Announced in June 2017 at Apple’s Developers’ Conference, the HomePod shipped late and incomplete. Last week we looked at the trouble with speakers reviews in general and with the specifics of HomePod adaptive audio. Today, we look at another HomePod challenge: positioning.
HomePod positioning is dead simple: Apple’s latest audio product belongs to the smart speaker category, a space dominated by Amazon and Google. Amazon fields a range of Echo devices starting at $49 and sporting the Alexa voice assistant. Google Home speakers, with the powerful Google Assistant voice interface, also start at $49. Apple’s one and only HomePod costs $349 and features the Siri conversationalist, generally perceived as substantially inferior to Alexa and Google’s Assistant.
Positioning case closed: HomePod costs more, but does less. Late start. Once again, Apple’s offering is dead in the water .
It’s not that simple.
Understanding HomePod’s place in the world, what it actually does and for whom, requires more consideration than the lapidary Costs More, Does Less. I see three problems with HomePod positioning.
First, gravitational pull. “Stars” such as Amazon’s and Google’s smart speakers create a massive category. Any similar product in their vicinity inevitably falls into the gravitational well they’ve created. In less metaphorical terms, Amazon and Google have defined the category; HomePod is evaluated on their terms.
There is a counter maneuver.
I vividly recall a Saturday morning meeting in Cupertino during the bad days of 1985: Steve Jobs was gone; Mac sales were weak; the kommentariat saw inevitable failure because Apple’s new personal computer wasn’t “standard”, which resulted in a lack of support from “serious developers” of business software. Company marketeers were on their heels, looking for a counter-narrative.
A venerable Valley story doctor was brought to the patient’s bedside and, in short order, offered a simple remedy: Position the Mac as a Graphics Based Business System (GBBS). The Business System part was adman puffery meant to project gravitas, but the reference to graphics made unarguable sense: The Mac’s Graphical User Interface (GUI) was clearly a distinguishing factor at the time.
Everyone in the room loved the idea. Rather than take on the whole market, Apple would define and dominate a niche. As the Valley marketing sage put it ( quoting Julius Caesar ), better to be the chief of a small village in the Alps than second-in-command in Rome.
Thanks to Jobs’ vision and powers of seduction, a couple of “serious developers”, Adobe and Aldus , helped transform the GBBS air guitar into a reality. Adobe contributed the PostScript software engine for the LaserWriter’s breakthrough typography and graphics. Aldus came up with the PageMaker program that made exemplary use of the Mac + LaserWriter combo. Aldus Chairman Paul Brainerd coined the term Desktop Publishing (DTP), a phrase that replaced the GBBS straw man and remains to this day. The Mac became #1 in the DTP village.
Back to today: Is there an Alpine hamlet that the HomePod can claim as its own?
Sound quality comes to mind. To Be Sure™, Apple is already a substantial audio products company with its AirPods and its Beats line of headsets, earphones, and portable loudspeakers, products whose total revenue probably outperforms several of the competitors (B&O, Sonos, Bose et al.) it sells in its Apple Stores. Horace Dediu and Ben Bajarin think the HomePod alone will generate about $1B in sales for its first year :
“HomePod appears to [be] another billion dollar business. Move along, nothing to see here.”
(For comparison, Bose , a very serious audio company founded in 1964 — a decade older than Apple — generated $3.8B in sales for 2017. Perhaps Messrs. Dediu, Bajarin or Cybart will extract Apple’s hardware audio business from the prosperous but opaque Other Products category that yielded $8.5B in sales this past Holiday quarter, + 36% year-to-year. This will let us see how big Apple audio really is. My own guess, based on subtracting 8M watches at $500 each, approximately $3B — just for that quarter.)
But as discussed in last week’s Monday Note , sound quality is too subjective and imprecise to provide the kind of vivid differentiation that the Mac’s GUI offered in 1985.
Then there’s Siri . Many of the kommentariat that have faulted Siri’s HomePod performance were unfazed by the same shortcomings on Apple’s AirPods, shortcomings that haven’t dampened customers’ appetite for Apple’s distinctive wireless earphones. Perhaps the size, elegance, and ease of wireless coupling afforded by Apple’s proprietary W1 silicon provided AirPods with a hill on which to stand and look down on their competition.
Apple execs have known about Siri’s weaknesses for a while and once bravely said things like “ Siri has to get better, and will get bette r”. More recently the company took concrete action and moved Siri into Senior VP of Software Engineering Craig Federighi’s domain. The well-respected Federighi (fondly nicknamed Hair Force One) now carries Apple’s hopes for Siri achieving parity or superiority. That would help HomePod positioning and, much more importantly, the entire company.
But is Siri actually an impediment, or a flawed-but-improvable feature? If Siri’s performance were roughly on par with Alexa and Google’s Assistant, the talk of the town would be HomePod’s superb audio quality and the ushering in of a new era of computational audio.
(Speaking of ushering in a new era, a moment of ironic contemplation is warranted. Introduced as a separate iOS app in 2010 and integrated in the iPhone 4S in October 2011, Siri led the way into the voice assistant space. The irony stems from Apple’s frequent boast they don’t feel they have to be first in any given space but, instead, focus on eventually providing the best-in-class product. With Siri, Apple appears to have done the opposite: Siri first out of the gate but now lagging behind Amazon and Google.)
To gain perspective on the HomePod’s positioning problem, let’s look at it through the Job To Be Done (JTBD) lens, a term originally coined by Clayton Christensen . What job is a car supposed to do? Certainly, it takes us from Point A to Point B, but it also provides benefits such as self-presentation, entertainment, moments of privacy.
So what job does the HomePod do, and for whom? Is it just a music player, or is it a more ecumenical home control device, an companion for all kinds of everyday tasks? Is it a bi-directional communication port to the rest of the world?
Here, we have to pause and realize that the answers to the HomePod JTBD question are fragile and incomplete because the product itself is incomplete. The HomePod that ships today lacks important features such as stereo, multi-room audio , and a better version of Apple’s wireless Airplay protocol. Over time, the A8 processor and iOS derivative inside the HomePod are likely to provide substantial improvements and make it very competitive compared to speakers that have less hardware and software muscle. But for today, the HomePod is incomplete and its place in the world unclear.
PS: On February 24th, Steve Jobs would have been 63. I still miss agreeing and disagreeing with him. In a Monday Note titledToo Soon, I salute his life and acknowledge my own debt.