What Cracking Open a Sonos One Tells Us About the Sonos IPO
Ben Einstein

Love me a good Bolt teardown and the analysis of Amazon’s unfair advantage is spot on.

Curious on your perspective as to *why* Amazon used all these fancy techniques that add cost? Yes, they don’t *need* to minimize BOM cost because they make much more margin elsewhere in the value chain but still…

The only obvious benefit you mention a few times is delivering on a somewhat unique cylindrical industrial design (in the smart speaker space at least). Perhaps the cylinder stack assembly makes it easier to assemble and Amazon cares more about the marginal labor costs? Is that why the heavy bass driver is not placed at the bottom? Perhaps the CNC drilled exterior is less prone to rattle over the long term vs a steel wrap like the Sonos? Or less prone to stains like fabric wrap a la the UE Boom cylindrical speakers? It at least allows for the literally seamless ID but others have dealt with that seam nicely.

But overall the Sonos One is lauded as having much better audio quality in the media, despite a lower BOM cost, and arguably an equivalent aesthetic appeal. I don’t know how much the average consumer cares about “better than sufficient” audio quality but it does seem odd to spend more on BOM for unclear functional benefits. Our colleague Jordan Rice might ask: did they sacrifice a little on two sides of the Iron Triangle (good and cheap) in order to gain on the third side (fast)?

In a rapidly maturing market with lots of lock-in and inertia maybe they just wanted something distinct to get on kitchen counters and bookshelves quickly — margin and optimal audio be damned in pursuit of first mover advantage and all the network effect benefits that come with those additional users?

And if you were Sonos what would you do? You’ve got some kind asset in terms of audio quality per BOM $$$ relative to Amazon but you’re the underdog on total value capture. What’s a long term survival strategy? My best first guess with little analysis is doubling down on multi-platform compatibility — what’s yours? Any ideas Chris Loughnane or David Mallard?