What’s right and wrong with HomePod

In a four-way race to own the smart home, Ben Thompson puts Apple in third place.

Thompson weighs the strengths and weaknesses of four contenders—Amazon, Google, Apple and Facebook—in The Battle for the Home, posted Wednesday on Stratechery.

Here’s his take on the HomePod:

Apple’s strengths:

The HomePod is exactly what you would expect from Apple: the best hardware at the highest price. The sound is excellent and, naturally, even better if you buy two. The HomePod is also — again, as you would expect from Apple — locked into the Apple ecosystem; this is from one perspective a weakness, but this is the Strength section, and the reality is that people are more committed to their iPhones — and thus Apple’s ecosystem — than they are to home speakers, meaning that for many customers this limitation is a strength.

Along those lines, Apple is clearly the most attractive option from a privacy perspective: the company doesn’t sell ads, has made privacy a public priority, and is thus the only choice for those nervous about having an Internet-connected microphone in their house.

Apple’s weaknesses:

Apple, even more than Google, seemed blinded by its smartphone success. This isn’t a surprise: the ultimate point of Android was to be a conduit to Google’s services; it follows, then, that if home devices are about services, that Google would be more attuned to the opportunity (and the threat). Apple, on the other hand, is and always will be a product company; the company offers services to help sell its hardware, not the other way around, and it follows that the company would be heavily incentivized to insist that the iPhone and Apple Watch, which both offered attractive hardware margins and were differentiated by the integration of hardware and software, were better home devices.

That, furthermore, explains Apple’s biggest weakness: the relative performance of Siri as compared to Alexa or Google Assistant. The problem isn’t a matter of trivia, but rather speed and reliability. Siri is consistently slower and more likely to make mistakes in transcription than either Alexa or Google Assistant (and, for the record, more likely to fail trivia questions as well). As always, Apple is the most potent example of how strengths equal weaknesses: just as it was inevitable that a services company like Amazon would be poor at product, a truly extraordinary product company like Apple will face fundamental challenges in services.

My take: The Battle for the Home is a must-read for anyone following the race. As is, for anyone following Apple, Apple’s Organizational Crossroads, the essay to which Thompson points at the end.

9 Comments

  1. John Kirk said:

    Whenever someone says “A is ahead of B,” I ask, “in what race are they running, and is it the right race?” Because you can be far “ahead” but if you’re in the wrong race, then every step takes you further from your goal.

    Lots of companies have been “ahead” of Apple, but they were often running in the wrong race. Microsoft lead in computerized television — which ended up being a dead end. Lots of MP3 players were “ahead” of Apple — until Apple introduced the iPod and showed them how it was done. Microsoft had a tablet in 2001. Apple didn’t introduce the iPad until 10 years later. Was Apple 10 years behind in tablets? No. Apple didn’t enter the race until all the pieces for a competent tablet were in place. Everybody and his brother had a phone before Apple did. Where are they now? Palm. Gone. Microsoft Mobile. Gone. Nokia. Gone. Blackberry (RIM). Gone.

    So why the rant about races? Well, I’m not at all sure if the race that’s currently being run is the right race. And if it’s not, then being “ahead” doesn’t much matter. The current race is the race for homebound boxes that listen and respond to your commands. But is that really a viable endgame? Wouldn’t you rather be in the position of having a box in your pocket that you carried with you everywhere and had available at all times? A box like, say, the iPhone?

    I’m not smart enough to know what race Amazon, Google, and Apple should be running in. But I’m cynical enough to question whether boxes like those being put forward by Amazon and Google are really the way to go. I suspect not.

    6
    October 11, 2018
    • Richard Wanderman said:

      You nailed it. With the iPhone and Apple Watch, Apple has listening ability at all times in all rooms and outside the house.

      And, let’s not forget Apple TV which, whether people use it or not, responds to voice although I’m now controlling mine from my Apple Watch via Siri. Works like a charm.

      1
      October 11, 2018
    • Fred Stein said:

      Thanks for taking a stand on the race metaphor. As investors, we need to ask; 1) Does Apple serve its customers well; 2) Can they add more customers and add more products and services to those customers over time? The answer to both is yes.

      Sure Apple misses a lot, but is part of their discipline to be highly selective.

      That said, Siri is the counter example. Apple was the first mover. The followers have done much better. We’ll have to wait a while to see what Giannandrea can do. This is Apple’s biggest challenge.

      0
      October 11, 2018
      • David Drinkwater said:

        In terms of voice recognition, I think we need to see what Shazam (now integrated into the Apple hive-mind) can do. I think that will be telling.

        0
        October 11, 2018
  2. Adam Foster said:

    Between the four of us my brothers and I own 16 HomePods! They are at their best in stereo pairs and I suspect they will continue to just get better. I would never trust any of the other three in my house, ever. With those companies you are the product…

    3
    October 11, 2018
  3. S Lawton said:

    Voice Assistants will more and more be greater than the product that contain them. In the home, there are security products(camera, doorbells, locks, motion detectors) thermostat control, lights, plugs, etc. They are also starting to link with visual that work well especially in the kitchen, but also outside the home (auto, car, kiosks, hospitality suites are just a few examples. Your iPhone is a personal product but voice assistants belong to many and are learning more and more including voice identification and emotion. Siri was there first. Now it has a lot of catching up to do.

    0
    October 11, 2018
  4. Gregg Thurman said:

    The failure of Apple’s competitors, analysts, and the media to see the above is clearly demonstrated in Thompson’s article.

    As long as they continue to be blind to the REAL race Apple will thrive where the rest struggle.

    Great analogy Fred

    0
    October 11, 2018
  5. John Konopka said:

    Voice input is odd. As it is I find Siri very useful for simple things. Even short runs of dictation works well. But to work really well Siri has to be as good as HAL in 2001 or the assistant in the Knowledge Navigator video. That’s a very high bar.

    0
    October 12, 2018

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