Adam Bannister

Editor, IFSEC Global

Author Bio ▼

Adam Bannister is editor of IFSEC Global. A former managing editor at Dynamis Online Media Group, he has been at the helm of the UK's leading fire and security publication since 2014.
October 13, 2015

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5 Barriers to Growth in the Home Automation Market and how they’ll be Overcome

honeywell smart home entry

Honeywell’s door entry system for homes

There’s a real belief in the IT and electronics industries that home automation, a concept actually coined many years ago, is on the brink of a breakthrough.

With high speed wi-fi now the norm, powerful smartphones ubiquitous and a host of internet-connectable gadgets appearing on the market, many of the obstacles to adoption have been overcome.

But clearly not all of them.

Because as smart home blogger Rose Thibodeaux wrote on IFSEC Global recently, demand for ‘smart home’ products in the US actually fell 15% between May 2014 and May 2015, according to a report by ArgusInsights.

And home automation, which broadly speaking means controlling everyday household items likes fridges, TVs and lights with your smartphone, tablet or PC, still remains the reserve of the affluent and, like the internet in its early days, technophiles.

So when is the explosion in take-up among the wider public going to happen? When will the only semi-IT-literate Joe Blogs start turning the oven on when he’s down the pub? Or checking on his pet dog via his smart surveillance camera and dispensing placatory treats from the iCPooch?

The answer depends largely on whether at least some of the following remaining barriers to adoption are overcome.

  1. Security fears

Surveillance cameras, window and door opening sensors, remote door locking and motion detectors – hitherto tools deployed only in business premises or public buildings – are now also affordable for, and marketed at, homeowners.

Likewise smart fire safety equipment, with remote alerts from smoke, carbon monoxide and water leak detectors promising lower insurance costs.

“Many service providers are starting off with security, because there’s an existing home security business model in place,” Michael Philpott, principal analyst at technology research firm Ovum, told the BBC. “In the UK about 30% of homes have some kind of home alarm, and about 10% of those pay monthly for a professional home security service.”

A host of start-ups have emerged to exploit the market, including Homeboy, Arlo, Canary, Dropcam and Piper, while established players in commercial security like ASSA Abloy, Honeywell and Siemens have launched their own smart home security solutions.

But if fear of crime and infrastructural readiness makes security an early growth segment, then fear of crime and infrastructural vulnerability also make security fears one of the biggest barriers.

Yes, cyber security concerns means that home automation actually introduces a risk where before there was none (PCs and laptops aside). Only by making Internet of Things (IoT) devices resilient against attacks and perhaps introducing fail-safe defaults to manual operation can these concerns be assuaged.

  1. Lack of interoperability

As yet there is little cross-industry agreement on common, open-source, technical standards. As the entire IoT concept is predicated on the idea of devices ‘talking to one another’, this is a huge problem.

Efforts to tackle this issue are being made – unfortunately these efforts are disparate.

Way back in 2004 broadband service providers set up the Home Gateway Initiative. In 2013, the Linux Foundation allied with Qualcomm, LG Electronics, Panasonic, Sharp and others to establish the AllSeen Alliance. The following year, Google’s Nest and Samsung were among the names behind Thread, while Intel, Samsung, and Dell have formed the Open Interconnect Consortium.

True to form Apple has eschewed the open platform option while Amazon is also going down the proprietary route.

“Anything that confuses the consumer will be a barrier,” says Philpott. “Consumers are only going to buy into the smart home if it makes their life much better or much cheaper. We’re not there yet.”

Wire-free video surveillance by Homeboy

Wire-free video surveillance by Homeboy

  1. The fiddle factor

The ArgusInsights report has noted that many IoT gadgets are difficult to use. The smart home market is still effectively in the teething stage and many devices still malfunction too easily.

One New York property developer told the Wall Street Journal that his expensive smart home system, which controlled everything from the lighting to the temperature of the swimming pool, broke about five times a year.

Switching the lights on and off is traditionally a simple task. To many consumers ‘smart’ lighting, dependent on “learning algorithms” to develop preferences and a digital interface prone to bugs, simply introduces needless complexity and hassle into their lives.

The technology is at least falling in price, making it affordable to the less affluent. Until manufacturers can convince the consumer that their products will simplify and improve, rather than complicate, their lives, then technophiles will continue to account for most new adopters.

  1. ‘Nice to have’, not ‘must have’

Amid the hype that often surrounds launches of innovative products it’s easy to forget a mundane truth: technology’s popularity is ultimately dependent on whether it solves a problem, making your life easier or simply more enjoyable.

Consider Google Glass, released to much fanfare early in 2015 and promptly abandoned after just a few months. It was supposed to liberate users from the constant need to pull their phones out their pockets to check notifications, but Google’s ‘always-on’ alternative arguably irritated consumers more by removing their choice – especially at the cost of $1,000.

Smart home innovators are trying to convince consumers that their products will make a positive difference to their lives. But how many people would rank turning lights on and off at the wall among their top irritations?

Even solving these very minor irritations, this still nascent technology can introduce new irritations such as intermittent connectivity, software bugs and so on.

But systems will improve, become cheaper and shift the balance between problems solved and problems introduced.

Plus home automation has one major trump card: the potential to save the homeowner money.

Smart thermostats like this one from Nest Labs have the potential to cut energy bills

Smart thermostats like this one from Nest Labs have the potential to cut energy bills

It’s no coincidence that perhaps the most famous company to emerge in the home automation market – Nest Labs – promises to save the consumer money.

Acquired by Google for $3.2bn in 2012 Nest Labs produces sensor-driven smart thermostats (as well as smoke detectors) that learns how to regulate temperature according to the home’s residents and the seasons, potentially meaning hundreds of pounds of savings in energy bills.

Should energy prices surge then the economics of home automation become more compelling. Government incentives are helping too.

Michael Philpott, principal analyst at technology research firm Ovum, believes energy will be the thing that really accelerates the adoption of smart tech.

Speaking to the BBC he suggested it was a case of when, not if, the market takes off.

“By 2020 the majority of us will have a smart energy meter and smart thermostats, and other devices will be connected to it, such as your fridge, so it becomes more efficient in its energy consumption.

“Once consumers start to use this technology they’ll start to wonder what else can they do with it.”

  1. Reaching critical mass

Which brings us to the final obstacle. There comes a tipping point in any trend where herd instinct kicks in. If everyone else is doing it, we start to feel a little left out.

That bulky television in the corner of the living room seems a little antiquated when everyone else has a flatscreen HD TV. Strange as it seems this might ultimately happen with the humble light switch, the analogue smoke detector, the mechanical lock and key.

And when people visit friends’ houses and are wowed by the tech on show, take-up rates will surely rise.

 

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