Apple to Launch Doorbell, Lock and Thermostat Developed With LG

SPEAKER_1 (0:02)

Bloomberg Audio Studios, Podcasts, Radio, News.

Tim Stenovec (0:08)

You're listening to Bloomberg Businessweek with Carol Massar and Tim Stenovec on Bloomberg Radio.

Carol Massar (0:15)

So, how about an Apple doorbell?

Mark Gurman (0:17)

Maybe. Okay.

Carol Massar (0:19)

An Apple lock? Okay. An Apple thermostat? Can I say no, because I don't let anyone in my house touch the thermostat but me.

Do you know we have a high-tech house? No, we don't. We have a doorbell and that's it. Well, we know Apple is coming for the home. We know that thanks to the ongoing insight and reporting out of our own Mark Gurman. He's Bloomberg News managing editor for Global Consumer Tech. He's the host of the recently launched Power On podcast and of course, the keeper and writer of his Power On newsletter, which you can subscribe to on the Bloomberg and at bloomberg.com. He is out there in the Bloomberg News LA Bureau. She may not have a connected house. I kind of do and I'm waiting to see if my husband's going to go all in on Apple.

Mark, they've been focusing on the house, so this is now we're getting details.

Mark Gurman (1:02)

Yes. I've been reporting for the last two to three years or so that Apple is introducing a slate of new home devices as part of a reboot to their Smart Home strategy. Of course, the flagship device is this Smart Home Hub with a display. There's a new HomePod Mini and new Apple TV set-top box, but they're going further than that and they're introducing this all next week. They're going further by introducing an ecosystem of accessories that play in to this new Smart Home platform. They've partnered with LG to develop a slew of new accessories. You mentioned some of them. There's a thermostat, there's a doorbell, there's a deadbolt lock, there's a temperature sensor, and then there's three types of cameras. There's an indoor camera, an outdoor camera, and a floodlight camera, all for security. You'll be able to view all this information and control it with this new Smart Home platform, which is really a reboot of HomeKit.

This is something that's been years in the making. It's finally rolling out, and I think it's particularly exciting.

The home is important for Apple, and they're finally going to try to own it after completely failing in their first attempt.

Carol Massar (2:06)

Now, you mentioned LG. Why is it important for LG to have them as a partner? It threw some people a little bit off course there.

Mark Gurman (2:13)

Yeah. Well, the LG thing is, I mean, just to be honest with you, it's random.

Right. It's kind of weird.

Because LG doesn't make any of these products, right? If they were partnering with Ring, for example, which they never would do, would that be really a surprise? No, because Amazon and Ring, they make all these devices already. They've been doing it for years. LG doesn't make thermostats. LG doesn't make smart home cameras. LG doesn't make locks. Doesn't make doorbells. And so Apple seems to have found a consumer electronics manufacturer and company that would be willing to play ball with them and be part of this ecosystem and work within their parameters. And so that's why they're using LG.

Carol Massar (2:47)

Is this like a Foxconn for Apple in this venture?

SPEAKER_1 (2:50)

Is that what LG is?

Carol Massar (2:53)

I know it's not Apples to Apples.

Mark Gurman (2:54)

Sort of. No, it's a little bit different. Okay, so let's break it down. A first-party device would be something designed and developed by Apple. A third-party device would be another company, you know, Ecobee or whatever, developing a thermostat on their own and making it compatible with the Apple ecosystem. This is what I call second-party. So it's between first-party and third-party. It's second-party because Apple is working. They've co-developed this with LG.

Carol Massar (3:21)

Well, I don't understand about the smart home devices market in itself. I mean, how big is it? What is the competition like? Because didn't they have the, what is it, the HomeKit? The Apple's HomeKit? Did it work out so well? I've been trying to show, we have Google Home at home. I just was pulling up the app where it's everything. It's lights, it's cameras, it's temperature.

Mark Gurman (3:41)

Cameras, doorbell, locks, everything.

Carol Massar (3:43)

Yeah, so there's other players out there.

Tim Stenovec (3:46)

How big is this market?

Mark Gurman (3:47)

Well, Nest is huge, and Amazon is huge. So basically the two bigger players in the US are Google and Amazon, and Apple wants a slice of that market, and they did a horrific job with HomeKit. It has so many issues. The app is terrible.