HomePod Needs to Stand Out Amid Evolving Voice-Controlled Speaker Market, Says NPD

Due to Apple’s late entry into the voice-controlled speaker category, “it’s vital that HomePod provide a differentiated experience” from the growing field of competitors, said NPD analyst Ben Arnold in a blog post. Apple is counting on a more robust Siri to be one distinction of HomePod, said Arnold, citing Siri artificial intelligence that's expected to be able to analyze multiple streams of user data and past app and device usage to make better informed recommendations. Apple’s expansion of voice control to note dictation in Evernote and VoIP calling via Siri are signs Apple is looking for ways to expand the ecosystem, he said. An improved Siri that’s more tightly integrated into iOS and HomePod “is likely to get iPhone and iPad devotees interested,” he said. But numerous challenges face HomePod, especially at a $349 price that’s twice those of Google Home and Amazon’s Echo, “making it unlikely consumers will buy multiples to position throughout the house,” Arnold said. And simulating a Sonos-like multiroom experience “would be equally cost prohibitive,” he said. Early reports indicate HomePod delivers on sound quality, said the analyst, while noting “Apple isn’t a pedigreed audio brand.” The $300-plus segment of the wireless speaker market accounts for only 12 percent of revenues, and total category revenue has declined 3 percent year to date, Arnold said. While the HomePod is still several months out, new products such as Amazon’s Echo Show and Look are signs the market “is already looking beyond the tabletop speaker,” he said.