Analyst Ming-Chi Kuo has highlighted the importance of AirPods for Apple in his latest research note. The analyst notes that AirPods are going to surge in popularity over the next few years and become an important product for Apple. Their popularity will also lead to the likes of Google and Amazon into releasing their own wireless earbuds.
With less than 5 percent iPhone owners using AirPods and over a billion users out there, the scope for growth is huge here. The AirPods continue to remain in high demand almost two years after their initial debut which is a testament to their success.
Kuo highlights that AirPods will become an important product for Apple since it would make it costlier for an iOS user to switch to Android. The wireless earbuds also provide an easy and quick access to AI and voice assistant services which are getting increasingly important with time. Lastly, Kuo believes the AirPods can work in tandem with the Apple Watch to offer even better health tracking features.
We believe that the AirPods are more than just earbuds for Apple and will become increasingly important in Apple’s ecosystem for the following reasons. (1) They increase the switching costs for users to Android from the iOS ecosystem. (2) This is an important device for voice assistant/AI services because it can easily enable the voice assistant. (3) The ear is a perfect sensing area for detecting various health data. It may integrate with the Apple Watch to offer better health management in the future.
The rising popularity of AirPods has also got the attention of Amazon and Google which will release their own AirPod competitors in the second half of 2019. Both companies will ship around 15-20 million units of their wireless earbuds, though that is not going to put any dent on the sales of AirPods. Kuo expects Apple to ship a staggering 50 million+ next year, with the earbuds breaching the 100 million mark by 2021.
Apple is due to unveil a minor refresh of the AirPods with a wireless charging case. However, despite multiple rumors, there has been no word from the company about it. Kuo is also unsure about the timeline of its release, though he expects it to launch by Q1, 2019.