June 1, 2016

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Why Home Security is Key to Unlocking the Smart Home’s Potential

As far back as 1950, General Electric unveiled its vision of the 21st century home, with a kitchen complete with pop-up fridge, plastic plate maker and ultrasonic dishwasher.

For decades there have been many demonstrations of future smart homes and multiple commercial offerings have been brought to market, envisioning a higher degree of automation in different areas of our homes.  They range from the US animated sitcom The Jetsons to the more recent advent of smart fridges from the likes of Electrolux, Samsung and LG.

Yet, for the most part, despite consumers’ general interest in the concept of the smart home, they have all failed to gain acceptance in the mass market, especially smart fridges!

Deutsche Telekom’s analysis shows that some of the principle reasons for this have been due to the failure to meet real consumer needs, pain points, fears, worries…  And that’s where, Deutsche Telekom believes, the home security market will clearly have a major influence on driving growth in this market.

A recent study by CONTEXT found that consumers in Europe’s five largest markets are increasingly ‘worried’ about their home when they are not there.  And with the mass adoption of smartphones, home broadband and new wireless sensor and camera technology, consumers increasingly understand that there is technology available that could overcome their fears and give them greater peace of mind.

Source: CONTEXT survey. Dec 2015: 2,500 consumers in France, Germany, UK, Spain & Italy

Source: CONTEXT survey. Dec 2015: 2,500 consumers in France, Germany, UK, Spain & Italy

Here are some typical consumer needs and pain points:

  • “I often need to be in more than one place at the same time, so I can’t keep an eye on the kids and know whether they’ve got home safely”
  • “Home security helps me have greater peace of mind, especially when it comes to the safety and security of my loved ones, especially our children”
  • “I want to know that everything is alright at home, and especially those things that are most important to us”
  • “I need some means of keeping an eye on my holiday home…it’s not just about security, it’s about being alerted if there is a burst pipe when the heating fails etc….”

The levels of adoption of home security and safety-based propositions vary noticeably by country, region and segment; as does consumers’ readiness to accept more advanced forms of security. Currently, across Europe, according to the EU Crime Prevention Monitor, an average of ten percent of homes has some form of security alarm.

However, based on Strategy Analytic’s quantitative research, monitored alarms systems protect on average of just six percent of the total housing stock across Europe. The strongest growth has been in the Nordics.

In Finland, penetration grew from 2% in 1989 to 9% in 2004, while Norway jumped from 9% to 28% over the same period. In addition, there are many self-installed systems which just ring, or alert the householder.

According to the 2012 English Housing Survey, 30% of households had some form of alarm (both professionally monitored and self-installed), up from 25% in 2001. And the forecast for growth over the coming again varies widely (see market forecast).

However, according to Berg Insight, growth in home security alarms could well exceed current market forecasts due to consumers’ increasing fear of crime.

The author is talking about how security businesses can transform their offering through home automation on 23 June at IFSEC International 2016. Register for IFSEC here.

 

Source: Strategy Analytics’ 2016 Smart Home Systems And Services Forecast & Berg 2016 Security Applications & Wireless M2M

Source: Strategy Analytics’ 2016 Smart Home Systems And Services Forecast & Berg 2016 Security Applications & Wireless M2M

Despite the different levels of adoption across different regions of Europe, the EU remains significantly behind the US, where adoption of monitored alarm systems range from 17 to 26 percent, according to different market reports. One of the key factors effecting the home security market in the US, beyond just the maturity of the market, gun crime, the role of the sheriff in the response to alarm events, etc, has been the active involvement of telecom operators.

In the US, every telco offers some form of professional monitored home security proposition.  Depending on the operator, the service might be installed by professional or do-it-yourself, but the service proposition is similar.

However, what is clear is that telcos have helped to drive the market, especially over recent years.  The other interesting factor has been that increasingly consumers, who in the past relied on dedicated home security providers, are increasingly turning to the telecoms provider, as the provider of choice for security.

Source: Deutsche Telekom analysis

Source: Deutsche Telekom analysis

Today, European consumers face a complex choice: either a  self-install, self-monitored home security solution, with multiple drawbacks in terms of the ability to respond in the event of an incident, or mid-value consumer electronics-branded camera solutions, again with limited ability to take action, or costly professional monitoring solutions, of which many actually offer no guaranteed response.

It is also clear that much of what has held the market back over the last few years is now being overcome in terms of the lack of pervasive distribution, i.e.: availability in high street stores; the simplicity of the offer; lack of transparency in the pricing, true mass market pricing (not just aimed at high net worth individuals!), as well as the flexibility of pricing; the complexity of set-up; and the challenge of responding to an emergency situation, etc.

The use cases that interest consumers mostly range from the remote monitoring of the home via cameras and the ability to remotely open and close doors to being alerted at the event of power outage, leak or flood event, fire or during severe weather, such as freezing conditions.

We believe that the market potential for interactive monitored home security alarms is significant and represents one of the most attractive routes into the smart home market.  Whilst it is an established market answering clear consumer needs, current industry models are not working.

Prices are too high and the services are too inflexible. For example, some people might only want monitoring when they are on holiday, where others will want it whenever they leave their home.

There is also a lack of distinct lack of availability on the high street. But more than that, many consumers don’t just want home security, they also want the ability to add multiple other devices to such a system, from their Sonos sound bar to their smart light bulbs, any HD camera they so desire and so on.  Today’s consumers don’t just want the basic alarm system that might have been installed in the past – they want things to work together, to interconnect.

We also believe that consumers today want to have different types and levels of response, not just a man and van.

One innovative approach can be found in Norway, with the successfully deployment of Sfty, a social community network.  The system alerts not only the authorities, but also friends, family and neighbours, in the case of an alarm.

A rapid response can be a key means of limiting the damage or loss, and in less serious situations – where emergency responders may not prioritize a fast response – those who are in close proximity to your home and family are more likely to be relied upon.  This social safety network is a new connected take on the old neighbourhood watch concept, and has the potential to transform home security.

In the US, nextdoor.com is another example of how a social networking service for neighbourhoods is allowing users to connect with people who live nearby, particularly in emergency situations.

There is no doubt that in the realization of such services, many players notably, telcos, as well as insurers and retailers, have a strong role to play, as they bring a level of trust and credibility to such propositions and can also support the realization of more innovative business models.

Today, Deutsche Telekom offers other telcos, including KPN in the Netherlands, and its own consumer business in Germany, a fully white label open smart home capability, which – beyond enabling a smart home proposition – provides the basis for interactivity home security, via IP cameras and a range of connected sensors.

Importantly, Deutsche Telekom has adopted open source software from Eclipse SmartHome, and is actively building a developer community, as a means to speed up the adoption of innovative features and functions.

To drive growth in this market, we believe telcos and the security industry need to work in partnership.  No one company can assemble all the pieces of the intricate smart home and home security puzzle.  Partnering will be essential.

The smart home market will change how anyone selling products and services to consumers for and into their homes does business.  New technologies have a way of doing this and there are many new advancements nurturing this nascent market and many companies with different strengths addressing the opportunities.

Deutsche Telecom’s slogan is: ‘Life’s for sharing’. And in the context of the smart home, perhaps it should rather be ‘business is for partnering’.

Jon Carter, UK head of business development for the connected home at Deutsche Tekekom UK AG, will be talking about how security businesses can transform their offering through home automation at IFSEC International 2016.

Jon’s presentation will take place on 23 June, 11.00-11.50 in IFSEC’s Smart Theatre at ExCel LondonRegister for IFSEC here.

 

 

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sfty_ Smart Multisensor
June 1, 2016 12:59 pm

I know SFTY.com from Norway very well ;-), and just to add a little more about the smart concept: As mentioned above, safety is the most appealing way for the consumers to enter the smart home, and all surveys show that saving lives and peace of mind is the most important. For saving lives, smoke detection and early warning to family and friends is the most important, and sfty focus here: – By downloading the sfty app, you have instant “personal safety”, by bulding your safety network of family friends and neighbours. – Then you can add the hardware multisensor.… Read more »

sfty_ Smart Multisensor
June 1, 2016 1:02 pm

Peace of mind if you are a landlord or MDU owner. If the sfty system is
installed in an MDU, the landlord can connect from anywhere in the
world to the MDU admin portal, and see that all devices in both apartments and common areas are
up and running, both on wifi, radio and with batteries.

sfty_ Smart Multisensor
June 1, 2016 1:26 pm

Another smart feature with this concept is the option for MDU landlords.
If the sfty system is
installed in an MDU, the landlord can connect from anywhere in the
world, and see that all devices in both apartments and common areas are
up and running, both on wifi, radio and with batteries.

ewisner1973
ewisner1973
June 15, 2016 3:03 am

Have you heard of this new DIY security company called Home8. Just like the article stated that consumers in Europe’s five largest markets are increasingly ‘worried’ about their home when they are not there. And with the mass adoption of smartphones, home broadband and new wireless sensor and camera technology, consumers increasingly understand that there is technology available that could overcome their fears and give them greater peace of mind. Apparently Home8 can manage up to 30+ devices all under one mobile app and you can add multiple users to this account and monitor multiple locations too! It’s no monthly… Read more »