New data fromJuniper Researchhas found that home automation hardware, sold as standalone units rather than as part of a subscription package, will exceed 300 million in 2020. This represents growth of over 1,000 percent from an estimated installed base of 28 million units in 2015.
While the smart home industry has been years in the making, more open approaches, partnerships and falling hardware costs are driving adoption. Furthermore, media and retail efforts are aiding in raising consumer awareness.
The new research,Smart Home Ecosystems & the Internet of Things: Strategies & Forecasts 2015-2020, found that early piecemeal hardware efforts simply created isolated smart automation units. Open platform efforts, such as those championed by SmartThings and Wink have nevertheless driven more cohesive ecosystems. Meanwhile Deutsche Telekoms open platform, Qivicon, demonstrates a shift in attitude even for incumbent service providers, who traditionally prefer total control over their services.
Theres light at the end of the tunnel noted research author Steffen Sorrell. Open approaches certainly help move the connected home towards a smarter one. However, the consumer still needs to be convinced: that will be the job of retail to solve, and thats a question of educating both employee and consumer.
The research found that, due to the lack of consumer understanding of the smart home value proposition, retail is to play a crucial role. Indeed, efforts such as Targets Open House; a smart home demonstration centre; offer consumers a show and tell and rapid understanding of the benefits of the smart home. Nevertheless, retail continues to grapple with effective product placement, staff education and the fact that many brands remain unfamiliar to consumers.
Other key findings
- The dominant home automation business model will not veer towards subscriptions until sufficient hardware is in place to build smart services on top.
- Major smart home players looking to reach the global market are failing to address local market demands, hampering their progress.