There a few variables guiding this new competitive landscape.

Monitoring. Value will flow to devices and software that can monitor significant portions of our day. Intelligence. Devices will learn from this data in order to provide feedback to the user. Personalization. Hardware personalization will gain importance as the line between technology and fashion becomes blurry.

HomePod plays squarely in two of those three factors out of the gate. A HomePod will make for a great monitoring device while it will also be able to provide intelligent feedback via speakers and microphones. While HomePod doesn't play in hardware personalization similar to that of Apple Watch and other wearables, the personalization angle takes the form of tailored, personalized listening experiences suited to our specific hearing needs.

When it comes to the concept of a smart home, we are still looking at pretty rudimentary ideas. A home won't be truly smart until tech companies build housing and we are no longer able to tell between smart and non-smart items. Up to that point, a smart home describes the concept of controlling things around the home that move. Given how the smart home battle is still in the early stages, Apple has the opportunity to do quite a bit with HomePod and the concept of augmented hearing in the home.

HomePod is not Apple's first product designed to compete for our attention in the home. Instead, Apple has been selling Trojan horses in its battle for our home called iPhones, iPads, and Apple Watches. These mobile devices are very likely to remain near us, or in some cases, on us, when we are at home. HomePod is unlike the Amazon Echo because it doesn't pretend that we lack smartphones, tablets, or wearables. This is one reason why Apple decided to take a straightforward path in pitching HomePod as a great music speaker. The device is all about producing sound so great that it cannot be replicated by any of our other devices, even if the HomePod has touch controls located on the top of the device.

Pricing

When it comes to pricing, HomePod should not be compared to voice assistant conduits such as Amazon Echo or Google Home. The HomePod is not just a "smart speaker." Saying that HomePod is competing against Amazon Echo is equivalent to saying the iPod competed against generic MP3 players.

Instead, a more relevant HomePod comparison would be dedicated speaker systems from Sonos and Bose. With HomePod, Apple is aiming to sell the best speaker someone has ever owned. The Sonos Play 5, at $499, may be the closest comparable speaker to HomePod within the Sonos lineup. At $349, HomePod is priced very competitively not only when it is compared to the Play 5, but even when it is compared to the $299 Sonos Play 3, which was inferior to HomePod in terms of sound quality. Meanwhile, surround sound speaker systems from Bose retail from $700 to $1,000, or the same price as three HomePods.

Of course, comparing HomePod to existing speakers in the marketplace ignores the fact that HomePod is powered by an A8 chip. This is like comparing AirPods to a simple pair of bluetooth wireless headphones lacking Apple's W1 chip. While Sonos claims to do some form of room mapping to alter its sound output, the process just doesn't compare to that which is found with HomePod.

Challenges

As with any major new product category from Apple, management is placing a few big bets on HomePod. Apple is ultimately looking to sell a new idea to consumers. This idea involves positioning stationary speakers throughout the home. The concept may seem like a stretch today because it mostly is when looking at the current state of standalone speakers. Judging by sales, the standalone speaker market is niche. We have not seen the need to buy stand-alone speakers to accompany existing speakers found in TVs, iPhones, and iPads. Apple wants to change consumer behavior with HomePod. The other challenge Apple faces is convincing people of the value attached to augmented hearing.

Goals

Apple likes to point out how music is in its DNA. We can look at iTunes, iPod, iPhone, Apple Music, and now AirPods, as well-known Apple products tasked with rethinking how we consume music. One product missing from that list is the iPod Hi-Fi. In what may come as a surprise to many, Apple actually sold a standalone speaker (which also retailed $349). The fact that iPod Hi-Fi was available for just 17 months back in 2006 and 2007 speaks volumes as to its ultimate success.

There are key differences between that speaker and HomePod. iPod Hi-Fi was meant to sell iPods (and iTunes) by making it easy to connect an iPod to a great-sounding home stereo. HomePod is given a much more ambitious goal, which is to reinvent sound in the home. In fact, Apple wants HomePod to redefine sound in the home much as iPod, iPhone, and now AirPods, redefined sound on the go. Apple will begin this quest by initially positioning HomePod as a great speaker that can add value to the Apple ecosystem. Apple's audio engineering team is at a completely different place today than it was 10 years ago. However, the fundamental difference between HomePod and iPod Hi-Fi quickly becomes obvious as Apple silicon allows the HomePod to do revolutionary things with speakers and microphones.

The writing is on the wall: Apple wants to control as many speakers in our lives as possible. Controlling sound is Apple's secret strategy for gaining a stronger foothold in the home.

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