https://medium.com/@BenEinstein/what-cracking-open-a-sonos-one-tells-us-about-the-sonos-ipo-dcab49155643
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Hi joe-sononos-567890
Thanks for the post. I found it interesting but can't say I agree with the conclusion...more on that later. The teardown involving some traditional and non-traditional manufacturing and sourcing might give a glimpse as to what may be missing from the impending IKEA/Sonos partnership. Meaning what makes a Sonos a Sonos versus what IKEA will market.
I think every manufacturer will short-cut a build component here and there to remain competitive in a mainstream consumer oriented market. The consumers I'm speaking of aren't those that are willing to pay $2000 for a single speaker.
The article gave the following conclusion regarding Sonos long term sustainability :
I'm not completely onboard with that assessment as I liken the comment of "incrementally adding technology in an attempt to keep up with a fast-moving race" to that of Apple's. Granted Apple does own a lot of it's core technology; but it also outsources a lot of it's components one of which is to a major competitor_Samsung.
Apple also at least with it's iPhone seems to lag behind on introducing new features that are already available on competitive products. Granted Apple does seem to improve upon them once released into their ecosystem.
I'm not placing Sonos on the same level with Apple. Sonos IMO (if not for the Apple HomePod) would have been a prime target for acquisition by Apple_maybe they still are. My point being that Sonos is looking to the future IMO as evidenced by the introduction of the Sonos One_Gen2. Not to mention the Sonos Amp and introduction of Sonos approved outdoor speakers such as Sonance (another partnership).
Sonos appears to be developing new revenue streams with IKEA and Sonance partnerships to broaden it's market appeal. Introduction of Sonos apparel to jump start the conversation about their brand. IMO all these things are not typical of a company that is on the verge of implosion. Finally an IPO is what progressive companies do to maintain a cash flow. Having a Dow-Jones index is not a bad thing.
There's probably a lot more I could mention but I just don't have the time. What are yours and those of others thoughts?
Cheers!
Thanks for the post. I found it interesting but can't say I agree with the conclusion...more on that later. The teardown involving some traditional and non-traditional manufacturing and sourcing might give a glimpse as to what may be missing from the impending IKEA/Sonos partnership. Meaning what makes a Sonos a Sonos versus what IKEA will market.
I think every manufacturer will short-cut a build component here and there to remain competitive in a mainstream consumer oriented market. The consumers I'm speaking of aren't those that are willing to pay $2000 for a single speaker.
The article gave the following conclusion regarding Sonos long term sustainability :
I'm not completely onboard with that assessment as I liken the comment of "incrementally adding technology in an attempt to keep up with a fast-moving race" to that of Apple's. Granted Apple does own a lot of it's core technology; but it also outsources a lot of it's components one of which is to a major competitor_Samsung.
Apple also at least with it's iPhone seems to lag behind on introducing new features that are already available on competitive products. Granted Apple does seem to improve upon them once released into their ecosystem.
I'm not placing Sonos on the same level with Apple. Sonos IMO (if not for the Apple HomePod) would have been a prime target for acquisition by Apple_maybe they still are. My point being that Sonos is looking to the future IMO as evidenced by the introduction of the Sonos One_Gen2. Not to mention the Sonos Amp and introduction of Sonos approved outdoor speakers such as Sonance (another partnership).
Sonos appears to be developing new revenue streams with IKEA and Sonance partnerships to broaden it's market appeal. Introduction of Sonos apparel to jump start the conversation about their brand. IMO all these things are not typical of a company that is on the verge of implosion. Finally an IPO is what progressive companies do to maintain a cash flow. Having a Dow-Jones index is not a bad thing.
There's probably a lot more I could mention but I just don't have the time. What are yours and those of others thoughts?
Cheers!
I agree with much of the conclusion except for the advice to "own as much of the platform as possible". Easier said than done, because Sonos hasn't the scale to do this.
Given the above, incremental steps seem to be the only way forward, short of looking for a buyer. Will this end in failure as suggested? Anyone with the certain knowledge claimed should be shorting the stock to make some money from the certainty!
Given the above, incremental steps seem to be the only way forward, short of looking for a buyer. Will this end in failure as suggested? Anyone with the certain knowledge claimed should be shorting the stock to make some money from the certainty!
I can't quite agree with the analysis either. While I think the breakdown of parts matters, I don't think comparing Sonos One to Echo plus in terms of parts is really an apples to apples comparison. His point was that you can get an idea of how much the company is innovating and spending on products sure, but it's the features that the hardware brings that really matters. Does it matter that the echo plus has a different speaker design, more mics, and zigbee if the speaker doesn't sound better, the extra mics don't pick up voices better, and no one cares about zigbee (I don't, not sure what the market says)?
Beyond the hardware, you also have the software related features, like streaming capabilities, multiroom capabilities, and voice assistant features to compare. Not to mention the various patents that both companies hold. And who says that Amazon speakers and Sonos can't both succeed in the market? Is it not big enough for several competitors? For one thing, Sonos position as being services agnostic will surely appeal to many customers who don't want to over commit to one of the tech giants.
I do 100% agree regarding the authors statements about an unfair advantage for Amazon. Spot on there. I think the same reasoning applies to many of the other tech giants out there, such as Google, Apple, Amazon, Microsoft, Facebook and probably a few others. I'd really like to see further discussion on using anti-trust laws to even the playing field a bit so that smaller companies have a chance to compete fairly in these tech markets. While the building of the tech infrastructures we have today was enabled by the presence of investment by these giants, I would predict that will eventually start to inhibit growth as the few control virtually everything in tech.
But that's a much bigger topic.
Anyway, I wouldn't say Sonos is a slam duck to succeed and grow well over the next 10 years or so. I am optimistic, but the unfair advantages and competitiveness in the market are realities that can't be ignore. What I feel very strongly about is that the customer base and patents held by Sonos is way too valuable to just disappear. Sonos will be sold to a company that can take advantage of Sonos value at some point, if they don't manage to succeed over the next couple years.
Beyond the hardware, you also have the software related features, like streaming capabilities, multiroom capabilities, and voice assistant features to compare. Not to mention the various patents that both companies hold. And who says that Amazon speakers and Sonos can't both succeed in the market? Is it not big enough for several competitors? For one thing, Sonos position as being services agnostic will surely appeal to many customers who don't want to over commit to one of the tech giants.
I do 100% agree regarding the authors statements about an unfair advantage for Amazon. Spot on there. I think the same reasoning applies to many of the other tech giants out there, such as Google, Apple, Amazon, Microsoft, Facebook and probably a few others. I'd really like to see further discussion on using anti-trust laws to even the playing field a bit so that smaller companies have a chance to compete fairly in these tech markets. While the building of the tech infrastructures we have today was enabled by the presence of investment by these giants, I would predict that will eventually start to inhibit growth as the few control virtually everything in tech.
But that's a much bigger topic.
Anyway, I wouldn't say Sonos is a slam duck to succeed and grow well over the next 10 years or so. I am optimistic, but the unfair advantages and competitiveness in the market are realities that can't be ignore. What I feel very strongly about is that the customer base and patents held by Sonos is way too valuable to just disappear. Sonos will be sold to a company that can take advantage of Sonos value at some point, if they don't manage to succeed over the next couple years.
I sometimes wonder if Sonos should have never made speakers with built in mics themselves for this very reason. They are always going to be playing catch up to add in whatever feature that Amazon, Google or Apple come up with. And it really ins't the reason people are looking to buy Sonos to begin with. They will always choose Sonos over this because of the speaker quality, not voice assistant features.
I'm not suggesting Sonos shouldn't have done integrations, those are a huge plus. However, I'd guess integrations from an echo dot to a Sonos speakers are not nearly as difficult to maintain and development as building your own mics into your speakers. A lot of folks are going to prefer separate voice assistants and speakers anyway, particularly if voice assistants with associated video screens (echo show/google home hub) gets more popular.
I sometimes wonder if Sonos should have never made speakers with built in mics themselves for this very reason. They are always going to be playing catch up to add in whatever feature that Amazon, Google or Apple come up with.
I agree, with the caveat that I have no experience of either the Sonos One or the Alexa integration; in India the only thing that works are Dots/Spots wired to line in on Sonos, but I suspect that this works better than either of the former two because the Dot is alway up to date with the latest Amazon changes. It isn't just a question of Sonos playing catch up, but also of the Amazons dictating the pace at which it can do so.
As I have said elsewhere in a dedicated thread, all that was needed was a line in jack on a play 1.
I agree, with the caveat that I have no experience of either the Sonos One or the Alexa integration; in India the only thing that works are Dots wired to line in on Sonos, but I suspect that this works better than either of the former two because the Dot is alway up to date with the latest Amazon changes.
It may have been the case originally, but certainly not today. The functionality of Alexa groups gives you much greater control than a wired connection, without effectively disabling other Sonos features.
It isn't just a question of Sonos playing catch up, but also of the Amazons dictating the pace at which it can do so.
I agree when it comes to the built in voice assistance, but not the alexa integration itself. Very little of what Amazon is dictating has to do with streaming service playback. Alexa groups is really the only change.
If Alexa groups refers to multi room play, it has been available via the line in route from the first day that Amazon released the feature. And I thought it took the alexa integration quite some time to get the ducking to be as convenient as it always was on dots wired to line in.
But, we digress...
But, we digress...
It does do that, but it allows it to be done by default if you wish. You can also have multiple echos pointing to the same Sonos speaker (or group of speakers). Your Sonos and echo also don't need to be physically located to each other. And maybe most importantly, your Sonos speaker doesn't have to be set to line in for you to hear any audio the echo is creating, whether that music or a response to a question. That may not matter in many situation, but is vital if your speaker is connected to a TV.
Yes, we're digressing...but it's kind of a slow day.
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