So perhaps
it shouldn't be surprising that at Apple's product event on Monday, the AirPods
stole the show.
For the
first time in two years, Apple updated the AirPods line. The $179
AirPods 3 promise spatial audio, better sound quality, longer-lasting battery,
a new contour design and customizable sound that adapts to what the ear is
hearing, a feature already available on Apple's higher-end AirPods Pro line.
They also come with shorter stems and without the plastic tips found on their
predecessors, small tweaks that highlight how the once ridiculed design
continues to change.
Crucially,
Apple also cut the price of the second-generation AirPods to $129, which could
help the company attract more customers and compete with a growing number of
similar products from the likes of Amazon, Google and Samsung.
Dan Ives,
an analyst at Wedbush, said AirPods could represent about 5% of Apple's total
revenue this year and he predicts it will likely grow by 20% by 2022 due
largely to the new model and the cheaper AirPods 2. He estimates Apple will
sell 100 million units by next year.
The
"company has turned this into a $20 billion annual business, a major
feather in the cap for Apple," Ives told CNN Business.
Apple
doesn't break out sales figures for the earbuds, but AirPods and Apple Watch --
arguably the two most successful new hardware products of Tim Cook's tenure as
CEO -- are key parts of the company's Wearables, Home and Accessories division,
which now collectively brings in more revenue than the Mac division.
By lowering
the entry-level price for AirPods, Apple is once again betting on the winning
strategy it has used for products like the iPhone and Apple Watch. In addition
to the AirPods 2 and AirPods 3, its premium AirPods Pro costs $259 and Apple's
over-the-ear headset, the AirPods Max, sells for $550. Offering a range not
only encourages more customers to purchase Apple products but allows them to
fall deeper into its device and app ecosystem.
From CNN Business
