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Sonos tries to get its groove back after upsetting loyal customers

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Sonos tries to get its groove back after upsetting loyal customers

Heath Evans really needed his Sonos speakers to work.

He and his wife counted on one of the three wireless devices he owned to play lullabies to help put their baby daughter to sleep.

So, in May, when Sonos released a new controller app that was so riddled with problems he couldn’t get the speakers to work, Evans was angry.

“We just need reliable music that plays lullabies while we’ve got a screaming baby trying to go to sleep,” said Evans, a 40-year-old entrepreneur in Australia who had received the speakers from his wife last year for his birthday.

Fed up with the time Sonos has taken to fully fix the app, the family has given up on trying to use the devices, which cost about $1,300. They’ve turned instead to a cheap speaker to stream music for their daughter’s bedtime.

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Evans is among a legion of unhappy customers who are upset with Santa Barbara-based Sonos. Today, the company is still trying to mitigate the fallout from the app debacle and salvage its reputation as a powerhouse in the audio industry offering an array of portable, high-quality wireless speakers. The hit to Sonos’ brand has swung the door open for rivals such as Amazon, Bose, Apple and other tech giants that make smart speakers to capture more of the business’ customers.

“Sonos knows it is on precarious ground because while it has built up customer goodwill, it plays in a highly competitive space,” said Dipanjan Chatterjee, vice president and principal analyst at research firm Forrester in an email.

Over its more than 20 years, the publicly traded company has weathered tough times before, including the 2008 financial crisis. But its latest misstep is a multimillion-dollar blunder that has forced it to delay the launch of new products and lower sales projections for the pivotal final months of the year when they otherwise would be looking to capitalize on a holiday sales boost.

Sonos said it’s spending $20 million to $30 million to fix the app and provide more customer support — an emergency investment it hopes will win back the trust of customers and steady its financial footing. In the last six months, the company’s stock, which ended trading Thursday at $11.58, has fallen 39%. In the quarter ending June 29, it reported $397 million in revenue, a 6% increase over the same period last year, and $3.7 million in net income.

This week, the company outlined a plan to make sure it doesn’t have similar failures in the future, including improvements to how it tests products before they’re released, the appointment of a “quality ombudsperson,” creation of a customer advisory board, and extending its warranty for certain items, such as its home theater and plug-in speaker products. Executives agreed to forgo their annual bonuses for 2025 unless their turnaround plan succeeds.

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“There are many wonderful brands that have made missteps, have gone out and apologized to fix things and won back the trust of their customers,” said Eddie Lazarus, Sonos’ chief strategy officer. “We’re going to be the next one in that line.”

Sonos was founded in 2002 by a group of entrepreneurs who set out to build something that is commonplace today but pioneering at the time: a wireless audio system that would enable people to play music over the internet anywhere in their home. They were working years before the start of popular streaming services such as Spotify and Pandora, as well as the launch of the iPhone.

In January 2005, the company released the ZP100, a device with a remote control that allowed people to stream music through their computers. The product garnered positive reviews including from Walt Mossberg, a tech columnist at the Wall Street Journal, who called the Sonos music streaming system “easily the best music-streaming product I have seen and tested.”

As in many startups, Sonos executives were worried about competitors . The first song played publicly on the ZP100 was the Beastie Boys’ “No Sleep Till Brooklyn,” a tune engineers could relate to as they hustled to improve the quality of the device before its release.

Appearing on the podcast “How I Built This with Guy Raz” this year, one of the founders, John MacFarlane, recalled the pressure he and others felt to unveil their first product in time for the holiday season — a goal they ultimately missed. Releasing the ZP100 before it was ready would have “killed the company,” he said.

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“You had to have a great positive first experience if you’re going to build the brand on word of mouth,” MacFarlane said.

The challenge of striking a balance between moving fast and having a good product is still a challenge that Sonos and other tech companies have grappled with throughout their history. Apple faced backlash from its customers in 2012 when it released a Maps app that contained inaccurate driving directions, Chatterjee said. But Sonos is in a “trickier” spot because the app is part of what makes the company’s audio system function seamlessly for the 15 million households that use its products globally.

“Without that seamlessness, there is no ease of use, and without the ease of use, the company cannot command its premium price with consumers or its premium position in the market,” he said.

Sonos Chief Executive Patrick Spence has acknowledged that the company has let down its customers. He told investors in August after Sonos released its quarterly earnings that the company had to rebuild the app to address “performance and reliability issues” and position the company for growth as the company expands “into new categories and move ambitiously outside of the home.” Sonos released its first pair of headphones in June.

For some Sonos customers like Evans, Sonos’ response has been “tone deaf,” underscoring the trust the company still needs to win back.

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“Why on earth would I care about a quality ombudsman? I’m a guy sitting in Melbourne nursing a baby in Australia with a speaker that doesn’t work,” he said.

Despite looking at the possibility of bringing back the previous version of the Sonos app, Lazarus said the company ruled it out because there were a lot of “technical concerns.” While the company has said it’s reintroduced many of the features from the old version of the app that were missing in the new one, he acknowledged the company still has work to do. He couldn’t say when the app will be completely fixed.

Other customers have found workarounds to still stream their music from their Sonos speakers even if the app doesn’t work.

Fearing issues with the rollout of the new app, 32-year-old product designer Matthew Mocniak said, he disabled his Sonos system from automatically updating the app but the solution worked only temporarily.

Mocniak, who lives in North Carolina and has spent more than $2,000 on Sonos speakers, said he’s able to stream music through Apple’s Airplay feature.

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As someone who works in the tech industry, Mocniak knows rebuilding software can be harder than it looks. “It’s very easy to promise certain features or certain deadlines,” he said. “It’s also easy to forget that there are people responsible for that stuff on the other side.”

Ben Brown, a 49-year-old creative director in the United Kingdom, said his Sonos app still says his speakers are not connected. Instead, he’s been using Amazon’s Alexa assistant to play music on the speakers.

Brown, who also purchased multiple Sonos speakers for his home, said he was so frustrated that he felt the urge to throw the Sonos Roam portable speaker in the sea while on vacation.

“I would never have done it, really, but that’s how angry it makes you,” he said. “It’s those moments where you just want to take a speaker outside, eat some dinner and listen to some music.”

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Why companies are making this change to their office space to cater to influencers

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Why companies are making this change to their office space to cater to influencers

For the trendiest tenants in Hollywood office buildings, it’s the latest fad that goes way beyond designer furniture and art: mini studios

To capitalize on the never-ending flow of stars and influencers who come through Los Angeles, a growing number of companies are building bright little corners for content creators to try products and shoot short videos. Athletic apparel maker Puma, Kim Kardashian’s Skims and cheeky cosmetics retailer e.l.f. have spaces specifically designed to give people a place to experience and broadcast about their brands.

Hollywood, which hasn’t historically been home to apparel companies, is now attracting the offices of fashion retailers, says CIM Group, one of the neighborhood’s largest commercial property landlords.

“When we’re touring a space, one of the first items they bring up is, ‘Where can I build a studio?’” said Blake Eckert, who leases CIM offices in L.A.

Their studio offices also serve as marketing centers, with showrooms and meeting spaces where brands can host proprietary events not open to the public.

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“For companies where brand visibility is really important, there is a trend of creating spaces that don’t just function as offices,” said real estate broker Nicole Mihalka of CBRE, who puts together entertainment property leases and sales.

Puma’s global entertainment marketing team is based in its new Hollywood offices, which works with such musical celebrity partners as Rihanna, ASAP Rocky, Dua Lipa, Skepta and Rosé, said Allyssa Rapp, head of Puma Studio L.A.

Allyssa Rapp, director of entertainment marketing at Puma, is shown in the Puma Studio L.A. The company keeps a closet full of Puma products on hand to give VIP guests. Visits to the studio sanctum are by invitation only, though.

(Kayla Bartkowski / Los Angeles Times)

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Hollywood is a central location, she said, for meeting with celebrities, stylists and outside designers, most of whom are based in Los Angeles.

The office is a “creation hub,” she said, where influencers can record Puma’s design prototyping lab supported by libraries of materials and equipment used to create Puma apparel. The company, founded in 1948, is known for its emblematic sneakers such as the Speedcat and its lunging feline logo, and makes athletic wear, accessories and equipment.

Puma’s entertainment marketing team also occupies the office and sometimes uses it for exclusive events.

“We use the space as a showroom, as a social space that transforms from a traditional workplace into more of an experiential space,” Rapp said.

Nontraditional uses include content creation, sit-down dinners, product launches, album listening parties and workshops.

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“Inviting people into our space and being able to give them high-touch brand experiences is something tangible and important for them,” she said. “The cultural layer is really important for us.”

The company keeps a closet full of Puma products on hand to give VIP guests. Visits to the studio sanctum are by invitation only, though. There’s no retail portal to the exclusive Hollywood offices.

Puma shoes are on display in the Puma Studio L.A.

Puma shoes are on display in the Puma Studio L.A.

(Kayla Bartkowski / Los Angeles Times)

Puma is also positioning its L.A studio as a connection point for major upcoming sporting events coming to Los Angeles, including the World Cup this summer, the 2027 Super Bowl and 2028 Olympics.

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In-office studios don’t need to be big to be impactful, Mihalka said. “These are smaller stages, closer to green screen than a massive soundstage.”

Social media is the key driver of content created by most businesses, which may set up small booth-like stages where influencers can hawk hot products while offering discounts to people watching them perform.

Bigger, elevated stages can accommodate multiple performers for extended discussions in front of small audiences, with towering screens behind them to set the mood or illustrate products.

Among the tricked-out offices, she said, is Skims. The company, which is valued at $5 billion, is based in a glass-and-steel office building near the fabled intersection of Hollywood Boulevard and Vine Street.

The fashion retailer declined to comment on the studio uses in its headquarters, but according to architecture firm Odaa, it has open and private offices, meeting rooms, collaboration zones, photo studios, sample libraries, prototype showrooms, an executive lounge and a commissary for 400 people.

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Pieces of a shoe sit on a workbench in the Puma Studio L.A.

Pieces of a shoe sit on a workbench in the Puma Studio L.A.

(Kayla Bartkowski / Los Angeles Times)

The brands building studios typically want to find the darkest spot on the premises to put their content creation or podcast spaces, Eckert said, where they can limit outside light and sound. That’s commonly near the center of the office floor, far from windows and close to permanent shear walls that limit sound intrusion.

They also need space for green rooms and restrooms dedicated to the talent.

Spotify recently built a fancy podcast studio in a CIM office building on trendy Sycamore Avenue that is open by invitation-only to video creators in Spotify’s partner program.

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“Ambitious shows need spaces that support big ideas,” Bill Simmons, head of talk strategy at Spotify, said in a statement. “These studios give teams room to experiment and keep pushing what’s possible.”

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A new delivery bot is coming to L.A., built stronger to survive in these streets

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A new delivery bot is coming to L.A., built stronger to survive in these streets

The rolling robots that deliver groceries and hot meals across Los Angeles are getting an upgrade.

Coco Robotics, a UCLA-born startup that’s deployed more than 1,000 bots across the country, unveiled its next-generation machines on Thursday.

The new robots are bigger, tougher and better equipped for autonomy than their predecessors. The company will use them to expand into new markets and increase its presence in Los Angeles, where it makes deliveries through a partnership with DoorDash.

Dubbed Coco 2, the next-gen bots have upgraded cameras and front-facing lidar, a laser-based sensor used in self-driving cars. They will use hardware built by Nvidia, the Santa Clara-based artificial intelligence chip giant.

Coco co-founder and chief executive Zach Rash said Coco 2 will be able to make deliveries even in conditions unsafe for human drivers. The robot is fully submersible in case of flooding and is compatible with special snow tires.

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Zach Rash, co-founder and CEO of Coco, opens the top of the new Coco 2 (Next-Gen) at the Coco Robotics headquarters in Venice.

(Kayla Bartkowski/Los Angeles Times)

Early this month, a cute Coco was recorded struggling through flooded roads in L.A.

“She’s doing her best!” said the person recording the video. “She is doing her best, you guys.”

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Instagram followers cheered the bot on, with one posting, “Go coco, go,” and others calling for someone to help the robot.

“We want it to have a lot more reliability in the most extreme conditions where it’s either unsafe or uncomfortable for human drivers to be on the road,” Rash said. “Those are the exact times where everyone wants to order.”

The company will ramp up mass production of Coco 2 this summer, Rash said, aiming to produce 1,000 bots each month.

The design is sleek and simple, with a pink-and-white ombré paint job, the company’s name printed in lowercase, and a keypad for loading and unloading the cargo area. The robots have four wheels and a bigger internal compartment for carrying food and goods .

Many of the bots will be used for expansion into new markets across Europe and Asia, but they will also hit the streets in Los Angeles and operate alongside the older Coco bots.

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Coco has about 300 bots in Los Angeles already, serving customers from Santa Monica and Venice to Westwood, Mid-City, West Hollywood, Hollywood, Echo Park, Silver Lake, downtown, Koreatown and the USC area.

The new Coco 2 (Next-Gen) drives along the sidewalk at the Coco Robotics headquarters in Venice.

The new Coco 2 (Next-Gen) drives along the sidewalk at the Coco Robotics headquarters in Venice.

(Kayla Bartkowski/Los Angeles Times)

The company is in discussion with officials in Culver City, Long Beach and Pasadena about bringing autonomous delivery to those communities.

There’s also been demand for the bots in Studio City, Burbank and the San Fernando Valley, according to Rash.

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“A lot of the markets that we go into have been telling us they can’t hire enough people to do the deliveries and to continue to grow at the pace that customers want,” Rash said. “There’s quite a lot of area in Los Angeles that we can still cover.”

The bots already operate in Chicago, Miami and Helsinki, Finland. Last month, they arrived in Jersey City, N.J.

Late last year, Coco announced a partnership with DashMart, DoorDash’s delivery-only online store. The partnership allows Coco bots to deliver fresh groceries, electronics and household essentials as well as hot prepared meals.

With the release of Coco 2, the company is eyeing faster deliveries using bike lanes and road shoulders as opposed to just sidewalks, in cities where it’s safe to do so. Coco 2 can adapt more quickly to new environments and physical obstacles, the company said.

Zach Rash, co-founder and CEO of Coco.

Zach Rash, co-founder and CEO of Coco.

(Kayla Bartkowski/Los Angeles Times)

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Coco 2 is designed to operate autonomously, but there will still be human oversight in case the robot runs into trouble, Rash said. Damaged sidewalks or unexpected construction can stop a bot in its tracks.

The need for human supervision has created a new field of jobs for Angelenos.

Though there have been reports of pedestrians bullying the robots by knocking them over or blocking their path, Rash said the community response has been overall positive. The bots are meant to inspire affection.

“One of the design principles on the color and the name and a lot of the branding was to feel warm and friendly to people,” Rash said.

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Coco plans to add thousands of bots to its fleet this year. The delivery service got its start as a dorm room project in 2020, when Rash was a student at UCLA. He co-founded the company with fellow student Brad Squicciarini.

The Santa Monica-based company has completed more than 500,000 zero-emission deliveries and its bots have collectively traveled around 1 million miles.

Coco chooses neighborhoods to deploy its bots based on density, prioritizing areas with restaurants clustered together and short delivery distances as well as places where parking is difficult.

The robots can relieve congestion by taking cars and motorbikes off the roads. Rash said there is so much demand for delivery services that the company’s bots are not taking jobs from human drivers.

Instead, Coco can fill gaps in the delivery market while saving merchants money and improving the safety of city streets.

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“This vehicle is inherently a lot safer for communities than a car,” Rash said. “We believe our vehicles can operate the highest quality of service and we can do it at the lowest price point.”

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Trump orders federal agencies to stop using Anthropic’s AI after clash with Pentagon

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Trump orders federal agencies to stop using Anthropic’s AI after clash with Pentagon

President Trump on Friday directed federal agencies to stop using technology from San Francisco artificial intelligence company Anthropic, escalating a high-profile clash between the AI startup and the Pentagon over safety.

In a Friday post on the social media site Truth Social, Trump described the company as “radical left” and “woke.”

“We don’t need it, we don’t want it, and will not do business with them again!” Trump said.

The president’s harsh words mark a major escalation in the ongoing battle between some in the Trump administration and several technology companies over the use of artificial intelligence in defense tech.

Anthropic has been sparring with the Pentagon, which had threatened to end its $200-million contract with the company on Friday if it didn’t loosen restrictions on its AI model so it could be used for more military purposes. Anthropic had been asking for more guarantees that its tech wouldn’t be used for surveillance of Americans or autonomous weapons.

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The tussle could hobble Anthropic’s business with the government. The Trump administration said the company was added to a sweeping national security blacklist, ordering federal agencies to immediately discontinue use of its products and barring any government contractors from maintaining ties with it.

Defense Secretary Pete Hegseth, who met with Anthropic’s Chief Executive Dario Amodei this week, criticized the tech company after Trump’s Truth Social post.

“Anthropic delivered a master class in arrogance and betrayal as well as a textbook case of how not to do business with the United States Government or the Pentagon,” he wrote Friday on social media site X.

Anthropic didn’t immediately respond to a request for comment.

Anthropic announced a two-year agreement with the Department of Defense in July to “prototype frontier AI capabilities that advance U.S. national security.”

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The company has an AI chatbot called Claude, but it also built a custom AI system for U.S. national security customers.

On Thursday, Amodei signaled the company wouldn’t cave to the Department of Defense’s demands to loosen safety restrictions on its AI models.

The government has emphasized in negotiations that it wants to use Anthropic’s technology only for legal purposes, and the safeguards Anthropic wants are already covered by the law.

Still, Amodei was worried about Washington’s commitment.

“We have never raised objections to particular military operations nor attempted to limit use of our technology in an ad hoc manner,” he said in a blog post. “However, in a narrow set of cases, we believe AI can undermine, rather than defend, democratic values.”

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Tech workers have backed Anthropic’s stance.

Unions and worker groups representing 700,000 employees at Amazon, Google and Microsoft said this week in a joint statement that they’re urging their employers to reject these demands as well if they have additional contracts with the Pentagon.

“Our employers are already complicit in providing their technologies to power mass atrocities and war crimes; capitulating to the Pentagon’s intimidation will only further implicate our labor in violence and repression,” the statement said.

Anthropic’s standoff with the U.S. government could benefit its competitors, such as Elon Musk’s xAI or OpenAI.

Sam Altman, chief executive of OpenAI, the company behind ChatGPT and one of Anthropic’s biggest competitors, told CNBC in an interview that he trusts Anthropic.

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“I think they really do care about safety, and I’ve been happy that they’ve been supporting our war fighters,” he said. “I’m not sure where this is going to go.”

Anthropic has distinguished itself from its rivals by touting its concern about AI safety.

The company, valued at roughly $380 billion, is legally required to balance making money with advancing the company’s public benefit of “responsible development and maintenance of advanced AI for the long-term benefit of humanity.”

Developers, businesses, government agencies and other organizations use Anthropic’s tools. Its chatbot can generate code, write text and perform other tasks. Anthropic also offers an AI assistant for consumers and makes money from paid subscriptions as well as contracts. Unlike OpenAI, which is testing ads in ChatGPT, Anthropic has pledged not to show ads in its chatbot Claude.

The company has roughly 2,000 employees and has revenue equivalent to about $14 billion a year.

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