Much digital ink has been spilled over Apple’s HomePod because 1) it’s expensive relative to Amazon’s talking speakers, 2) introductory features are not yet complete, 3) Apple is late to another industry trend, 4) did I mention HomePod is expensive?
Those of us who have watched Apple for a few decades know HomePod arrives to a familiar situation. Behind the competition. Of course, that’s just like Apple Stores back in the last century when retailing computers was on the way out. That’s just like iPod and iTunes and iTunes Music Store. All were late to the party, but they brought riches to Apple anyway.
Then along came iPhone, the App Store, iPad, Watch, AirPod, et al, and Apple repeated history by dominating a category for which the company and its products were criticized as 1) too expensive, 2) not feature complete, 3) behind the competition.
HomePod arrives to familiar territory but there is one huge difference that critics have ignored. The customer base.
Back in the last century when Apple launched the Apple Store– amid intense criticism and negative analysis– Apple was the Mac; they were synonymous. But back then Apple had perhaps 25-million customers. The iPod changed Apple forever because it introduced the company’s cleverly designed techno gadgets to a few hundred million Windows users. iPod prospered. iTunes Music Store prospered. Apple Stores prospered. The Mac prospered. And Apple prospered thanks to a few hundred million new customers.
Then along came iPhone and iPad and Watch and within a few years Apple was the most prosperous company on planet earth and today has about one billion customers; Mac, iPhone, iPad, et al. It’s that massive customer base which helped to make Watch a thing. After all, Watch is little more than a fashionable exercise and notification accessory for iPhone, but it prospers because, 1) it’s a good device and accessory, 2) it’s an affordable luxury, 3) even 1-percent of 1-billion customers makes for a strong product launch.
It’s 2018 and we’re on the verge of HomePod’s official launch. Critics and analysts reached back into the past to bring to the present all those negative memes about Apple Store, iPod, iTunes, iTunes Music Store, iPhone, iPad, Watch, etc., but applied them to HomePod.
HomePod is too expensive, too late to the party, doesn’t do enough to justify the price, and only Apple faithful will buy it. Well, duh. But a few percentage points of Apple’s 1-billion or so customer base means 10-to-20-million HomePods could be sold in the first few years. 20-million HomePods by the end of 2019 means a $7-billion business, and 12-million HomePods a year means a $4-billion annual business.
Only Amazon and Google know how well Echo and Home are doing, but in two years– based on Apple’s massive 1-billion or so customer base– HomePod could be doing what Watch, iPhone, iPad, Mac, Beats, AirPod are doing now.
Cleaning up the profits.
That’s what happens when you have that many customers.