1. Which service is most likely to trigger mass market Smart Home take-up – security, entertainment, heating, health or something else?
Le Corbusier, the father of modern 20th century architecture, famously said “homes are machines to live in.” When it comes to our homes in the 21st century, we actually want different kinds of machines, depending on the different functions we need fulfilled in our lives. We’re seeing very seeing different drivers for Smart Home adoption in different territories. In the US for example, research shows that security is the primary reason homeowners adopt Smart Home systems, whereas in Europe, homeowners tend to be more driven by entertainment and energy efficiency. Smart Home providers need to get to know their consumers county by country, but also by other demographics including age and family type. A retired couple will have very different motivations for purchasing Smart Home solutions than a young family. Driving mass market adoption will require the Smart Home industry to respond to the diversity of households and recognise their different needs.
2. Where does potential lie for new industries to become involved in the Smart Home market?
One of the new industries that is beginning wake up to the Smart Home opportunity is Insurance. Clearly, a home that’s equipped with smart devices capable of recognising glass break and smoke alarms when the house is unoccupied presents a lower insurance risk than one that’s not. In the US, where the Smart Home market is most mature, Insurance players including State Farm and Liberty mutual have announced plans to offer discounts to customers who adopt Smart Home devices.
Here in the UK, Zurich is offering its customer a 10% discount on home insurance if they have a Cocoon IoT alarm installed. The great thing about the Insurance industry becoming involved is that they have the power to offer hundreds of millions of customers a financial incentive to deploy smart devices. Moreover, the hefty discounts Insurers are offering are tangible proof to consumers of how much these devices de-risk their property, providing another compelling reason to buy.
3. How are partnerships contributing to growth in the Smart Home market?
The most important partnership is the one between Smart Home manufacturers and providers, and retailers. Retailers have an incredibly important role to play, helping consumers navigate the growing number of solutions in the market place. Consumers want to buy joined up smarter living – not devices. Retailers need to step up and tell that story to their customers. We’re beginning to see some of them doing that. Target in the US have showcased compatible products grouped together around real life use-cases. John Lewis and Selfridges here in the UK are making tentative steps too with their Smart Home showcases but we’ve yet to see any retailer roll out a consumer-first sales approach in all stores and online.
4. How can security and privacy concerns be overcome?
Security and privacy are two concerns that need to be addressed by every player in the Smart Home space. The concerns consumers have are rational and well founded. In the rush to get to market early, some manufacturers cut corners. A number of early smart baby monitors were shown to be insecure and easily hackable. And we all heard the one about a major OEM, belatedly warning customers against talking about anything sensitive near their smart TVs! Well publicised oversights like these have undoubtedly shaken consumer confidence in the Smart Home. We need to show that the Smart Home industry addresses data security and privacy from first design principles all the way through to market deployment. Here at Audio Analytic, we made the decision very early on that people don’t want smart devices that constantly stream every sound from their home to the cloud for analysis. That’s why we designed our software to do all sound recognition on the device chip itself, ensuring complete peace of mind for the home owner and allowing our OEM partners to pass on that benefit to their customers.
5. Which retailers are achieving most success in Smart Home sales and why?
Target in the US is absolutely leading the way. For those of you who aren’t familiar with the US retail landscape, it’s the country’s second biggest retailer – just behind Walmart, with revenues of more than $70 billion. I recently visited Target’s Open House in San Francisco where it was clear they understand that it’s not enough to just sell connected devices – people want to buy smart living solutions, solutions that may include multiple different devices, working together seamlessly to deliver on a particular use case. The giant retailer is changing – from being in “marketing mode” to a more educational one that informs and inspires consumers. Their next challenge is figuring out how to take the dedicated experience at the Open House and scale it. When they do that, millions of US homeowners will follow their lead.
6. Is an OpenSource platform necessary for industry growth?
We’ve seen in the mobile space that people are happy to adopt and often stay loyal to a particular operating system ecosystem. The choice is as limited as it can be in mobile with essentially two main players dominating the entire ecosystem – iOS and Android. It’s not yet clear if that same division is going to migrate to the Smart Home space or whether we’ll see new platforms emerge and challenge. A certain degree of interoperability is essential but it’ll probably be down to individual OEMs to deliver devices that work across the main platforms.
About Smart Summit London
Smart Summit is a 2 day conference and exhibition covering the Internet of Things (IoT) ecosystem and its impact on the digital society.
With 3 in-depth event tracks and over 180 leading speakers, no other IoT event covers the Smart Home, Smart Cities and Industrial Internet of Things in as much detail.
Co-located with a joint networking exhibition, each track (summit) features over 20 unique and topical sessions – gain a unique insight from industry heavyweights and hear case study examples from major contributors.
Make sure you are present in London on the 21st and 22nd September for THE Smart event of 2016.