Google Should Give Away Home Minis For Free, Says Morgan Stanley Analyst

Jun. 30, 2018

At least one Morgan Stanley analyst believesGoogleshould give away itsHome Mini speakersfor free if it want to compete with theAmazon Echo. In a new research note, analyst Brian Nowan claimed that the growing popularity ofdevices with Amazon Alexamight give the Seattle-based e-commerce company a huge advantage over Google in terms of ad revenues in the coming years.

“We argue Alphabet needs more devices/smart speakers in people’s homes. The growth of voice shopping combined with Amazon’s expected install base advantage could threaten long term growth in Alphabet’s high-monetizing retail search category. Like the mobile transition when Alphabet gave Android to OEMs and began paying Apple to power Safari search, we believe Alphabet should give away a Google Home Mini to every US (arguably global) household”

As for the economics of the whole ‘free Home Mini’ plan, Nowan said that considering it only takes Google about $26 to produce each Home Mini, the company should be able to give away the devices to all 126 million US households for under $3.3 billion, which is a drop in the ocean for a company the size of Google’s parent, Alphabet.Image Courtesy: Morgan Stanley

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