If You Are Losing the Game, Best to Change the Rules

Ben Thompson for Stratechery:

The long-rumored competitor to Amazon Echo and Google Home was, fascinatingly, framed as anything but. {Tim} Cook began the unveiling by referencing Apple’s longtime focus on music, and indeed, the first several minutes of the HomePod were entirely about its quality as a speaker. It was, in my estimation, an incredibly smart approach: if you are losing the game, as Siri is to Alexa and Google, best to change the rules, and having heard the HomePod, its sound quality is significantly better than the Amazon Echo (and, one can safely assume, Google Home). Moreover, the ability to link multiple HomePods together is bad news for Sonos in particular (the HomePod sounded significantly better than the Sonos Play 3 as well).

Of course, superior sound quality is what you would expect from a significantly more expensive speaker: the HomePod costs $350, while the Sonos Play 3 is $300, and the Amazon Echo is $150. From Apple’s perspective, though, a high price is a feature, not a bug: remember, the company has a hardware-based business model, which means there needs to be room for a meaningful margin.

The result is a product that, beyond being massively late to market, is inferior to the competition on two of three possible vectors: the HomePod is significantly more expensive than an Echo or Google Home, it has an inferior voice assistant, but it has a better speaker. That is not as bad as it sounds: after all, the iPhone is significantly more expensive than most other smartphones, it has inferior built-in services, but it has a superior user experience otherwise. The difference — and this is why the iPhone is so much more dominant than any other Apple product — is that everyone already needs a phone; the only question is which one. It remains to be seen how many people need a truly impressive speaker.

Coming from a music industry POV, an emphasis on sound quality as a feature – as it applies to music playback – is a great move and may even raise the bar for competitors' forthcoming hardware. I look forward to personally assessing just how good this HomePod speaker sounds, and find it fascinating that the HomePod has been successfully positioned so that the sound quality is what I'm mostly curious about.