Ming-Chi Kuo Says Apple Considering Lower-Priced HomePod After Potentially Lackluster Sales

[MacRumors]

HomePod shipments "could be far below market expectations" this year, according to reputable KGI Securities analyst Ming-Chi Kuo.

"Our understanding is that the market expects HomePod shipments to arrive at 5-10 million units in the 2018 fiscal year, versus our forecast of only 2.0-2.5 million units," wrote Kuo, in a research note obtained by MacRumors.

Kuo believes the "major miss" in HomePod shipments could be attributable to the speaker's design and pricing, among other factors.

For starters, at $349, he said the HomePod's high price "could undermine demand despite excellent sound quality." He added that Siri provides an "uninspiring user experience" compared to competitors, presumably including the Amazon Echo with Alexa and the Google Home with Google Assistant.

Kuo said the HomePod's potentially lackluster sales highlights "underlying concerns" in Apple's development of artificial intelligence.

It's been six years since Apple introduced Siri to the market, which was way ahead of the firm's major competitors. The massive population of iOS and macOS users is also conducive to the promotion of the voice assistant function. However, we note that for most users worldwide, Siri is not a must-have function, and Apple has not yet become a leading brand in the AI voice assistant market. We also note that HomePod has not added support for new languages in the device since launch, suggesting Apple is facing challenges in AI/voice assistant development spanning the globe; this will cap the shipments momentum of HomePod.

The oft-accurate analyst said Apple is "mulling" a "low-cost version" of the HomePod that may help short-term shipments. However, even if the product materializes, he predicts it will only provide a short-term boost to sales.

More importantly, Kuo believes Apple needs to improve Siri, support more languages, and make other improvements to the HomePod to stay competitive against Amazon and Google in the smart speaker market. Premium audio quality alone may not be enough for customers to justify dropping $349 on the speaker.

Kuo's research on potentially lower-than-expected HomePod shipments echoes similar reports from Bloomberg News and the China Times earlier this week. Rumors about a lower-priced HomePod have also surfaced a few times in recent months, with one report suggesting a $150-$200 price in the United States.

Apple released the HomePod in early February in the United States, United Kingdom, and Australia, and it also confirmed availability in France and Germany later this spring. AirPlay 2 features such as stereo sound and multi-room audio won't be available until later this year, according to Apple.

Article Link: Ming-Chi Kuo Says Apple Considering Lower-Priced HomePod After Potentially Lackluster Sales

 

[ButteryScrollin]

I would buy a HomePod if it would integrate with AppleTV. no more hunting for the remote and holding down the Siri button.

 

[asdavis10]

HomePod is appropriately priced IF:

1. Siri gets smarter.
2. Device is feature complete.
3. Can be used with third-party streaming services.

OR

4. People don’t care about Siri’s smarts (or lack thereof) and only use Apple Music.

 

[Andres Cantu]

Too late to market had a huge impact on sales also.

 

[jkdsteve]

Siri is pretty much brain dead for most things but does a great job of playing music but I want to ask Siri to play music from a device to a device etc. This is basic stuff..can't be done currently.


I wouldn't be averse to a price cut on the current HomePod so I could have two....Apple rarely does that unless there's a product above it though.

Where's Airplay2 and Stereo Pairing? Another miss by Apple so far...,,chances are they discovered it's harder than they thought, is one of the things SONOS spent a long time perfecting.

 

[JediZenMaster]

I hope not because margins are everything and let’s keep it working with Apple stuff only.

If you open up HomePod to google music then you mine as well license Mac OS to third party’s.

 

[Namji]

Alexa owns the home assistance AI...

 

[Corrode]

If they did this AND their multi-room ends up working well, I’ll sell my Sonos and buy a HomePod and three minis. $349 is just too much when you’re buying for the whole house.

 

[JonnyBlaze]

Needs Spotify connect, then I might be tempted.

 

[ugahairydawgs]

The lower price would have my family buying in. I don't really listen to a ton of music, so all of the Apple Music-centric-ness of it is really lost on me.

I do use Siri a ton though, so the expense becomes a little more justifiable if they 1.) can iron out the device transition issues 2.) figure out the multi-user awkwardness and 3.) drop the price at least in half.

 

[lobbyist]

Honest question from someone who never uses Siri: is it really that bad? I mean is it so bad that it won’t understand basic, everyday commands? What so wrong with it?

 

[sman789]

There's too many lower priced alternatives. If Apple comes out with a slick looking HomePod for $100 they could make a killing.

 

[trichardlin]

> Apple Considering Lower-Priced HomePod After Potentially Lackluster Sales

Uh, we have that already. It's called Amazon Echo and Google Home. Focus on building a better Siri and people will buy more. Apple should never compete on price because that's not why people buy Apple products.

 

[Bacillus]

My (negative) valuation of Siri is that Apple should pay us for its use
Remember, we provide Apple with (collective, anonymized) data that it can legally sell - so we customers are the product !

 

[ApostolisApo]

but some apologists said that HomePod is like Apple Watch and people can not take just some sales numbers out of context...

 

[PotatoLeekSoup]

The first iPhone price drop was the only time I can recall. I cannot imagine Apple dropping the price on HomePod though. AirPlay 2 will also make this more appealing. Adds stereo sound. Multi-room playback. Multi-device control concurrently. But yeah, Siri is still crappy.

 

[JediZenMaster]

Alexa owns the home assistance AI...

How about them privacy issues though? Let’s look at how Amazon and Apple and Google handle privacy.

Can’t put a price on that.

 

[NinjaHERO]

Should have combined it with Apple TV. That would help justify the higher price. And Apple TV is very useful even if you're not totally into the Homepod features. You'd buy the Homepod for AppleTV and learn to love the Pod. Assuming Siri gets better at what she does. lol

 

[jadot]

A smaller $150 'brain' still isn't going to interest consumers if the brain isn't as smart as the competition.
I'd say that consumers don't want the speaker because of the walled garden approach, and Siri's blatant not-as-smart-as-google/alexa problem.

Apple are way behind the curve here. Any user can have an equal or better sounding home assistant speaker setup for less money using either google's or amazon's more intelligent AI and hardware that can fit into their current speaker system.

A cheaper (but still not as cheap as the competition) voice led assistant from Apple, is still a poor quality rival next to say, Alexa and a couple of Sonos Ones.

There's just no reality distortion field here that is gonna do it for Apple this time.

 

[Kadang]

If the HomePod at least WAS available in my country (Denmark) - I would buy one more.

I've already bought one during a vacation trip to the UK, and pretty happy with it.

Excellent music quality, and great sound for my ATV4 - and working with my HUE lights.

Price was... okay, considered being an apple product.

Siri is, of course lacking, and I have to speak English to it - otherwise excellent product.

BUT - Extend the markets, and expand the Siri areas to other countries (and knowledge & AI)


Siri in danish is working on my iPhone - limited but working in danish compared to US/UK - So why the HomePod can't at least understand some danish - Stupid, limiting decisions.

 

[iapplelove]

Instead of a “lower priced HomePod” why not just lower the price of the HomePod ?

 

[69Mustang]

I hope not because margins are everything and let’s keep it working with Apple stuff only.

If you open up HomePod to google music then you mine as well license Mac OS to third party’s.

This is a really bad lukewarm taek. Apple Music is already on Google's platform. iTunes is all over MS' platform. The HomePod is a speaker. If Apple wants it to sell well, it should be accessible to as many devices and ecosystems as possible. If Apple wants it to be an additional binding element in their ecosytem, they can just continue doing as they are now.

Just so you know, you can Airplay Google Play Music on a HomePod. So there's that.

 

[dwaltwhit]

The first iPhone price drop was the only time I can recall. I cannot imagine Apple dropping the price on HomePod though. AirPlay 2 will also make this more appealing. Adds stereo sound. Multi-room playback. Multi-device control concurrently. But yeah, Siri is still crappy.

They might drop the cost $50 but add another device at a lower cost

 

[unobtainium]

I’m not buying a speaker that doesn’t support Spotify Connect. I don’t like the music discovery options on Apple Music and I’m not willing to switch.

 

[blacktape242]

will never happen, and i dont think lowering the price will help.