Short Story: The Truth About Apple, Sales Off – TheTradersWire

Short Story: The Truth About Apple, Sales Off

Short Story: The Truth About Apple, Sales Off

By Donna Fuscaldo | April 12, 2018 — 9:39 AM EDT

Apple Inc.’s (AAPL) entrance into the voice-activated smart speaker market appears to be slow, with the company slashing sales forecasts and reducing orders with at least one manufacturer.

The Cupertino, California-based iPhone maker has reduced the orders it placed with Inventec, one of the smart speaker’s manufacturers and has been lowering its internal sales forecasts, according to a Bloomberg report, citing people familiar with the matter. The HomePod, which launched in January is priced at $349.99, about $200 more than Amazon.com Inc.’s (AMZN) line of Echo speakers powered by its popular Alexa voice-activated digital assistant. (See more: Apple’s ‘Other’ Sales to Hit $22B in 2019: Analyst.)

Market data firm Slice Intelligence told Bloomberg pre-orders for the HomePod were strong. In late January, it accounted for roughly one-third of the smart speaker unit sales in the U.S. Once the HomePod arrived on store shelves, sales started to decline. Apple Store workers told Bloomberg inventory of the speaker is accumulating with one store selling less than ten per day. “Even when people had the ability to hear these things, it still didn’t give Apple another spike,” Ken Cassar, Slice principal analyst was quoted as saying in the Bloomberg article. The market research firm found that during the first ten weeks of sales, the HomePod controlled 10% of the market. That compared to Amazon’s 73% market share and Google Home’s 14% share.  (See more: Google Vs. Amazon in Indian Smart-Speaker Showdown.)

For Apple, the HomePod was expected to be the path into the smart home market. Many thought the speaker would act as the a for new voice-activated and Internet-ready devices. Internally, however, the company viewed it more as a high-end speaker, focusing on sound quality rather than Siri’s capabilities. People who worked on the device at Apple told Bloomberg that the company never viewed HomePod as more than an accessory even as the Echo device grew in popularity.

What’s more, lots of consumers who purchased the speaker found it to be heavily reliant on the iPhone and lacking many voice activated features. For instance, consumers thought the HomePod would answer questions and place internet orders like the Echo and Google Home but it mainly played iTunes songs and controlled a handful of smart appliances. It can send messages via an iPhone but Siri isn’t as robust as Alexa on that device. Add the hefty price to the mix and Shannon Cross, a long time Apple analyst ,told Bloomberg there’s little incentive for consumers to spend money on it. It didn’t help that the HomePod missed its December rollout, which meant it couldn’t take advantage of holiday season sales.

Published at Thu, 12 Apr 2018 13:39:00 +0000

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