How Sonos Botched an App and Infuriated Its Customers
Earlier this summer, amid a crisis, the chief executive officer of Sonos Inc., Patrick Spence, turned to Eddie Lazarus, the company’s lead counsel, and asked him to undertake what the company has called a “deep dive” and “reflection” into the events leading up to the launch of its new app in May.
A better term might be “postmortem.” The update has become one of the most disastrous software releases by any consumer technology company in recent memory. In any corner of the internet where customers have a space to speak their minds, the anger at Sonos is raucous.
In an interview, Lazarus said he had finished the job. “It’s more than a few pages, but not quite the tomes that I wrote in my youth,” he said, referencing his hefty law books, most notably his insider account of the US Supreme Court, where in the 1980s he was a clerk to Justice Harry Blackmun.
Lazarus interviewed around two dozen key employees and reviewed recordings of old meetings before presenting his report to Spence and the company’s board at the end of July. Lazarus declined to disclose its contents. But having spent the past couple of weeks talking to company sources, I think I have a pretty good idea of at least some of its conclusions.
To recap, in May, the premium audio brand launched its new app — the software customers use to set up and manage their speakers — knowing that core functionality was either missing or faulty. Upon release, reports of even more bugs came in thick and fast. The fallout has been so drastic that the company has said it will fall $200 million short of its annual revenue target. As I wrote last month, it has also postponed two new products until the problems are fixed, which is still expected to take months. Sonos shares are down 25% this year.
In a video message to staff earlier this month, obtained by Bloomberg, Spence said the findings of the Lazarus report would inform the creation of new “commitments” for the company. “We fully intend to enshrine the lessons coming out of this difficult chapter,” he said before telling employees that yearly bonuses and merit-based pay raises had been canceled.
What has happened to Sonos is at its heart a cautionary tale of company leadership ignoring the perils of “technical debt,” the term used by software engineers to describe the compounding threat of outdated code and infrastructure on security, usability and stability.
For two decades, Sonos had allowed its tech debt to pile high. When it undertook in earnest its effort to revamp its app in mid-2022, the company knew it was sitting on infrastructure and code written in languages that were pretty much obsolete. The Sonos app had been adapted and spliced and tinkered with so often, the vast majority of work being performed for the new app was less about introducing new functionality than sorting out the existing mess.
The company could have tackled its tech debt sooner but appears to have lacked a crucial element: urgency. It finally came in the form of the Sonos Ace headphones, the first product in the Sonos range to be fully mobile rather than using home or office Wi-Fi. The app needed to be rebuilt, as did the cloud computing setup underpinning it.
Ace is a critical product for Sonos. Now that Sonos’ pandemic sales boom has subsided, Wall Street has started to question where revenue growth will come from. Sonos Ace is a big part of the answer. Despite the company’s lofty and well-earned reputation, Sonos’ share of the $100 billion audio market is only around 2% because it has not gone toe-to-toe in the headphones category with Apple, Sennheiser, Bose and the rest.
Spence told investors he was ready to accelerate development with “at least two new products every year.” At the same time, he pledged to keep expenses low. That has meant layoffs, first in June 2023 and then again in August. Among those laid off were members of the company’s quality-assurance teams.
Alongside the cuts, a company reorganization led by its chief product officer, Maxime Bouvat-Merlin, was causing chaos, two former employees said. “They separated people that had been working together for years creating great products,” a former engineer said. “I don’t understand what could motivate someone to shake things up like that.” (Lazarus said issues around the reorganization were examined in his report.)
As the app’s launch date drew near, frustrations boiled over. It had become clear the app was far from ready. Sonos employees, many of whom were fans before joining the company, started to directly and forcefully raise the alarm with Spence and other executives, according to three current and former employees. They described “yelling” and “screaming” in meetings.
They worried Sonos’ drive to attract new customers, and Spence’s promises to investors, were taking precedence over ensuring equipment already owned by longtime loyal customers would continue to function as expected. “That was the thing that pushed them to ignore those other concerns,” a former senior employee told me. “They thought they were making such a big, bold decision. It was the wrong decision.”
In one meeting, according to two people who witnessed it, an employee involved in the app’s development said they feared that pushing back harder on senior leadership would jeopardize their job. (The person was among those recently laid off, according to LinkedIn.)
Lazarus disputes any suggestion a breakdown in culture was to blame for the lackluster app seeing the light of day. He said the company did heed some warnings when it delayed the app’s original launch date from early 2024 until May. He said he hadn’t witnessed any “yelling” or “screaming” in meetings himself but added: “I think sharp disagreements over things like that can be healthy, as long as they are resolved in a way that keeps an eye on the customer experience.”
Lazarus said the company had a list of what were regarded as “essential” bugs that needed to be fixed before launch. Bugs it deemed to be less critical, or functionality it felt could be left off temporarily, would be dealt with after the launch. When I asked if it was possible the company’s idea of an “essential” bug might have differed from what customers considered vital functionality, Lazarus paused before saying: “Our list of essential bugs, obviously, was not comprehensive enough.”
Employees are angry — though, somewhat to my surprise, they don’t seem to be calling for Spence’s head. The sharply dressed Canadian has been on what one employee called an “apology tour,” visiting several of the company’s offices and reassuring employees that he was on top of things. Those I spoke to felt further leadership upheaval would only slow things down. The company is doing rolling updates to the app every two weeks, with the goal to reach feature parity with the old app fairly soon (though the reputational harm will linger longer).
It helps that Spence has put himself in the firing line of public feedback in places like Reddit, where he took questions, and at a recent conference for professional home tech installers. Taking a page from Amazon.com Inc. founder Jeff Bezos’ playbook, Spence has an email address that lets customers email him directly with complaints and feedback. Most are handled by support teams, but I’m told he does personally engage at times.
He used to get few dozen a week. Since May, there have been more than 30,000, a source told me. Patience is running out — this cautionary tale does not yet have its ending.
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