Smart speakers like the Amazon Echo and Google Home were one of the most sought after gifts during this holiday shopping season. Amazon revealed that it sold millions of Echo units during this period. However, a new report suggests that the company may not have made money on these sales. In fact, it may have ended up losing money. Google is reportedly in the same boat.
According to the report, Amazon and Google were involved in market share contest over the holidays. They deeply discounted their smart speakers to the point where they likely lost a few dollars per unit. Both companies offered significant discounts on their smallest smart speakers.
The Amazon Echo Dot was priced at $29 while the Google Home Mini came down to $50 over the holiday season. Apple’s Siri-powered HomePod smart speaker was supposed to be out during this period but the company delayed the release to 2018.
Its $349 speaker is now expected to go on sale in a few weeks. Apple reportedly aims to make a profit on this device and would likely not have indulged in the market share contest with Amazon and Google during the holiday season. The discounts did help both companies to get customers a taste of their digital assistants.
Selling the speakers at impulse-buy prices would have brought in new customers and the companies will now try and retain them to profit from sales of goods in the future.