Smart speaker market growing steadily but dominated by sub-$50 models

Posted:
in General Discussion
A new report by CIRP shows that price seems to be the driving factor behind smart speaker adoption and market growth, with over 50 percent of the market belonging to entry-level Amazon Echo and Google Dot and Mini devices.

Apple HomePod


According to Consumer Intelligence Research Partners, the U.S. installed base of smart speakers is now 76 million units, up from 70 million units in the March 2019 quarter, and 50 million in June 2018 quarter.

Amazon Echo currently accounts for 70 percent of the speakers with Google Home accounting for 25 percent. The Apple HomePod accounts for the final 5 percent.

The smart speaker market is growing, and while it still accounts for the smallest share, Apple's HomePod has seen growth in the market.


"While the biggest growth in the market for smart speakers is in the holiday fourth quarter, Amazon Echo and Google Home continues to grow their installed bases in the past couple of quarters," said Josh Lowitz, Partner and Co-Founder of CIRP.

Pricing is likely the driving factor behind adoption


According to the report, the market has grown by 9 percent in the second quarter and over 50 percent year-over-year. All three major producers have maintained steady shares of the market and the competitive pricing of entry-level models drive new customers to try smart speakers.

But, as pointed out by CIRP, more than half of the existing market is at the cheapest entry point for the devices, around the $50 mark.

Apple's HomePod has had a permanent price reduction, following the original launch. The $299 price tag still means it's likely a less attractive option than both Google and Amazon's entry level speakers.

Occasional rumors have suggested that Apple may be working on a lower-cost HomePod, but there have been no iterations of the rumors as of late.
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Comments

  • Reply 1 of 30
    seanismorrisseanismorris Posts: 1,015member
    I’d have expected Apple to release a lower priced model by now...

    I’m thinking $149 with discount into the $129 range.

    Available by Christmas?

    If Apple wants to grow services (Apple Music) they need to target more price points...
    donjuan
  • Reply 2 of 30
    AppleExposedAppleExposed Posts: 1,376unconfirmed, member
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    cornchipforegoneconclusionStrangeDays
  • Reply 3 of 30
    gatorguygatorguy Posts: 20,894member
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    So you think this is one of those one-off "fun" projects that was never intended on its own to be a competitive success? Serious question. You wouldn't be the first person to hold that opinion, tho Apple did go to a lot of effort in initially promoting it. 
    edited August 8 AppleExposedrevenantmuthuk_vanalingam
  • Reply 4 of 30
    cornchipcornchip Posts: 1,361member
    gatorguy said:
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    So you think this is one of those one-off "fun" projects that was never intended on its own to be a competitive success? Serious question. You wouldn't be the first person to hold that opinion, tho Apple did go to a lot of effort in initially promoting it. 

    Just guessing, but I think he might have meant Apple never intended to compete in the $50 end of the connected speaker market. I would agree. Just like Apple never intended to compete in the low-end computer, phone, tablet, ("smart") watch markets. While iPods did get fairly affordable over time, they were still more expensive than most competitors that arrived. As we all know, Apple mostly doesn't give a rip about market share but revenue per unit. Can they sell enough to recoup the cost of investment (including man hours) and then enough to invest in the next gen/variants? Then great. If not, it'll get axed.

    I have a feeling HP will slowly to catch on. I know I'm chomping at the bit for a couple, but financially, I'm a couple years out. And that's fine with me, I'd rather pay a fair price for something high-quality than fifty bucks for a piece of junk. But that's just me.

    PS I can totally see Apple going the iPhone route and continue selling the previous model when the new gen comes out. Boom there's your lower cost option.
    StrangeDaysn2itivguywatto_cobra
  • Reply 5 of 30
    jcs2305jcs2305 Posts: 787member
    gatorguy said:
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    So you think this is one of those one-off "fun" projects that was never intended on its own to be a competitive success? Serious question. You wouldn't be the first person to hold that opinion, tho Apple did go to a lot of effort in initially promoting it. 
    I am thinking the OP meant Apple never intended to compete in the Sub $50.00 market. Not that Homepod is a one off "fun" project.. although I could be wrong that is how I took it.
    cornchipAppleExposedtmayStrangeDayswatto_cobra
  • Reply 6 of 30
    davgregdavgreg Posts: 421member
    Apple really missed the boat with the toilet paper roll in fishnets- must be the same person who suggested the trashcan Mac Pro.

    The Amazon Dot may have a tiny speaker but can be connected to a nice audio system of your choosing. Why listen to a crappy little Apple HomePod when you have serious money invested in an audio system?

    I have a nice system set up in my home complete with Focal speakers and there is not a "smart speaker" at any price that will come near it in sound quality. I can easily add an Amazon Dot and make the thing a "smart speaker", but Apple chose not to give users that option.

    I can already push music to that system via Bluetooth by having added an Audioengine BT module and connecting it with an optical audio link. I can stream music from my Apple TV, my Mac, my iPad Pro or my iPhone to that unit. That is a much more attractive option than the grossly overpriced HomePod.

    The HomePod is a flop. Go into any Apple retail store and the least attended thing inside is that crappy little speaker. It is too expensive for teens and too cheesy and low quality for adults.
  • Reply 7 of 30
    davgregdavgreg Posts: 421member
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    Apple is in the business of making money and increasingly through an integrated system of interlinked devices. The HomePod figures in Apple's strategy for HomeKit, Apple Music and other services. As a tentpole in the strategy, it has failed miserably.

    I would venture a guess that the overwhelming majority of AppleInsider subscribers/readers do not own or plan to buy one. I would further guess that more than a few have an Amazon device- quite possibly a Dot - in their home.
    rogifan_new
  • Reply 8 of 30
    AppleExposedAppleExposed Posts: 1,376unconfirmed, member
    What I meant is, Apple just wanted to make a kick-ass speaker with Siri thrown in. There's a lot of evidence showing Apple was developing Homepod long before Alexa and it's obvious considering the amount of development and refinement.

    Apple never meant to make a cheap speaker that sits on your counter ready for cooking recipes or to sell you crap.

    A better comparison would be Bluetooth speakers in general not echo dots that are handed out for free.
    watto_cobra
  • Reply 9 of 30
    thedbathedba Posts: 478member
    davgreg said:
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    Apple is in the business of making money and increasingly through an integrated system of interlinked devices. The HomePod figures in Apple's strategy for HomeKit, Apple Music and other services. As a tentpole in the strategy, it has failed miserably.

    I would venture a guess that the overwhelming majority of AppleInsider subscribers/readers do not own or plan to buy one. I would further guess that more than a few have an Amazon device- quite possibly a Dot - in their home.
    I’m one AppleInsider subscriber and I do own a HomePod. 
    I can tell you with certainty that I’ve heard both the Google home mini and the Echo dot and they both sound like crap, compared to HomePod. 
    So the price IMO is well warranted, if listening to music or paired to your appleTV are your primary uses. 

    StrangeDayswatto_cobra
  • Reply 10 of 30
    rogifan_newrogifan_new Posts: 4,146member
    cornchip said:
    gatorguy said:
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    So you think this is one of those one-off "fun" projects that was never intended on its own to be a competitive success? Serious question. You wouldn't be the first person to hold that opinion, tho Apple did go to a lot of effort in initially promoting it. 

    Just guessing, but I think he might have meant Apple never intended to compete in the $50 end of the connected speaker market. I would agree. Just like Apple never intended to compete in the low-end computer, phone, tablet, ("smart") watch markets. While iPods did get fairly affordable over time, they were still more expensive than most competitors that arrived. As we all know, Apple mostly doesn't give a rip about market share but revenue per unit. Can they sell enough to recoup the cost of investment (including man hours) and then enough to invest in the next gen/variants? Then great. If not, it'll get axed.

    I have a feeling HP will slowly to catch on. I know I'm chomping at the bit for a couple, but financially, I'm a couple years out. And that's fine with me, I'd rather pay a fair price for something high-quality than fifty bucks for a piece of junk. But that's just me.

    PS I can totally see Apple going the iPhone route and continue selling the previous model when the new gen comes out. Boom there's your lower cost option.
    This is complete bullshit. Of course Apple cares about market share. You don’t have an ecosystem and can’t sell services on top of it if you don’t have market share. Apple sells millions of Macs, iPads and Apple Watches each quarter. Are you telling me the wouldn’t love it if they were selling millions of HomePods too? Tim Cook doesn’t even mention it on earnings calls. I think it’s pretty clear the product is a failure. Mostly because Apple went after what people weren’t asking for. People that want a smart speaker care about price more than audio quality and people who care about audio quality have something better than HomePod. If Apple really is focused on sound quality and not voice then why not make a really great sound bar or home theater system? I would never replace my sound bar with a HomePod but if Apple made a superior sound bar I just might.
    gatorguymuthuk_vanalingam
  • Reply 11 of 30
    mobirdmobird Posts: 220member
    Yeah, it appears that Apple somehow misread the market regarding the HomePods and that is a disappointment, but I don't find them crappy at all and I am sure there are many Apple devotees that would find great pleasure owning the HomePod/s if the pricing wasn't so prohibitive as well as not deploying the real and intrusive crap from Amazon and Google. I find a stereo pair of HomePods sound great on the back patio. No they can not compete with my KEF Reference 107's but it does give me appreciation for what the HomePods are capable of.
    Now excuse me please as I "retreat to my dedicated listening room while enjoying a snifter of cognac". NOT;) 

  • Reply 12 of 30
    flydogflydog Posts: 328member
    cornchip said:
    gatorguy said:
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    So you think this is one of those one-off "fun" projects that was never intended on its own to be a competitive success? Serious question. You wouldn't be the first person to hold that opinion, tho Apple did go to a lot of effort in initially promoting it. 

    Just guessing, but I think he might have meant Apple never intended to compete in the $50 end of the connected speaker market. I would agree. Just like Apple never intended to compete in the low-end computer, phone, tablet, ("smart") watch markets. While iPods did get fairly affordable over time, they were still more expensive than most competitors that arrived. As we all know, Apple mostly doesn't give a rip about market share but revenue per unit. Can they sell enough to recoup the cost of investment (including man hours) and then enough to invest in the next gen/variants? Then great. If not, it'll get axed.

    I have a feeling HP will slowly to catch on. I know I'm chomping at the bit for a couple, but financially, I'm a couple years out. And that's fine with me, I'd rather pay a fair price for something high-quality than fifty bucks for a piece of junk. But that's just me.

    PS I can totally see Apple going the iPhone route and continue selling the previous model when the new gen comes out. Boom there's your lower cost option.
    This is complete bullshit. Of course Apple cares about market share. You don’t have an ecosystem and can’t sell services on top of it if you don’t have market share. Apple sells millions of Macs, iPads and Apple Watches each quarter. Are you telling me the wouldn’t love it if they were selling millions of HomePods too? Tim Cook doesn’t even mention it on earnings calls. I think it’s pretty clear the product is a failure. Mostly because Apple went after what people weren’t asking for. People that want a smart speaker care about price more than audio quality and people who care about audio quality have something better than HomePod. If Apple really is focused on sound quality and not voice then why not make a really great sound bar or home theater system? I would never replace my sound bar with a HomePod but if Apple made a superior sound bar I just might.

    You have zero knowledge of how many HomePods Apple has sold or how much profit it has earned on them, yet you feel qualified enough on the subject to opine that "the product is a failure" simply because some third-party research firm (who is just as ignorant) declared that the HomePod has small market share of a market composed primarily of sub-$50 knockoffs.

    Ok. 
    edited August 8 pscooter63StrangeDayswatto_cobra
  • Reply 13 of 30
    flydogflydog Posts: 328member
    thedba said:
    davgreg said:
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    Apple is in the business of making money and increasingly through an integrated system of interlinked devices. The HomePod figures in Apple's strategy for HomeKit, Apple Music and other services. As a tentpole in the strategy, it has failed miserably.

    I would venture a guess that the overwhelming majority of AppleInsider subscribers/readers do not own or plan to buy one. I would further guess that more than a few have an Amazon device- quite possibly a Dot - in their home.
    I’m one AppleInsider subscriber and I do own a HomePod. 
    I can tell you with certainty that I’ve heard both the Google home mini and the Echo dot and they both sound like crap, compared to HomePod. 
    So the price IMO is well warranted, if listening to music or paired to your appleTV are your primary uses. 

    Someone who gets it. 
    StrangeDayswatto_cobra
  • Reply 14 of 30
    IreneWIreneW Posts: 164member
    flydog said:
    cornchip said:
    gatorguy said:
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    So you think this is one of those one-off "fun" projects that was never intended on its own to be a competitive success? Serious question. You wouldn't be the first person to hold that opinion, tho Apple did go to a lot of effort in initially promoting it. 

    Just guessing, but I think he might have meant Apple never intended to compete in the $50 end of the connected speaker market. I would agree. Just like Apple never intended to compete in the low-end computer, phone, tablet, ("smart") watch markets. While iPods did get fairly affordable over time, they were still more expensive than most competitors that arrived. As we all know, Apple mostly doesn't give a rip about market share but revenue per unit. Can they sell enough to recoup the cost of investment (including man hours) and then enough to invest in the next gen/variants? Then great. If not, it'll get axed.

    I have a feeling HP will slowly to catch on. I know I'm chomping at the bit for a couple, but financially, I'm a couple years out. And that's fine with me, I'd rather pay a fair price for something high-quality than fifty bucks for a piece of junk. But that's just me.

    PS I can totally see Apple going the iPhone route and continue selling the previous model when the new gen comes out. Boom there's your lower cost option.
    This is complete bullshit. Of course Apple cares about market share. You don’t have an ecosystem and can’t sell services on top of it if you don’t have market share. Apple sells millions of Macs, iPads and Apple Watches each quarter. Are you telling me the wouldn’t love it if they were selling millions of HomePods too? Tim Cook doesn’t even mention it on earnings calls. I think it’s pretty clear the product is a failure. Mostly because Apple went after what people weren’t asking for. People that want a smart speaker care about price more than audio quality and people who care about audio quality have something better than HomePod. If Apple really is focused on sound quality and not voice then why not make a really great sound bar or home theater system? I would never replace my sound bar with a HomePod but if Apple made a superior sound bar I just might.

    You have zero knowledge of how many HomePods Apple has sold or how much profit it has earned on them, yet you feel qualified enough on the subject to opine that "the product is a failure" simply because some third-party research firm (who is just as ignorant) declared that the HomePod has small market share of a market composed primarily of sub-$50 knockoffs.

    Ok. 
    Knockoffs? Care to elaborate? Who is copying who?
    Carnagemuthuk_vanalingam
  • Reply 15 of 30
    HomePod is a very sophisticated device, playing music with a very high tonal quality.  I tend to listen to music as a pastime, rather than having a jangly noise in the background.  Consequently, I pay more for sound reproduction equipment.  To that end, HomePod is not expensive when taking into account its quality in every respect.  Ultimately, you get what you pay for.  I suspect most people buy the cheap devices for what it provides, other than music, so the requirement is different. 
    mobirdStrangeDaysn2itivguywatto_cobra
  • Reply 16 of 30
    Rayz2016Rayz2016 Posts: 4,716member
    davgreg said:
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    Apple is in the business of making money and increasingly through an integrated system of interlinked devices. The HomePod figures in Apple's strategy for HomeKit, Apple Music and other services. As a tentpole in the strategy, it has failed miserably.

    I would venture a guess that the overwhelming majority of AppleInsider subscribers/readers do not own or plan to buy one. I would further guess that more than a few have an Amazon device- quite possibly a Dot - in their home.
    I would go further and say that the most vocal AI readers don’t own any Apple kit whatsoever, which is why only an idiot would measure the success of a product by the number of people on a web forum who say they won’t buy it. 

    StrangeDayswatto_cobra
  • Reply 17 of 30
    Rayz2016Rayz2016 Posts: 4,716member

    cornchip said:
    gatorguy said:
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    So you think this is one of those one-off "fun" projects that was never intended on its own to be a competitive success? Serious question. You wouldn't be the first person to hold that opinion, tho Apple did go to a lot of effort in initially promoting it. 

    Just guessing, but I think he might have meant Apple never intended to compete in the $50 end of the connected speaker market. I would agree. Just like Apple never intended to compete in the low-end computer, phone, tablet, ("smart") watch markets. While iPods did get fairly affordable over time, they were still more expensive than most competitors that arrived. As we all know, Apple mostly doesn't give a rip about market share but revenue per unit. Can they sell enough to recoup the cost of investment (including man hours) and then enough to invest in the next gen/variants? Then great. If not, it'll get axed.

    I have a feeling HP will slowly to catch on. I know I'm chomping at the bit for a couple, but financially, I'm a couple years out. And that's fine with me, I'd rather pay a fair price for something high-quality than fifty bucks for a piece of junk. But that's just me.

    PS I can totally see Apple going the iPhone route and continue selling the previous model when the new gen comes out. Boom there's your lower cost option.
    This is complete bullshit. Of course Apple cares about market share. You don’t have an ecosystem and can’t sell services on top of it if you don’t have market share. Apple sells millions of Macs, iPads and Apple Watches each quarter. Are you telling me the wouldn’t love it if they were selling millions of HomePods too? Tim Cook doesn’t even mention it on earnings calls. I think it’s pretty clear the product is a failure. Mostly because Apple went after what people weren’t asking for. People that want a smart speaker care about price more than audio quality and people who care about audio quality have something better than HomePod. If Apple really is focused on sound quality and not voice then why not make a really great sound bar or home theater system? I would never replace my sound bar with a HomePod but if Apple made a superior sound bar I just might.
    Ah, bringing the narrow viewpoint to the table yet again. No matter how many times it’s explained to you, you still don’t get it. 

    Apple doesn’t care about market share. It cares about profit share, which translates to grabbing the largest share of the most valuable customers and holding on to them. It does not care about grabbing the biggest share of people who don’t want to pay for anything, and the HomePod reflects that. 

    They don’t make cheap products because they’re not interested in cheap customers and razor-thin margins. 

    Apple could easily sell millions more HomePods, by knocking the price down to $20. Would that bring more people to the Apple ecosystem? Of course not! Because the people who only want to pay $20 for a smart speaker are unlikely to pay monthly for the wedge of subscriptions that Apple wants to sell them. 

    Why doesn’t Apple make a home theatre system? For the Sam reason Apple doesn’t get into televisions: a crowded field with razor thin margins. 

    Look at Spotify. Huge market share, but how much money are they making?

    StrangeDaysmacxpresswatto_cobra
  • Reply 18 of 30
    Rayz2016Rayz2016 Posts: 4,716member

    flydog said:
    thedba said:
    davgreg said:
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    Apple is in the business of making money and increasingly through an integrated system of interlinked devices. The HomePod figures in Apple's strategy for HomeKit, Apple Music and other services. As a tentpole in the strategy, it has failed miserably.

    I would venture a guess that the overwhelming majority of AppleInsider subscribers/readers do not own or plan to buy one. I would further guess that more than a few have an Amazon device- quite possibly a Dot - in their home.
    I’m one AppleInsider subscriber and I do own a HomePod. 
    I can tell you with certainty that I’ve heard both the Google home mini and the Echo dot and they both sound like crap, compared to HomePod. 
    So the price IMO is well warranted, if listening to music or paired to your appleTV are your primary uses. 

    Someone who gets it. 
    One of the very very few. 
    watto_cobra
  • Reply 19 of 30
    Rayz2016Rayz2016 Posts: 4,716member

    gatorguy said:
    There's no evidence that Apple ever intended to compete in this market so I find these articles ridiculous.
    So you think this is one of those one-off "fun" projects that was never intended on its own to be a competitive success? Serious question. You wouldn't be the first person to hold that opinion, tho Apple did go to a lot of effort in initially promoting it. 

    He’s right: Apple never intended to compete in the $50 speaker market.

    They intended to dominate the $400+ market. 

    Before this can happen, they need the HomePod to allow for family use. 
    edited August 9 StrangeDayswatto_cobra
  • Reply 20 of 30
    dewmedewme Posts: 2,121member
    So you're saying that Amazon's low cost-cost Echo devices, which are routinely sold at near 50% discounts over their already much lower prices, are selling more total units than Apple's premium device that rarely sees price drops (and nothing remotely close to half price)? Shocking! 
    StrangeDayswatto_cobra
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