifi network. Dead simple, and awesome fun.
In other words you just described what any $50 bluetooth speaker can do. Or any wired speaker + iPod could do for the last 20 years. Not a very critical listening environment.
I’ve already got dozens of playlists and can whip up new ones in moments or on the fly. Why do I need to rent Apple music? Sorry, but $250 for the privilege of takling at brain dead Siri isn’t a bargain in my book.
Sound quality. Traveling size. Simplicity in the specified environment. I — or anyone in the traveling party — could utilize it on the fly. It is these factors that made it the right tool for the job. We had several Bose soundlink speakers with us too, as an example, and none were powered on. And it most certainly was a critical listening environment. The speaker worked well within it.
I LOVE our HomePod. We had a Play 5 SONOS in the living room and full SONOS 5.1 Surround upstairs. The Play 5 NEVER got used. I was the only one in the house that listened to it. My family just hated the app. Now we have a HomePod downstairs and EVERYONE loves it. We have music in our home again. Everyone wants one in other parts of the house (and I got my own Play 5 in my office). Will be buying more. $249 would have REALLY been a sweet spot though 🙂
“every buyer is or will likely become an Apple Music subscriber, generating the type of recurring revenue that very few cheap speaker buyers would ever provide.”
Don’t be so sure about that. I bought 2 HomePods at Christmas and do not plan have an Apple Music subscription. I ended up returning them because the sound wasn’t as good as expected/hyped. With the recent Netflix/Airplay news, I have to say I’m glad I did.
A pair of Echo Dots cost $50.
A pair of battery powered speaker bases for them cost $150.
For $200 I have a set of truly wireless smart speakers (that sound pretty good to my ears) that I can take anywhere in my house or on my property to listen to Apple MUSIC – yes I’m one of the cheap idiots that bought Echos, and yes I subscribe to Apple Music too!
I spent 30 minutes screaming at Siri to tell me the forecast.
In that same amount of time, Alexa read me the news, got me the forecast, told me a joke, tuned to SiriusXM, and added items to my shopping list. I’ll take the cheap Echos and Alexa any day of the week!
“Apple sells premium products at premium prices to premium customers.”
An iMac with a 5400RPM hard disk and no SSD in 2019 is hardly premium.
Instead of an entry level system you could consider one with an i9, 1GB SSD and add your own 32GB of RAM, but that wouldn’t serve your predetermined narrative as well.
I care, I have four of them and paid full price. LOL
You may have price protection depending on what card you used to buy them and when.
I’m in the same situation as you, Rob!
Interesting Microsoft (and others) sells plenty of products that sell in numbers like this yet the analysts still cream over them as if they are the most popular gadget in the world. Funny old World where Apples overall success is used against them in comparison to others limitationa. Some people just can’t lose their prejudices when an easy doom laden story is at hand. every product Apple has sold has had it to a lesser or greater degree and oh how they hate to be made fools of in Haters HQ.