Apple is Planning New HomePod and AirPods for 2019 – Bloomberg
Bloomberg is reporting that Apple is planning a new HomePod and upgraded AirPods for 2019. Apple is also revisiting its relationship with contract manufacturer Inventec after delays in HomePod and AirPod production over the past two years. The company is reportedly shifting more of its business to Foxconn which already is the primary manufacturers of iPhones. Bloomberg’s Mark Gurman reports:
“Apple Inc. is … planning higher-end AirPods, a new HomePod and studio-quality over-ear headphones for as early as next year, according to people familiar with the matter…Inventec executives met with Apple executives in California in recent weeks to discuss future HomePod orders, but a final decision on working with Inventec on the new model hasn’t been made, the people said.”
AirPods Are Key Element of Apple’s Voice Strategy
The new AirPods are likely to include noise cancellation, improved water resistance and may also be able to operate at an increased range away from the user’s iPhone. Future versions may also include biometric sensors such as a heart rate monitor. By all accounts, AirPods have been a big success for Apple. KGI Securities estimates that 13-14 million units shipped in 2017 and that figure will double in 2018. MacRumors quoted a passage from a KGI security report in December that said:
“We believe demand for AirPods has been strong, and note that the shipping time of the product on Apple’s official shopping website has shortened to 1-3 days, mainly thanks to an improved assembly process and increased capacity from Luxshare as the new assembler […] We expect AirPods to remain one of the most popular Apple accessories in 2018, with shipments likely to rise 100% YoY to 26-28mn units next year.”
It is critical that Apple improve Siri to be truly competitive in voice. Great hardware won’t overcome substandard software over the long term. However, beyond Siri, Apple has a powerful set of person-centered assets for voice. The iPhone is used by more than one billion people worldwide. Apple Watch is expanding consumer interaction with the company services, can be used as a connected device without an iPhone and has improved its access to voice interaction. AirPods make voice and audio easily accessible while consumers are on-the-go or anywhere they happen to be. They make voice and audio interaction with Watch and iPhone better. If Siri can be improved, Apple’s person-centered voice access points will be a powerful combination.
A New HomePod?
Apple is much further behind in place-centered voice interaction. Device manufacturers are not allowed to incorporate Siri into non-Apple products. That means the HomePod is the only way for Apple to expand its place-centered consumer access points for Siri. And, the HomePod received a fairly tepid market reaction. Several reports suggested HomePod had superior sound quality than other smart speakers, but others said it was inferior to Sonos One and Google Home Max. Everyone agreed that Siri and the limited number of device integrations were a drawback.
This has led to stories about unsold inventory and lackluster sales. A survey conducted by Voicebot and Voysis in May revealed that Apple had climbed to 4.1% market share among U.S. adults. In some ways it is not a bad result after being in market for just four months. However, it is not exactly where Apple needs to be for Siri to become ubiquitously available. It is also hard to see how HomePod will even maintain that market share given the price point and momentum behind the Google Home and Amazon Echo product lines.
In order to significantly increase market share, Apple will need to take three steps. First, it needs to improve Siri as stated above. Second, it needs to enable some third-party integrations to add more value to the Siri ecosystem. Third, it needs a lower priced HomePod option in the market. The last point has been the subject of speculation that a sub $200 HomePod may arrive in late 2018. It is not clear if the Bloomberg reporting is the logical continuation of this rumor, but it suggests the earlier speculation may have merit. Smart speakers and place-centered voice interaction should be an important part of Apple’s voice strategy even if it biases toward person-centered voice solutions.
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