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Now that the Delta-ee Connected Home team has returned from under the bright lights of CES and Las Vegas, it’s time to have a look back on the event and think about what all the announcements, shiny new smart home gadgets, and new partnerships mean for the connected home market.
As you could maybe have guessed from title of this blog, Google went all out at CES this year with its marketing for the Google Home smart voice interface. They even had large vending machines (see picture) at all the venues giving out prizes for those willing to queue for >45minutes! Google assistants in white overalls showed off the functionality at their partners’ stands, and even the Las Vegas monorail had the text “Hey Google” printed on it. I think this is a strong sign that Google will look to fully challenge Amazon Alexa in the smart home voice assistant space in 2018, and based on what we saw at CES, there will be no lack of products compatible with this voice interface which is already available in 7 languages.
Google’s presence at the event this year was in stark contrast to last year’s CES when everyone was proudly displaying their Alexa integration and Google Home was nowhere to be seen. This is not to say that Amazon Alexa has lost its appeal as it is still the most widely integrated voice interface and a key driver for the whole connected home market. However, it seems that now working with Amazon Alexa is considered an “industry minimum requirement” and is not something to proudly display at a cutting-edge event like CES.
Also noteworthy was the absence of all other voice interfaces. Both Siri and Microsoft Cortana were nowhere to be seen – and I was really looking for them! Samsung did demos to display their Bixgy voice assistant, but as for now, it seems very clear that it’s a two-horse race for the smart home voice interface and all the challengers have a lot of catching up to do.
While the smart home technology doesn’t quite look ready for a totally hubless future, at CES there were several companies that are embedding the hub into other smart home products. I can’t count the number of discussions where I was told that “the customer doesn’t want a white box next to its router, so we’ve decided to integrate the hub into [X]”. Examples include security cameras, the Hive 360 Hub (a smart audio analytics device) or Legrand’s smart sockets.
Also, maybe the biggest smart home announcement of CES also followed this theme: Comcast will integrate smart home hub functionality into 15M routers in the US via a Firmware update. This is a very aggressive play by Comcast, similar to what Deutsche Telekom is doing in the German market, and could really help the emergence of more affordable smart home propositions. Removing the cost of the hub removes a large part of the costs associated with purchasing a new smart home system. Though it is worth noting, Comcast has quite a bit of catching up to do in the US market as Vivint has been able to solidify its market leading position and now has around 1.5M customers in total. By integrating the hub to their routers, Comcast might actually have a chance to challenge Vivint’s dominance in the market.
While connected cameras have been heavily featured at CES for several years now, at least to my eyes it seemed like there were even more of them on display – or at the very least from bigger players. It might be that this is partly a function of the fact that CES is held in the US where the security vertical has been the main driver for the market.
Still it seemed like everyone is trying to capitalise on this part of the market. We for example saw industry giants such as Honeywell introduce their all-in-one smart security camera, Hive displaying their new Hive View camera, Canary announcing a new more affordable Canary View camera, and a countless number of smaller start-ups displaying their cameras with pride. Walking along the aisles of the Las Vegas Convention Center from one stand with smart cameras to the next, I couldn’t but help to think that could the market already be saturated with these products already? While the smart camera market is bound to grow in the future (both in US and Europe), I think we might have reached the peak of number of companies trying to target this segment. Maybe in 3 years’ time at CES this space will look very different and we’ll look back at this time and think “how could there have been so many companies in 2018 doing connected cameras?”
On top of the 3 themes highlighted above, it’s worth pointing out that this year we saw more and more big brands from outside the smart home industry partnering with companies to bring connectivity to their industry. Examples of this include Legrand (world’s largest switches and sockets provider) and Muller Group (French manufacturer of heating solutions) partnering with Netatmo, Leroy Merlin (a large European electronics retailer) launching their Enki app to integrate several different smart home products, Samsung and LG showcasing their smart appliances, Kohler (American kitchen and bathroom provider) bringing connectivity to the bathroom and kitchen, and the countless smart sleeping solutions (e.g. Nokia Sleep). And the list could go on and on.
Also, it is worth pointing out that the connected home is not just for the tech-savvy millennials. There were countless examples of companies showcasing smart health solutions and talking about how the connected home could be used for elderly care applications. So, it seems like the connected home is starting to be embedded across all the rooms within a home, but also for all the demographics.
Matti is now responsible for all Delta-ee's research delivery under the Connected Home Service, providing high quality research to help clients understand the dynamics and opportunities within this market. He also participates in bespoke consultancy projects on various low-carbon technologies and markets. Prior to joining Delta-ee he worked for PwC Finland providing consultancy and verification on Corporate Social Responsibility reporting and the Greenhouse Gas (GHG) Protocol.
Matti holds two MSc degrees with Distinctions, one in Economics from the University of Tampere in Finland and one in Carbon Management from the University of Edinburgh.
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