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Apple HomePod Sales Struggle, Fall Way Behind Amazon Echo
By Seung Lee
Posted: April 15, 2018 6:34am PDT

The HomePod has not delivered the sonic boom Apple had hoped for so far. Apple's new $329 home speaker had strong pre-orders when it was launched Feb. 9, but it has petered out in the increasingly competitive home speaker market since, Bloomberg reported Wednesday.

Three weeks after its debut, the HomePod, at its nadir, captured about 4 percent of the weekly sales of smart home speakers. Inventory is rising in Apple stores, and Apple cut back on orders and lowered sales forecasts, according to Bloomberg, which cites numbers from Slice Intelligence.

During its preorders, Apple made up a third of the smart home-speaker market. But after its first 10 weeks on the market, Apple HomePod made up only 10 percent of the smart home speaker market, just behind second-place Google Home's 14 percent. The overriding winner was the Amazon Echo, which made up 73 percent in that same period.

Bloomberg pointed to the HomePod's lagging artificial intelligence, powered by Siri, and other limited capabilities when compared to Amazon Echo and Google Home, as reasons for its sluggish sales. HomePod, despite being $100 more expensive than the most expensive Amazon Echo product -- Echo Show, which has a video screen -- is limited in voice commands to mainly controlling Apple's proprietary apps, such as Apple Music.

Apple is forecasted to sell 7 million HomePods in 2018 and about 11 million in 2019, longtime Apple observer and Loup Ventures founder Gene Munster told Bloomberg. Those figures pale in comparison to Amazon and Google's forecasts: Amazon is forecasted to sell 29 million and 39 million Echos in 2018 and 2019, respectively. Alphabet, Google's parent company and owner of Google Home, is forecasted to sell 18 million and 32 million in 2018 and 2019, respectively.

From its introduction at last year's Worldwide Developers Conference in San Jose in May, Apple marketed the HomePod not as a smart home speaker but rather a smart audio device with superior sound quality than competitors such as Sonos.

Apple may be making moves to amend its Siri shortcomings. Earlier this month, Apple hired Google's top executive in artificial intelligence and search, John Giannandrea, to oversee Siri and improve its technology. Giannandrea will report directly to Apple CEO Tim Cook but may be chafed by Apple's policy in not collecting user information from iPhones and iPads to enhance artificial intelligence networks such as Siri.

"Our technology must be infused with the values we all hold dear," said Cook in a company memo announcing Giannandrea's hiring. "John shares our commitment to privacy and our thoughtful approach as we make computers even smarter and more personal."

© 2018 San Jose Mercury News. Syndicated here under contract with YellowBrix, Inc. All rights reserved.

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