Sean D. Emory
Apple continues its success within consumer electronics as they have over 1 billion devices in consumer's hands. Their most recent motivations come from software and services. Apple Music, which was launched in 2015 now sports 50 million paid users (Forbes). This is second to only Spotify’s 75 million, but Apple is gaining 2 million users per month. It is expected that Apple will eventually surpass Spotify as Apple’s monthly growth rate sits at 5% versus Spotify’s 2% rate. This is the tip of the iceberg for Apple as Cook confirmed that Apple is preparing to launch a video content business next.
To complement their music and entertainment business, they launched AirPods, along with their latest edition, HomePod. Both have received strong reviews for their simplistic design and speaker quality. While Apple's competitors such as Amazon and Google go after price, Apple has focused on overall user experience. The home speaker market will function differently than traditional Apple categories as replacement cycles will likely be extensive.
Time will tell for the music category and from my point of view, it will be an interesting competition going forward.
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Sean D. Emory
Avory & Co. Founder & Chief Investment Officer
Disclaimer: This is not a recommendation for purchase or sale of any securities. Avory is an investor of Apple.
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