Smart Homes and Home Automation – 3rd Edition

Smart homes and home automation are ambiguous terms used in
reference to a wide range of solutions for controlling, monitoring
and automating functions in the home. Berg Insight’s definition of a
smart home system requires that it has a smartphone app or a web
portal as a user interface. Devices that only can be controlled with
switches, timers, sensors and remote controls are thus not included in
the scope of this study. Smart home systems can be grouped into six
primary categories: energy management and climate control systems;
security and access control systems; lighting, window and appliance
control systems; home appliances; audio-visual and entertainment
systems; and healthcare and assisted living systems.
North America recorded strong growth in the smart home market
during 2014. The installed base of smart home systems in the region
increased by 75 percent to reach 10.2 million at the year-end. An
estimated 1.8 million of these were multifunction or whole-home
systems whereas 8.3 million were point solutions designed for one
specific function. As some homes have more than one smart system in
use, the installed base totalled an estimated 7.9 million smart homes at
the end of the year. This corresponds to 6.0 percent of all households,
placing North America as the most advanced smart home market
in the world. Between 2014 and 2019, the number of households
that have adopted smart home systems is forecasted to grow at a
compound annual growth rate (CAGR) of 37 percent, resulting in 38.2
million smart homes. Market revenues reached US$ 4.2 billion (€ 3.2
billion) in 2014, an increase of 48 percent year-on-year. The market is
expected to grow at a CAGR of 34 percent between 2014 and 2019,
reaching US$ 18.2 billion (€ 13.7 billion) in yearly revenues at the end
of the forecast period.
The European market for smart home systems is still in an early
stage and 2–3 years behind North America in terms of penetration
and market maturity. At the end of 2014, there were a total of 3.3
million smart home systems in use in the EU28+2 countries, up
from 1.75 million in the previous year. Around 0.34 million of these
systems were multifunction or whole-home systems whereas 2.93
million were point solutions. This corresponds to around 2.7 million
smart homes when overlaps are taken into account, meaning that 1.2
percent of all households in the region were smart at the end of the
year. The number of European households that have adopted smart
home systems is forecasted to grow at a compound annual growth
rate (CAGR) of 61 percent during the next five years, resulting
in 29.7 million smart homes by 2019. Market revenues grew by
60 percent to € 0.77 billion (US$ 1.0 billion) in 2014. The market is
forecasted to grow at a CAGR of 58 percent between 2014 and 2019
to reach € 7.6 billion (US$ 10.2 billion) at the end of the forecast period.
A point solution will in most cases constitute the consumer’s first smart
home purchase. In fact, point solutions outsold whole-home systems
in 2014 by a factor of six to one and generated 59 percent of the
combined market revenues in North America and Europe. The most
successful point solutions to date include smart thermostats, security
systems, smart light bulbs, network cameras and multi-room audio
systems. These products are marketed by incumbent OEMs such as
Honeywell, Danfoss and Philips; service providers such as SFR, British
Gas, Eneco and Protection1; and new entrants such as Nest, Ecobee,
LIFX, MyFox and D-Link. In the whole-home system market, traditional
home automation system vendors such as Crestron, Control4, Gira
and Jung are facing new competition as companies from adjacent
industries are entering the market. New entrants such as ADT, Vivint,
Comcast and AT&T in North America as well as eQ-3, RWE, Verisure
and Loxone in Europe have already established themselves among
the largest whole-home solution vendors in their respective regions.
The smart home market is gradually gaining broader consumer
awareness. In North America, advertising in mass media has
increased significantly in the past year and major retail chains such
as Target and Wal-Mart have recently started to sell home automation
products in many of their stores. In Europe, the market will be fuelled
by the numerous service providers that plan to launch or expand their
smart home initiatives with support from large marketing campaigns in
the coming year. Another development that will drive the smart home
market in 2015 is Apple’s commercial launch of HomeKit and the large
number of HomeKit-compatible products that will be introduced by
smart home product vendors. This will result in increased visibility
among consumers that benefits all players in the market.

1 Smart homes, connected
homes and home automation
1.1 Introduction
1.2 Types of home automation
1.2.1 Energy management and climate
control systems
1.2.2 Security and access control systems
1.2.3 Lighting and window control systems
1.2.4 Home appliances
1.2.5 Audio-visual and entertainment
systems
1.2.6 Healthcare and assisted living
1.2.7 Multifunction and whole-home
automation systems
1.3 Home automation market segments
1.3.1 Mainstream houses and multi-family
dwellings
1.3.2 The custom (luxury) segment
1.3.3 New homes versus existing homes
1.4 Channels to market
1.4.1 Professional installation
1.4.2 Retail
1.4.3 Service providers
2 Networks and communication
technologies
2.1 Overview
2.1.1 Different approaches to establishing
interoperability
2.1.2 Technology choices of product OEMs
2.1.3 Technology choices of whole-home
solution vendors
2.1.4 The role of smart home platform
vendors is changing
2.2 Smart home networking
technologies
2.2.1 Bluetooth
2.2.2 DECT ULE
2.2.3 EnOcean
2.2.4 HomePlug
2.2.5 HomeGrid
2.2.6 INSTEON
2.2.7 Io-homecontrol
2.2.8 KNX
2.2.9 Wi-Fi
2.2.10 X10
2.2.11 ZigBee
2.2.12 Z-Wave
2.2.13 Thread
2.3 Smart home middleware and
ecosystems
2.3.1 AllSeen Alliance
2.3.2 HomeKit
2.3.3 IFTTT
2.3.4 Open Interconnect Consortium
2.3.5 QIVICON
2.4 Smart home platforms
2.4.1 Alarm.com
2.4.2 AlertMe
2.4.3 Arrayent
2.4.4 Greenwave Systems
2.4.5 iControl
2.4.6 Technicolor
2.4.7 Zonoff
3 Technology providers and
OEMs
3.1 Market overview
3.1.1 Compatibility with whole-home
systems
3.1.2 Point solutions are gaining traction
among consumers
3.1.3 Smart home strategies for product
OEMs
3.1.4 Connectivity enables new value
propositions
3.1.5 New entrants challenge incumbents
with connected experiences
3.2 Security and access control system
vendors
3.2.1 ASSA ABLOY
3.2.2 Chamberlain
3.2.3 FortrezZ
3.2.4 Kwikset
3.2.5 MyFox
3.2.6 Tyco
3.2.7 UTC Climate, Controls & Security
3.3 Home appliances
3.3.1 BSH
3.3.2 Electrolux
3.3.3 Haier
3.3.4 LG Electronics
3.3.5 Whirlpool
3.4 Lighting and window control system
vendors
3.4.1 CentraLite
3.4.2 Leviton
3.4.3 LIFX
3.4.4 Lutron
3.4.5 Osram
3.4.6 Philips Lighting
3.4.7 Somfy
3.4.8 View
3.5 Audio-visual and entertainment
system vendors
3.5.1 D+M Group
3.5.2 Kaleidescape
3.5.3 Logitech
3.5.4 Naim
3.5.5 Niles Audio
3.5.6 Sonos
3.5.7 Sony
3.6 Energy management and climate
control system vendors
3.6.1 Danfoss
3.6.2 Ecobee
3.6.3 Honeywell
3.6.4 Schneider Electric
3.6.5 Tado
3.6.6 QGate
3.6.7 Radio Thermostat Company of
America
3.7 Healthcare and assisted living
3.7.1 CareTech
3.7.2 Doro
3.7.3 GreenPeak Technologies
3.7.4 Legrand
3.7.5 Lively
3.7.6 Tunstall Healthcare Group
4 Service providers and whole-
home system vendors
4.1 Market overview
4.1.1 The European market
4.1.2 The North American market
4.1.3 Attach rates per application area in
whole-home systems
4.2 Market segments and go-to-market
strategies
4.2.1 Professionally monitored security
4.2.2 Traditional home automation
4.2.3 DIY systems
4.2.4 Fee-based home control
4.3 Whole-home system OEMs
4.3.1 Belkin
4.3.2 Control4
4.3.3 Crestron Electronics
4.3.4 D-Link
4.3.5 Essence Group
4.3.6 eQ-3
4.3.7 Fibaro
4.3.8 Gigaset
4.3.9 Ingersoll Rand
4.3.10 Loxone Electronics
4.3.11 M2M Solution
4.3.12 Nest
4.3.13 SmartThings
4.3.14 Wink
4.4 Smart home service providers
4.4.1 ADT
4.4.2 AT&T
4.4.3 British Gas
4.4.4 Comcast
4.4.5 RWE
4.4.6 SFR
4.4.7 Verisure
4.4.8 Vivint
5 Market forecasts and
conclusions
5.1 Market trends and analysis
5.1.1 Greater consumer awareness benefits
all players
5.1.2 Lower price points opens the doors to
the mass market
5.1.3 Cloud-based systems enable new
services
5.1.4 Open versus closed smart home
ecosystems – getting the timing right
5.1.5 Professional security leads the North
American smart home market
5.1.6 Smart thermostats gain traction in
Europe and North America
5.1.7 Cellular M2M in the smart home
market
5.2 Europe
5.2.1 Revenues
5.2.2 Shipments
5.2.3 Installed base
5.3 North America
5.3.1 Revenues
5.3.2 Shipments
5.3.3 Installed base
Glossary