Analysts: Amazon, Google’s discounted speakers cost ‘em money, but will hurt HomePod sales

Reuters reports that Amazon and Google’s Alphabet division both discounted their virtual assistant speakers so deeply over the holiday shopping season that they likely lost a few dollars per unit, “highlighting a sharply different strategy from Apple as it prepares its HomePod speaker,” according to pundits such as Paul Erickson, a senior analyst with IHS Markit and Adam Wright, senior research analyst at IDC.

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Both companies cut prices for the smallest version of their speakers, the Amazon Echo Dot and Google Home Mini, to as little as $29 from $50 for the U.S. holidays. Midlevel versions cost a bit more than twice as much.

However, Apple aims to make a profit on its HomePod (due in “early 2018” after a delayed release) and bolster sales of its $9.99 per month Apple Music subscription, analysts said. Though Amazon and Alphabet lost money on their speakers, their discounted pricing will probably hurt HomePod sales, they add.

“Apple is in a bit of trouble,” Wright said.

The HomePod will cost $349. The device is just under seven inches tall and looks like a piece of furniture. It will be available in both space gray and white, and also acts as a hub for HomeKit devices to provide remote access to home automation.