Thursday saw Amazon Alexa-based product launches of new voice-enabled devices as varied as an Echo for the car to an Alexa-controllable microwave oven. Later this year, all Echo devices will be able to receive the Tidal music service, Amazon said. The company began taking pre-orders for a “companion DVR that lets you easily watch, record, and replay free over-the-air TV programming” on Fire TV, Echo Show and compatible Fire tablet, iOS, and Android devices. Aimed at cord-cutters, it works with an HDTV antenna, said the company. A car Echo has eight-mics for in-car acoustics and speech recognition technology and is said to let Alexa hear users “over music, A/C, and road noise.” It connects via smartphone.
Carriers pitched 5G with day one of Apple iPhone Xs and Xs Max smartphone (see 1809120055) preorders, even though Apple isn’t expected to have a 5G-capable phone before 2020. Apple headlined the Super Retina screen, including the "largest display ever” on an iPhone, faster Face ID, the A12 Bionic chip, the dual camera system and improved water resistance. AT&T, Sprint and Verizon led with preorder options for the iPhones and the Apple Watch Series 4, due to ship Friday, and gave Oct 19 preorder and Oct. 26 availability dates for the iPhone XR. Retailers got in on it, too. AT&T Wireless featured unlimited data and streaming media add-ons. The carrier also mentioned its introduction of mobile 5G “on the horizon,” saying it’s expected to be available in 12 cities this year and at least 19 in early 2019. After promoting its 5G service, AT&T said the iPhone Xs and Xs Max are using AT&T’s LTE-LAA network technologies, capable of offering a “theoretical peak speed of up to 1 gigabit per second” in 15 markets “and counting.” Verizon summarizing the week's news listed preorders for iPhone Xs and Xs Max last in a series of company news items behind 5G and Hurricane Florence (see 1809140037) updates. “THIS IS BIG. 5G is here” took top billing. The company noted the world’s first commercial 5G service launches Oct. 1 and that it began taking preorders for 5G Home in Houston, Indianapolis, Los Angeles and Sacramento at FirstOn5G.com. Sprint and T-Mobile, seeking government OK to combine, also had promotions here and here. Fifth-generation was much discussed at conferences last week on both coasts: 1809140023 and 1809130043.
Apple’s annual September product launch lacked the typical surprise and any word of the AirPower wireless charging pad first mentioned last September to charge an iPhone, Apple Watch and AirPods simultaneously (see 1709120062). Wednesday's event streamed from the company's Cupertino, California, headquarters focused heavily on camera features in the three new iPhones and on medical capabilities of the Apple Watch Series 4. The largest Apple phone to date, the iPhone Xs Max, has a 6.5-inch display, leading industry analyst Ross Rubin to tweet: “As if there were any doubt left why Apple killed the iPad mini.” The latest iPhones start at $749 for the iPhone XR, due in October, at $999 for the iPhone Xs and $1,099 for the iPhone Xs Max, slated for Sept. 21 shipping. Good news about the new iPhones is they are 600 MHz compatible and will use the spectrum T-Mobile bought in the TV incentive auction, an executive of the carrier said later that day (see 1809120031).
Digital media adapters helped fuel 39 percent growth in smart home device sales to 130.1 million shipments in Q2, IDC reported Monday. Smart TVs account for the largest share, followed by digital media adapter (DMA) sales from Roku and Amazon, which grew 27 percent year on year in Q2. Current-generation smart TVs offer much functionality of DMAs but lag in software updates, it said. "Networked entertainment represents a key stepping stone” for consumers starting on a smart home path, said Adam Wright. DMAs are an “important gateway into content ecosystems as well as broader consumer IoT ecosystems,” said the analyst. Amazon Fire TV products led DMA sales, Google is second with Chromecast, and Roku, “extremely popular in the U.S.,” is third, the research firm said. Expect the market for more neutral hardware platforms like Roku to grow “as consumers are rarely faithful to one content provider," said analyst Jitesh Ubrani.
U.S. tariffs on products from China caused Brilliant Home Technology to price its smart-tech goods “a little higher than we planned to," about $50 higher at retail, CEO Aaron Emigh told us in a pre-product announcement. “It sounds strange to have concerns over parts that cost a penny, but that’s the thing that could constrain the ability to build these things right now,” he said of the “hundreds of capacitors” it uses per device. The CEO testified at a U.S. Trade Representative hearing last month against the duties levied over IP concerns (see 1808210047), which are also raising tech hackles (see 1809060019). Thursday it announced technology to control lights, thermostats, locks, doorbells and Sonos speakers over Wi-Fi from a smart light switch. Prices start at $299 for a switch with a 5-inch diagonal LCD touch screen.
Best Buy CEO Hubert Joly said tariffs could lead to price hikes for consumers, on a Tuesday earnings call after reporting results for its Q2 ended Aug. 4 that accompanied a stock decline. “When there’s a price increase, there’s an impact,” he said, though the Trump administration has “very important international trade goals.” Effects from tariffs will be “tightly linked” to gross profit margins, Joly said. A 25 percent tariff on an item with a gross profit of 20 percent will result in a 20 percent price increase, said the executive, noting vendors’ ability to absorb tariffs and over time diversify their supply base. The retailer's Q2 online sales growth slowed to 10 percent after 31 percent sales growth in the year-ago quarter over the prior-year quarter, said Chief Financial Officer Corie Barry, underscoring the retailer’s “mature” position in e-commerce. It's gaining market share online, said Barry, now at 15 percent of domestic revenue. Barry called the consumer electronics segment “mature,” with customer buying patterns that moved online “earlier than most.” But the company beat some expectations in Q2 on strength in wearables, mobile phones and gaming, she said. The stock closed the day down 5 percent at $77.57.
Over-the-top viewers are spending more time watching virtual MVPDs, blogged comScore Tuesday. Nearly half the time spent by OTT households with a vMVPD such as Sling TV, DirecTV Now, PlayStation Vue, Fubo, Philo, YouTube TV and Hulu Live is spent with that service, said analyst Susan Engleson. OTT adoption rose 17 percent year on year, said the firm. VMVPDs “are a prime example of viewers utilizing digital mediums to watch live content formerly only available on linear TV,” Engleson said. Though penetration is at 5 percent of U.S. households, it rose 58 percent. The average OTT household with a vMVPD service uses 1.5 times more over-the-top services than the average OTT household. Engleson sees those numbers accelerating due to competitive price points and low barriers to entry for consumers because no installation is required: “We will continue to see significant growth in virtual MVPDs in the years to come.” Other providers are testing or have announced plans for a vMVPD offering, “indicating that they take this trend seriously,” she said. With cable companies adding the ability to access Netflix via a set-top box, “it may be that future generations do not distinguish between a streaming box and a cable box at all -- there will just be one place consumers go for their entertainment,” she said.
Control4 can financially handle the Trump administration's planned tariffs on Chinese goods that concern some tech companies (see 1808030034), executives said Thursday. Friday, the stock closed up 20.6 percent to$31.67after reporting record revenue and net income in Q2. Chief Financial Officer Mark Novakovich said the company will absorb and offset the impact of planned tariffs and doesn’t plan to change product pricing this year, partly due to lower tax rates. “We will continue to ... explore all options available to reduce the impact.” The home automation company is exploring many sourcing options or scenarios, Novakovich said. He said it's too early to make a decision because of costs associated with changes, and too soon to make long-term commitments "until we know more about the duration of some of these tariffs and the specific product classes that they are going to definitively impact." CEO Martin Plaehn confirmed his company is working with Apple for control of Apple TV over IP for a product resulting from the bigger company releasing application program interfaces to enable third-party companies to control media streamers.
Sonos shares closed at $19.91 Thursday, a 24 percent increase from the opening price on its first day public. The company whose board includes ex-FCC Chairman Julius Genachowski had targeted $17-$19 to raise $264 million (see 1807230060). Competition is rising, including from the companies whose content and voice control platforms Sonos is relying on to carry it into the next voice control age of audio. It cited as a risk factor dependency on companies including Amazon and Apple, saying success with voice control increasingly will depend on willingness of technology partners with more financial resources to continue to promote and enhance Sonos products, "many of which sell or may develop products that compete with ours.” Senior Vice President-Product Marketing and Collaborations Allen Mask downplayed that risk with us Thursday, saying Sonos views itself as complementary to Amazon, Apple and Google. “Big tech companies have a very different core business than ours,” with Sonos standing apart as an open system with “freedom of choice,” he said. “We welcome all voice assistants, we welcome all streaming services, we welcome companies to build on top of our platform.” The newly public company outsources most manufacturing to contract manufacturer Inventec, which makes products for the company and its competitors at facilities in China. Tariff threats (see 1808020067) are "top of mind for us, as it is for everybody across the consumer electronics industry,” Mask told us. Sonos is “not happy about the discussions being had." The company is working with CTA to combat the proposed tariffs, and Mask noted “if and when tariffs come down, we feel hopeful.” The “premium nature” of the brand should leave the company less exposed so it’s not affected materially long term, he said.
Regulatory hurdles are the top hurdle for Energous, CEO Stephen Rizzone said of the company's wireless charging plans. Some of its products have gotten FCC OK (see 1804110034). Following Q2 results that included a slightly narrower net loss of $12.3 million as revenue fell 31 percent from the year-ago quarter to $205,773, shares closed 8.9 percent lower Thursday at $12.32.