Apple gains in smart speaker market share

When Apple launched its HomePod smart speaker earlier this year, many critics claimed that its high price tag of $349 would prevent it from gaining ground against Amazon’s Echo and Alphabet’s Google Home devices, which cost as little as $50.

Apple’s Siri lacked Amazon’s Alexa skills and e-commerce backbone as well as Google’s larger ecosystem of search and cloud-based services. Those flaws, it seemed, would limit HomePod’s appeal to hardcore Apple loyalists.

Despite those headwinds, a recent report from Consumer Intelligence Research Partners indicates Apple has established a foothold in the U.S. smart speaker market with a 6 percent share.

Apple remains an underdog, but its share generates higher revenue per device than Amazon and Google devices. The Mac maker can also use HomePods to tether more users to paid subscription services such as Apple Music. That strategy supports the growth of Apple’s services unit, which posted 31 percent annual sales growth and accounted for 18 percent of its top line last quarter.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Leo Sun owns shares of Amazon and Apple. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, and Apple. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple.