Who Is Bringing The Connected Home To Your Home?
It has been said many times: the connected home market is a very large one, and still mostly unexplored. With its huge potential and business opportunities, it comes as no surprise that many players want their share of the pie. It is somewhat striking, nonetheless, the incredible variety of players, from completely different industries, that are jumping onto the connected home wagon and competing to achieve the largest market share. So, who are the Connected Home Market players?
Security service providers
It is only natural that these players are currently leading the market, since expanding into smart home technologies is the logical course of action for traditional home security companies. The emergence of IoT, smartphones and cloud services are making their legacy technologies obsolete, and consumers won’t purchase an old security camera if they can have a networked one that sends images and video streaming straight to their smartphone for the same —if not less, money. Also, smart living technologies offer security service providers the opportunity to expand into connected home features, such as smart lighting and energy management. Since smart tech is much more affordable for mass market consumers, it also helps them reach a wider public, such as renters and younger people, expanding their business scope.
Professional security companies are trusted providers who can ensure not only their system’s security, but also all the services and support consumers may need. This is a significant advantage over other entrants that they are in a position to exploit, but they have to act quickly instead of resting on their laurels, since other players are taking giant steps in the same direction.
Although they lack some of the advantages of security providers, Telcos are already beginning to figure out effective business models. Many of the world’s largest telcos already offer their customers bundles of services that include some form of home security among other connected home features. Just like security dealers, telcos have the advantage of having a service-based revenue model already in place, and also the necessary technical service and customer support infrastructures. Besides, consumers are used to paying a monthly fee for their services, which makes it easier to offer them upgrades in the form of connected home devices. According to Parks Associates, telcos and cable providers “have about a 5 percent share of the monitored security market […] right now and all of their service offerings include connected home services”.
We are talking about companies such as Google, Apple, Samsung or Amazon. Companies with no previous connection to home security or home automation, have seen the market potential and want to join in. These companies are beginning to offer different types of connected home devices, each creating its own ecosystem of compatible products and services. According to some industry experts and analysts, this should be seen more as an opportunity for growth for the market as a whole than as a threat for other more industry-related players, since they are helping educate consumers and create awareness about connected home devices.
There are also myriad companies, startups and established companies alike, offering DIY connected home solutions. Some focus on a standalone device that will generally communicate with others directly over the cloud, while others have released a full range of products with a hub to manage them all. Many of these DIY solutions are being distributed via retail channels, and some of them are even developing or branding their own range of products. This type of companies may pose a direct threat to security companies, reducing the need for installers and professional monitoring. However, security companies are already figuring out a way to diminish the threat while taking advantage of the DIY space, offering monitored solutions for DIY-installed security systems. Besides, in many cases this type of company has to deal with security and data privacy issues, as well as lack of interoperability with other devices. So they have a tough work ahead of them to gain customer trust and prove their reliability before they can really become a serious threat.
Last, but not least, even insurance companies are probing the connected home market, as a way to get closer to their customers, by offering discounts and promotions to those who use connected living tech at home. Both benefit from it, since smart devices help prevent accidents, such as a flood if there is a water leakage sensor in place, and thus the insurance company manages to reduce claims. Some have already launched products and services, and the industry in general is testing different business models around smart devices and services.
At present, smart devices are entering people’s homes through a range of channels, with a clear advantage to those with pre-existing customer relationships. In this sense, telcos and security providers —especially the latter, have a clear head start from their competitors, but they should take advantage now, as it will not last for long.
Easy Related Posts
Insurance and the Smart Home Industry: A Win-Win Proposition
If there is one leading market that is has the most to gain from IoT ...read more
Residential IoT’s Common Denominator is Peace of Mind
We have already discussed in this blog the paradigm shift that took place in the ...read more
Alternative Revenue Streams in The IoT: Creating a Profitable Environment for Service Providers
In 2016 consumer adoption of connected home devices experienced a huge leap forward. IHS Markit ...read more
Connected Living for Better Business: How Do We Do Business From Connected Homes?
We talk a lot about smart homes. However, most of the discussion centers around what ...read more