Apple is bringing its HomePod to new markets (AAPL)

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Apple will start selling its HomePod smart speaker in Canada, France, and Germany in mid-June, according to TechCrunch. Additionally, the tech giant released a number of upgrades to its iOS software that add key functionality to the smart speaker, which could buoy consumer interest and lead to increased sales. These moves are aimed at expanding the reach and allure of the HomePod, as the smart speaker remains behind its primary competition, Amazon’s Echo and Google’s Home, in both sales and versatility.

Apple stumbled out of the gate with the HomePod — it announced the device nearly a year ago, but failed to ship units until this past February.As of now, the speaker is only available in the US, UK, and Australia, which pales in comparison to the 89 countries where consumers can buy an Echo and trails Google’s Home, as well.

Sales reports have also been lackluster, with the device making up just 10% of smart speaker sales and 19% of revenue in early 2018. Business Insider Intelligence projected the HomePod could competewith the Echo when Apple first announced the device, if the company followed through on announced timelines.

Updates to the company’s iOS software could help bring the HomePod into competition with Amazon's and Google’s devices. The HomePod will now support stereo audio pairing, allowing consumers who buy two or more of the $349 speakers to use them in tandem with software that optimizes audio output and coordinates it across the devices — a feature Apple discussed extensively when it introduced the speaker last June. Amazon's and Google’s speakers both already support multiroom and multispeaker audio.

Next week marks the one-year anniversary of the HomePod’s first announcement, and Apple could speak to how it will further update the speaker or change its approach to the market:

• There’s been some speculation that Apple could release a lower-priced version of the HomePod, possibly incorporating Beats branding, at its Worldwide Developer Conference next week. The company likely won’t aim to compete with Amazon and Google at the low end of the market — where consumers can buy the Echo Dot or Home Mini for as low at $29 during sales — but its sole product costs far more than other options on the market, except for Google’s Home Max.
• Apple’s speaker still does not feature any framework for third-party voice apps like Alexa skills, nor does it support streaming music content from any third-party sources like Spotify or Pandora. For companies looking to reach consumers through the smart speaker, there aren’t many ways to work with Apple’s device and use it as a conduit toward an audience. Apple needs to address this issue if it wants to add partners that will also seek to get consumers to buy and use its smart speaker.

Smart speakers — Amazon's Echo, for example — are the latest device category poised to take a chunk of our increasingly digital lives. These devices are made primarily for the home and execute a user's voice commands via an integrated digital assistant. These digital assistants can play music, answer questions, and control other devices within a user's home, among other things. 

The central question for this new product category is not when they will take off, but which devices will rise to the top. To answer this question, Business Insider Intelligence, Business Insider's premium research service, surveyed our leading-edge consumer panel, gathering exclusive data on Amazon's recently released Echo Show and Echo Look, as well as Apple's HomePod. 

Business Insider Intelligence has put together a Smart Speaker report that analyzes the market potential of the Echo Look, Echo Show, and HomePod. Using exclusive survey data, this report evaluates each device's potential for adoption based on four criteria: awareness, excitement, usefulness, and purchase intent. Finally, the report draws some inferences from our data about the direction the smart speaker market could take from here.

Here are some of the key takeaways:

• Amazon's new Echo Show is the big winner — it has mass-market appeal and looks like it will take off. The combination of usefulness and excitement will drive consumers to buy the Echo Show. The Echo Look, though, seems like it will struggle to attract that same level of interest.
• Apple’s HomePod looks likely to find a place in the smart speaker market but won’t dominate its space like the iPhone or iPad did.
• The smart speaker market will evolve rapidly in the next few years, with more devices featuring screens, a variety of more focused products emerging, and eventually, the voice assistant moving beyond the smart speaker.

In full, the report:

• Showcases exclusive survey data on initial consumer reactions to the Echo Look, Echo Show, and HomePod.
• Highlights the aims and strategies of major players in the smart speaker market.
• Provides analysis on the direction this nascent market will take and the opportunity for companies considering a move into the space.

To get the full report, subscribe to an All-Access pass to Business Insider Intelligence and gain immediate access to this report and over 100 other expertly researched reports. As an added bonus, you'll also gain access to all future reports and daily newsletters to ensure you stay ahead of the curve and benefit personally and professionally. >> Learn More Now

You can also purchase and download the full report from our research store.

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