Google, Amazon Losing Money Over Discounted Smart Speakers

After Google and Amazon discounted their prices for their respective smart speakers analysts have said both companies would have lost a couple of dollars per unit.

Reuters reports analysts at ABI Research says the Echo Dot has US$31 worth of parts and it was selling for US$30, the discounted price. The Google Home Mini has US$26 worth of components with it priced at $29 at a discount.

Prices for the Google Home dropped in Australia mid-December from $199 to $128. Rumours have been circulating Amazon Alexa will be launching in Australia this year.

Reuters spoke to Adam Wright, senior research analyst at IDC saying he estimates 35 million smart speakers have been installed worldwide, a figure updated two weeks ago which does not include Christmas sales.

Analysts have also pointed out this is a completely different strategy to Apple and its awaited HomePod which could be retailed around US$379.