In a world increasingly dominated by connected devices and mobile users, the concept of smart home and home network has long ways to go. Researches show the future of home network market is robust, given the wide adoption and acceptance of smart technologies in every aspects of life.
Home networks provide the foundation to connect mobile devices, appliances and systems in the home.
Alex Hawkinson, CEO and founder of Samsung SmartThings, says customer education, ease-of-use, and widespread accessibility are the main factors that will influence the adoption rate of smart home technology. The company released a Home Monitoring Kit as a smart home solution.
Eyeing on an expected boom in connected home and connected offices, home network vendors are upgrading or making their solutions suitable for smart homes.
Smart home technology provider Vivint says it is experiencing record demand for its integrated smart home products and services. Of new customers, 80 percent are choosing multiple smart home devices with their system, such as a smart door lock, thermostat, indoor or outdoor camera, or the recently released Vivint Doorbell Camera.
Vivint has also seen a 60 percent increase in smart home customers since the launch of its Vivint Sky smart home platform in the spring of 2014.
New research from CP Consulting showed that manufacturers are getting ready for Christmas with a wider product range. Google, Amazon and Apple have all recently announced new products for the Connected Home.
In the U.S., manufacturers have ramped up their investments in advertisement of Connected Home devices on national TV with an estimated monthly expenditure of $25 million to $35 million in September 2015.
Recent vendor activities
D-Link announced a free firmware upgrade for the AC1900 Wi-Fi Router (DIR-880L) that brings Smart Connect Technology to the dual band router. Previously only available on D-Link’s AC3200 Ultra Wi-Fi Router (DIR-890L), Smart Connect technology automatically connects each device on a home network.
Ken Loyd, director, consumer product marketing, D-Link Systems, says automating the process of connecting clients to a network not only ensures that each device is connected to the appropriate band, but that the wireless bands are continually balanced as more devices are added over time.
Enterprise IT major Intel is also in the race. In mid-October, the company unveiled a range of products designed to improve the delivery and quality of entertainment content available in-home via the cloud.
The new products include the Intel Visual Compute Accelerator for Intel Xeon processor-based servers, the Intel Puma 7 SoC for cable home gateways, and the Intel AnyWAN GRX550 for xDSL and Fiber home gateways.
Albert Diaz, vice president and general manager of product collaboration and systems division in Intel’s Data Center Group said the Intel Visual Compute Accelerator will deliver high quality video with improved performance and cost per transcode channel to enable real-time off line transcoding with CAPEX and OPEX savings for content providers.
Also in October, NETGEAR Founder CEO Patrick Lo outlined his vision on SMART IT saying that it is creating products for home networking and IoT ecosystem.
Apple offers a HomeKit, which the company says is a framework for communicating with and controlling connected accessories in a user’s home.
Forecast on smart homes and spending
According to latest report from ABI Research, the smart home market would reach $34 billion in 2020 and it is becoming the center of activity for multiple IoT ecosystems, including wearables.
A recent study by IHS Technology’s Home Appliance Intelligence Service, the global smart connected white-goods market is forecast to grow from an estimated less than 1 million units shipped in 2014 to over 223 million units in 2020, equivalent to a five-year compound annual growth rate of 134 percent.
The total addressable smart connected major home appliance (MHA) market is forecast to be 470 million units worldwide between 2015 and 2020.
Another report shows consumer spending on smart home services will reach $100 billion by 2020. New data from Juniper Research revealed entertainment services such as Netflix and Spotify are playing a key role in boosting the Smart Home market size.
The research forecasts that the number of connected appliances in Smart Homes will rise to over 20 million by 2020. The market will continue to be characterised by high prices and a low value in connectivity.
Garter is also optimistic about smart home market. The research agency says the number of smart connected homes is expected to grow from between 100 million and 200 million homes now to between 500 million and 700 million homes by 2020.
Now that thousands of new connectable devices are becoming available, all the euphoria about the possibilities is no longer just hype,” notes Holger Knöpke, Vice President, Connected Home, Deutsche Telekom AG. “But companies will have to cooperate actively if a real mass market is to develop.”
According to Research and Markets, privacy and security remain the critical challenges for the connected home appliances market since data is carried over the network.
Convincing consumers is another challenge that the smart home market is facing. A new research from CP Consulting found that 55.2 percent of the UK consumers not planning to buy any products in the next 12 months do not feel the need for Connected Home devices.
Moreover, 41.6 percent think that devices are too expensive and 22.9 percent are concerned about their privacy.
As far as the vendor community is concerned, they are struggling to address the mass-market. Steffen Sorrell, researcher at Juniper Research, says enabling services to generate recurring revenue on top of Smart Home hardware will be crucial for realising the projected long-term success of this market.
“However, tapping the developer community to innovate and address the wider market remains an issue,” Sorrell said.
Gartner believes that home automation solutions will become an integral part of the home network. The main challenge is the multiplicity of home automation wireless standards. Wi-Fi is widely deployed in homes today, but the high power consumption of devices using this technology is a challenge in home automation.