Deutsche Bank analysts claim Apple’s HomePod smart speaker has ‘missed the mark’

“HomePod smart speaker, its first big product innovation since the Apple Watch, is looking like an expensive mistake. And that early misstep might cost Apple an important new market,” Shona Ghosh reports for Business Insider India. “That’s according to Deutsche Bank’s brutal analysis of the HomePod’s performance and its importance in smart homes.”

“In an investor note, analysts at the bank wrote: ‘We believe that Apple had a real opportunity to become a major player in the smart home with its introduction of the HomePod smart speaker. However, poor reviews and a significant fall-off in demand post the launch suggest the company has missed the mark,'” Ghosh reports. “The HomePod was meant to take on the Amazon Echo, Google’s Home speaker, and even companies like Sonos. The Echo is the most popular smart speaker in the US, though Google’s Home is gaining. But the HomePod is pricey. At $349 or £319, it’s $200 more expensive than its rivals.”

‘Apple decided to stick with its premium pricing strategy, introducing the HomePod at $349,’ the analysts wrote. ‘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,'” Ghosh reports.

MacDailyNews Take: Duh. Exactly.

Read more in the full article here.

MacDailyNews Take: Deutsche Bank’s analysis is indeed “brutal,” as an indictment of the quality of Deutsche Bank analysts who in 2018 still do not understand the basics of how Apple Inc. works.

Newsflash: Apple sells premium products at premium prices to premium customers.

Newsflash: Apple sells premium products at premium prices to premium customers – October 23, 2012

The Inquirer reviews Apple’s HomePod: ‘Looks great, sounds fantastic; Siri needs work’ – April 6, 2018
I want another Apple HomePod for sure, maybe two more – March 20, 2018
Sound quality shootout: Apple HomePod vs. two Sonos Ones – March 16, 2018
Apple HomePod: The audiophile perspective plus 8 1/2 hours of measurements; HomePod is 100% an audiophile-grade speaker – February 12, 2018
Apple’s HomePod is actually a steal at $349 – January 26, 2018
Digital Trends previews Apple’s HomePod: Impressive sound coupled with strong privacy – January 26, 2018
Hands on with Apple’s HomePod: Attractive, ultra-high-quality speaker, an excellent Siri ambassador – January 26, 2018
Apple’s HomePod, the iPod for your home – January 25, 2018
One hour with Apple’s new HomePod smart speaker – January 25, 2018


  1. Apple’s home pod will get better with superior software release that allows pairing. Cheaper half price Amazon and google will sell more but the sound quality is inferior to the Apple Homepod. However what is an issue here is that Apple’s correct boasting of hard ware and software integration, “it just works” is not apparent here. Google and Amazon atm have better AI / software assistants in their cheaper (albeit inferior sound) hardware

    1. Amazon definitely has better assistants, and a broader range of services to use on it – SiriusXM, Nest, etc.

      Picked up a couple of Amazon Echo Dots when they were on sale for $30 back in November. As well as a couple of rechargeable stereo speaker bases to put those Dots in for $45 each. For $150 I have 2 portable stereo systems (which HomePod is NOT either stereo nor portable) that sound pretty good to my ears, and do a whole lot more!

      How much does that HomePod cost …

        1. @ M: applecynic beat me to it. There’s absolutely no way I’d ever allow a “smart” speaker into my home, but I do have friends with them and the puck itself sounds like rubbish. However unlike the Homepod, the Dots have throughput so you can mate them to high quality speakers.

          Once upon a time when the engineers at Apple were allowed to do really versatile hardware, they developed a really neat Airport Express which also allowed wireless audio networking. Problem is, Apple management allowed that excellent product to die on the vine. Bringing the Airport Express into the modern era with 802.11ac and Airplay II and adding a connection or two would have been a brilliant step forward. Instead Apple offered a small trashcan – just like the 2013 Mac Pro, overpriced and underfeatured.

          1. Most excellent idea to use defunct Airport and tie together all components in the Apple ecosystem.

            Unbelievable how they have not thought this through. When you get out of the box VERY LATE to the party to compete with established industry leading products, besides high price and high quality, you have to offer EVERYTHING, the completion offers and MUCH MORE. Hence, the poor uptake and rightly so.

            The only “brutal analysis” that is needed at Apple at this time is measuring Cook’s performance by the BODs in so many areas, tardiness and outright neglect of products (Macs), lead the long list … 🙁

          2. Didn’t mean to steal your thunder, but one of my dots is indeed hooked up to an A7.
            And btw, it’s going to be difficult to convince me that Aux input isn’t absent from the HomePod for that very reason, to prevent people from substituting Siri on an Apple device.

            “It’s our ball and we make the rules, we just pretend to care what’s best for you” – Les Pommes

        1. Do you have that in writing from Apple or are you just exercising blind faith? I have never heard Apple say they don’t datamine you. They only claim — but do not guarantee — they won’t sell it. No guarantees that your data won’t be intercepted or hacked by a bad actor at Apple or elsewhere either. Remember, cryptocurrency is supposed to be secure and it’s hacked all the time. With physical access, Apple gear falls as fast to hackers as any other computer in hacking contests year after year. What precisely makes Apple invulnerable in your mind?

    2. Keep dreaming.

      If you’ve chosen to listen to compressed Apple Music, and you’re too lazy to set up your room for proper stereo audio, then audio fidelity isn’t your top objective.

      Affluent audiophiles already own vastly superior sound systems with infinitely better capabilities and features, including integration with any music source, archive, component, or service they want.

      People looking for a deal can get better functionality Airplay speakers for equal or less price.

      For people willing to put digital data mines in their homes, Apple’s false claims of privacy and security offer no value.

      Anyone with their own music collection will be immediately frustrated by the poor integration the Homepod offers even with Apple’s own hardware.

      Finally: Siri is as dumb as a box of rocks, already in your pocket. She’s not worth giving more home space.

      1. I’m in your boat too for the most part. I have MUCH higher quality audio equipment already so the HomePod is simply not going to appeal to me. Additionally, Apple’s sticking only to its own ecosystem with Apple Music support and nothing else isn’t attractive in the least at this point. For the “well healed” buyer, the combination of Sonos (for its integration of many music sources only – not for it’s speakers) and a high quality amp and speaker system will deliver far better results than anything HomePod can hope to. I have Apple Music, Soundcloud, Tidal, Slacker Radio, iHeartRadio and several others all connected through Sonos (each has a niche strength).

        Apple TV is decent because it of its integration with iTunes….but also because it offers Netflix and Amazon Prime video and lots of others. Customers have choice. HomePod isn’t there yet as a service hub (and maybe never will be).

        Apple’s commitment to privacy and security matter to me, but this is one product that I simply don’t have a use for and probably never will.

    3. This is what I posted on another blog.

      “Apple simply “missed the market,” the analyst [Sherri Scribner] said.”

      This is incredibly weak analysis. It isn’t at all surprising that it comes from Sherri Scribner.

      First quarter sales of the iPod were immaterial (under 5% of gross) to Apple’s financials. It wasn’t until full-year F2002 that iPod became material to Apple’s revenue.

      First quarter sales of the iPhone were immaterial (under 5% of gross) to Apple’s financials. It wasn’t until full-year F2008 that iPhone became material to Apple’s revenue.

      First quarter sales of the iPad were material (over 5% of gross) to Apple’s financials.

      First quarter sales of the Apple Watch were immaterial (under 5% of gross) to Apple’s financials. Three years since its original launch Apple Watch revenue remains below the material threshold (5%).

      That’s some pretty good company to be compared to, and only one of the 4 had an immediate material impact on Apple’s revenue.

      Alexa and Google Home have both been on the market for at least 2 years longer than the HomePod, as was the case for the iPod, iPhone, iPad and Apple Watch. Each of those products ultimately came to dominate their respective industries, so much so, that some of the largest players in their respective fields are no more.

      Sherri Scribner being negative on the HomePod (as she is with anything related to Apple) is a strong buy signal.”

      Ghosh’s comments are typical of someone with zero business knowledge. Ghosh is nothing more than a regurgitator of other’s original work and is a poor example of journalism in action.

  2. The limited abilities of Siri would be offset if there was a (comparatively) cheap way of fitting out an entire house with the functionality. HomePod is just too expensive to give truly universal convenient coverage. I’ve started putting limited home automation in place (a few lights in multiple rooms) and have started using Siri a bit more to control them. For what I need to do Siri is fine, but I don’t always have my phone, my Apple Watch doesn’t always pick my voice up first time. If I could put a few devices around the house to accurately pick up voice commands first time I’d buy them immediately. If there was an option of having this as part of an Apple TV I’d upgrade my existing models as well. I don’t mind that Siri can’t do a lot of the stuff others do (a lot of which is a bit gimmicky), but what I want is 100% accurate recognition of what it is supposed to do at a price that won’t break the bank so that I can continue to be part of the overall Apple eco-system.

    This is the main thing Apple have missed. HomePod (or an equivalent) is not about making a high profit device in it’s own right, its as much about supporting the existing eco-system of Apple products. There’s almost a case to be made for selling them at minimal profit in order to keep people using their services and other hardware. I have a decent set of fairly expensive speakers already for when I want to listen to music. I don’t need to spend hundreds of dollars to duplicate that with a device that doesn’t offer an significant upgrade on my existing stuff.

          1. Which is what most folks are doing, apparently. The reason apple became so successful is because they made products that appealed to and made sense for EVERYBODY, not just fanboys or ‘premium customers’. In case you haven’t noticed, when it comes to the iphone, it’s not just ‘premium customers’ who have to have one. It’s attractive enough that even non premium customers will find a way to get one. Homepod is a fanboy special. Just like apple TV. And the latest round of macbooks.

            1. “Which is what most folks are doing, apparently.”

              I’m not saying HomePod is outselling the competition (I don’t believe it is), but we just don’t know how well (or bad) the HomePod is doing. All we have are estimates from notoriously bad analysts who are comparing against THEIR expectations, not anything Apple has provided, in its very first quarter of sales. HomePod criticism, just like criticism of the iPod, iPhone, iPad and Apple Watch before it, is extremely premature.

            2. “HomePod criticism, just like criticism of the iPod, iPhone, iPad and Apple Watch before it, is extremely premature.”

              I don’t believe that is accurate. You’re implying criticism of HP is the SAME as the four launches of Apple products you listed above. The big difference you are NOT mentioning is all four of those products were groundbreaking, revolutionary, with no REAL competition to speak of.

              In other words, nothing like the four was ever released before and Apple went where no one has gone before. With no reference in the universe for the clueless critics to compare it against, the usual knocks about pretty high priced objects and little understanding of how it actually works is to be EXPECTED.

              The HP release is DIFFERENT. Four years late to market playing catch up to rest of industry that Apple did not introduce revolutionary first, unlike the other launches.

              That said, with the HP release we can only compare price and features to the rest of the leading competitors. Sorry fanboys, Apple did not WOW everyone with critical thinking skills by introducing a nice high priced speaker, walled garden operation denying competing services and next to featureless operation that is already available to others.

              My Android friend said it best something like you get a nice speaker, but for that kind of money it doesn’t do this or it does not do that. The average person will look at it the same way. Apple loses, at least for now …

        1. LOL! 😆

          You have a real talent for identifying and relating the problems succinctly in just five words mixed with humor. Something the fanboys are seriously incapable of, well done …

  3. Amazon would need to sell 7 Echo Dots for every 1 HomePod to make the same amount of money. Is Amazon able to achieve that number? I know they’re saying Apple missed the mark, but whose mark are they talking about? The bank’s mark or Apple’s mark? There’s no way Apple can compete with Amazon on total sales for smart assistants/speakers. Amazon has at least five different Echo models at various price points all lower than Apple’s HomePod price. Amazon is going after multiple tiers and Apple is only going after a single tier.

    Is the bank saying Apple’s business model for a smart speaker is flawed in that respect? I honestly don’t understand why Apple’s business model is always considered flawed when the company appears to be in relatively good financial health.

    If Apple’s business model is flawed to such a degree, then why doesn’t Apple’s management do something about it? They certainly have the means to do whatever is necessary to at least modify their business model. It’s really disheartening to think that every decision Jeff Bezos makes is perfect and every decision Tim Cook makes is screwed up. That doesn’t make any sort of sense to me.

    1. You think Amazon can’t sell 7 Echo’s for every HomePod? Seriously? I think roughly half the people I work with have Amazon Echo’s. None of my coworkers have HomePods, despite most having iPhones.

      The HomePod is a complete failure for two reasons.

      1. Missed the Christmas season. Tim Cook, the operational genius, could not deliver HomePods in time for Christmas, despite being in the “pipeline” for SEVEN years.

      2. Ridiculously miserable software (Siri). Eddy Cue strikes again.

    2. We realize there are people here who are fans of one or more of Apple’s product platforms, and there are some people who are just investors and would cheer if Apple sold chrome plated dog shit to affluent airheads.

      Amazon will probably reveal the actual sales of its products, whereas Apple does not. So we may never know. But it’s a very good bet that Amazon will sell well over 7:1 Dots per Homepod. The Homepod costs over 10 times as much and you can’t even use it to order more toilet paper from Big Brother Amazon.

      Apple under Cook makes its money from services, and is totally blind to the reality that most of the current Apple hardware is an overpriced underfeatured mess.

      As a business guru, you should also consider the nonrecurring product development costs. Apple brags about how much they spend in development — what is the actual return on that investment? For Amazon, the Alexa investment was already made a long time ago. Developing the little Dot cost practically nothing. Thanks to constant home spying, Amazon will never be behind Apple in voice assistant technology. The market will decide, and it’s not falling in favor of the laggard Apple. Let us all know why Apple’s financial report tells you otherwise.

        1. I disagree. The reason Wall Street and consumers love Amazon is because it pushes the envelope and doesn’t charge a fortune for it. Amazon is the scrappy hungry company Apple used to be.

          If you look at the financials, you’ll see Amazon appears to make no money for 3 reasons:
          1) apple-like tax avoidance schemes
          2) huge reinvestment in growth
          3) lots of product innovation—not all good imho, but clearly putting money into things that could leave Apple and Microsoft in the dust

          You can poo poo them all you want, but Bezos is the Jobs like leader who gets shit done. Cook is a limp wristed manager collecting easy ios store money, letting Apple get fat and lazy while the rest of the world keeps moving ahead.

          It should be noted that Cook hasn’t actually done a product or service introduction that wasn’t preceded by an Amazon or Google or other predecessor. While Apple relies on iphone sales, Amazon is well on its way to being #1 in electronic retailing, product distribution, media distribution (movies and music both!), voice based computing, business backend server and cloud services, and possibly future personal transport. They are not there, but the trajectory is pointed there. To top it all off, Apple is a massive Amazon customer. The question has been asked increasingly lately: does apple know where it is going? I think i know the answer and it’s a bad direction. Cook wants to be the big brother of his closed garden mainframe computing cult. Ios everywhere, always demanding network connect to do anything, rental payment monthly to apple in order to access your data. I don’t like it.

  4. Apple missed the boat on this, Apple missed the boat on that….Apple stock dropping like a rock yadda yadda. People are buying older iPhone models rather than the newer horribly expensive ones.
    Steve must be rolling around in his grave.
    Now when I buy an Apple product, there seems to be a problem with it before the end of the year. I am glad there is good customer service but that is beside the point. Poor quality control seems to be occurring more and more.

    I have always worried about this but I am starting to think that Apple is no longer visionary. Steve was truly gifted. Tim is not.
    Is Apple starting to circle the porcelain bowl…… ?

    1. When Amazon, Google, or Microsoft can actually turn a real (not fake) profit in hardware, then Apple might be in a run for their money. Today or next year they are not.

      1. With Amazon it should be obvious profiting from the HW is not the aim. The devices are ever increasing number of gateways to buying from Amazon or using their services. A task in which they are hugely successful. I am willing to bet a higher percentage of Amazon HW is used to purchase larger volumes of Amazon products and services in comparison to Apple HW used to purchase Apple products and services. So Apple may make a large profit up front, Amazon plays the longer game of continued purchases. It should also be noted there are probably more Apple HW devices used to purchase from Amazon adding further ‘gateways’ than the reverse.

  5. “…this essentially limits the product’s market appeal to Apple fans who will pay anything for a new Apple device…”

    That is highly insulting and total crap. I am very frugal and careful with my money. Either Apple earns my patronage, or it doesn’t. I don’t blindly buy Apple products. In reality, there are very few of these mythical Apple lemming who will pay anything for a new Apple product. You, sir, are a poor and lazy journalist.

  6. The analysis is right. Tom Cook and team have arrogantly made fun of other companies products while getting left in the dust and potentially crippling Apple in the future. Tim is nothing but a caretaker. Not an innovator or risk taker. Sure he will take credit for Applea current market cap and cash position. Apple should be double where it is today. Tim Cook and especially Eddy Cue have destroyed a great company. Apple needs new management.
    Don’t forget
    Tim Cook was 2 years late with larger acreen phones
    Left the MacPei for dead
    Purchased for 3b Beats when he could have our purchases Netflix for 20B. Yes If is correct
    4 and 5 year Headstart on AI with Siri over Google and Amazon
    4 years late on Smart Speaker and the product was 6 months late
    No movie Streaming even though 4 years ahead of Netflix on renting and streaming a movie
    Airport Express routers left to rot
    Mac mini left to rot
    3 years late on icloud and over priced for storage
    No wireless charging mats for iPhone X even thigh annc 8 months ago
    Dividend lower than average S@P

    His legacy is will be turning Away Apple into IBM slow over priced and directionless with no innovation. Just buying back stock up I juice rh stock price temporarily for the likes of Eddy Cue “we know nothing about TV” SXSW quote 2018

    1. To be fair with the iCloud pricing, Apple doesn’t want to lose money on wrapping up your data and storing it on Amazon. Microsoft or Google’s servers. Apple’s own servers are mainly used for other things.

        1. Not approving, just pointing out tongue-in-cheek that Apple doesn’t relent on their ‘cut’ regardless of if they end up being the middleman. If you think about it iCloud is probably the service with the highest ‘profit’ since very little is done by them in the ‘back’ to eat into their margin outside of encrypting/decrypting your stored data. All management costs of the storage HW are part of the ‘rent’ Apple pays to Amazon, Google, Microsoft.

  7. After all their dirty doings, who gives a rat’s what Deutsche Bank has to say about anything?!

    Deutsche Bank fined for $10 billion Russian money-laundering scheme

    The giant German lender was hit with about $630 million in penalties on Tuesday over a $10 billion Russian money-laundering scheme that involved its Moscow, New York and London branches.

    It follows a $7.2 billion settlement Deutsche Bank reached with the U.S. Department of Justice last month over toxic mortgage assets and the $2.5 billion it agreed to pay in 2015 over interest rate manipulation.

    1. Meanwhile, I believe I’ve thoroughly roasted the Late-To-Market, Promises-Not-Kept HomePod previously, as well as the back benching of Siri compared to both Google Home and Amazon Echo.

      Apple is clearly making improvements to Siri over time. We had a nice session of joke telling last night. But both Google Home and Amazon Echo are now scriptable by users. Siri is only scriptable by developers. Wake up Apple, etc. (o_0)

  8. I think some people on here are missing the point of the article. The miss is coming too late to the party to win he home automation race – and be too expensive. Home automation isn’t like phones or tablets, to achieve scale you’ll need to be the choice of ecosystem for a majority of consumers. Just like iPhone has done. With an inferior voice and Home ecosystem – and at $200 more – why would people choose Apple over Amazon to turn on their lights and heating? This home miss will go down in years to come as TCs biggest error.

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