Intelligent Home > Smart Home Blog

Smart Home Opportunities Finally Emerge After Multi-Decade Gestation

by User Not Found | Nov 14, 2011

I think I must amaze some of my younger colleagues when I show them one of our ancient hard copy multi-client studies, a few dusty samples of which I keep stacked away in a cupboard in my office. The fact that a research report can exist on paper alone takes some getting used to in this online era.

 I have little cause to refer to them nowadays, of course, but that changed recently when Strategy Analytics decided to renew its focus on smart home. Back in 1986, shortly before I joined the company, it published a study called “The Interactive Home”, so I was curious to see how some of those predictions stacked up with the benefits of 25 years of hindsight.


Sure enough, we talked about the concept of “smart home” in that report, largely in the context of home automation, management and security. We noted in particular that in Germany “there seems little or no coherent drive twoards realisation of ‘Smart Home’ concepts at present”. A key obstacle was the high levels of rented and apartment accommodation, which reduced the need for automation and security systems. The conclusions in the UK also make interesting reading: we identified a “growing body of serious PC owners” who would “help open up the information-related interactive sectors”, as well as opportunities in interactive television and electronic publishing. The study also concluded that “energy telemetry” was “likely to emerge as a prime investment area in the early 1990s”.


The study had a 10-year forecast horizon, which is fairly ambitious compared to regular analyst reports. We may laugh now at a forecast of what would happen in the late 1990s, but that seemed as far off in 1986 as the 2020s seem today. And in fact, as so often happens with emerging technologies, while the long-term scenarios were broadly correct, the future timing of events was misunderstood. And in general the report was over-optimistic in terms of predicting the speed with which new “smart home” services would emerge as mass market opportunities.


Given those past uncertainties and false dawns, the question posed by my colleague, Bill Ablondi, is right on the mark: “Smart Homes: Why Now? He identifies a number of reasons to think that we may not have to wait another 25 years before true interactive home technologies become widespread, including:


·         Consumers becoming increasingly connected via mobile devices  

·         Broadband service providers need to develop additional revenue generating units (RGUs) to offset declining growth in traditional businesses  

·         Expansion of offerings from traditional home security systems providers into self-monitoring and control products and services

·         Introduction of affordable, retrofit solutions that can enhance lifestyles, safeguard homes and reduce home operating expenses

·         Manufacturers of appliances and home systems desire to differentiate their offerings and expand their opportunities

·         Government incentives and mandates to reduce energy consumption by connecting residential customers to advanced electricity distribution and management systems


In other words, some high value industry sectors are getting serious and see that many pieces of the smart home jigsaw are lying around waiting to be put into place. Key barriers remain, of course, not least persuading consumers that there is value in these systems and services. That’s a key set of questions which our new advisory service, Smart Home Strategies, will be exploring over the coming weeks and months.


David Mercer


Client Reading: Smart Homes: Why Now?

Next Post: Best Buy: Making Home Energy Management Real

Let's talk

Now you know a little about us, get in touch and tell us what your business problem is.
Inquiry / Message:

please enter captcha from left