2014/10/08

Anyone who owns a smartphone or tablet computer has the potential to carry in their pocket a doorway to their homes.


The introduction of the smartphone and other mobile devices, in conjunction with advancements in wireless networks and cloud-based services, has brought new meaning to the term "mobile home." Today, it is possible for homeowners to check on their homes regardless of where they may be, provided that an Internet connection is present. While the majority of consumers have yet to embrace the smart home concept, there is no doubt that its adoption is set for rapid growth. According to a recent report by Juniper Research, smart home revenues will reach $71 billion by 2018.

WHY NOW?

Various forms of home automation have existed over the past two decades, but they have been too expensive and troublesome for most homeowners. Today, however, costs are signifi cantly lower, and the ubiquity of mobile devices and the emergence of the app economy have made it easy for consumers to interact with products and services.

Alarm.com has been a part of the evolution to the smart home market, having been first-to-market with some features, said Jay Kenny, VP of Marketing at Alarm.com. "We launched our fi rst mobile app in 2009. That really was a big game changer; the mobile app and mobile device is one of the key things that has driven really rapid adoption of the technology." Indeed, in the following years, Alarm.com started to see rapid growth—Alarm.com is the largest connected home platform in the U.S.A.

For mobile apps, cross-platform support is crucial—iOS and Android native apps, as well as web apps. "This is extremely important to reach the mass market as consumers can make devices work together and schedule them to run at certain times without having to download additional apps for each device, said Bob Cooper, CMO at Zonoff. Zonoff is behind the technology that powers the Staples Connect platform.

The big trend toward cloud services is also a factor driving adoption for consumers, since they dramatically decrease the cost of ownership, Kenny continued.

In hindsight, it is only natural that consumers who are always connected will want to always have access to devices in their homes. "A lot of companies have observed that opportunity and are now getting into the market," said Kenny said.

SECURITY AT ITS CORE

Right now, many consumers are attracted to the direct benefits of a connected device. No products bring direct benefits as security products do, making home security one of the core features of the smart home that is driving adoption.

A basic home security system comprises video, sensors and 24-hour alarm monitoring. When an alarm goes off, the police will show up; when there is a fire, firefighters come to put it out. Two high-growth add-ons to those services are video monitoring and energy management, Kenny said.

Video monitoring is one of the most important components in a modern home security system. "More and more people are adding video cameras to both the outside and inside of their homes. Being able to stream real-time video to a mobile phone is really interesting to people, both from a security perspective and an awareness perspective," Kenny said. "If you have kids, it's nice to know that they are safe at home and are doing the right things. If you have pets, you also want to know that they are safe and are having fun. Both the awareness and security aspect of the video are really important."

Even something as simple as a smartphone-controlled garage door opener can bring signifi cant convenience and peace of mind to homeowners. Since 70 percent of Americans
enter their home via the garage door, it is not only important to know the status of that entry point, it is also convenient to have the ability to check that status when a homeowner has driven 10 minutes away from home and worries that the door is still open, said, Bob Dahlberg, VP of Business Development at Arrayent. Arrayent's platform powers the home appliances of numerous well-known manufacturers.

SPREADING OUT FROM SECURITY

Security is the primary service that consumers value and are willing to pay for, but Alarm.com is also seeing it drive a lot of adoption in thermostats and lighting.

According to Parks Associates, nearly two thirds of US consumers are interested in buying a smart thermostat. Dahlberg agrees: "This industry has tipped. If you are in the thermostat business and you don't have a connected thermostat strategy, you are going out of business."

As for lighting, "it is the lowest cost way to impact the home environment. LED bulbs are getting lower and lower cost every day, getting close to compact fl uorescents. ZigBee vendors are quoting ZigBee SoCs at less than $1 in 2015," Dahlberg said. "The combination of LED and connectivity means lighting control (on, off, dim) will be very easy to install."

Low cost is important because while there are vertical opportunities for all connected products, the near-term value of smart appliances is all around a collection of small conveniences; no single feature alone is compelling in its own right, Dahlberg continued.

UniKey's VP of Sales and Marketing Dirk Wyckoff thinks it is also crucial for the smart home that devices can stand on their own when integrating devices into a single intelligent system. "For a product to have mass appeal, the product's value proposition to the consumer must be singular in nature, meaning it must stand on its own without necessary integration into a larger system that is typically reserved for services with monthly fees. The product must be simple and elegant in both interface and appearance." UniKey developed the technology behind the popular smart lock Kwikset Kevo.

A home full of devices that can interact with each other for the benefit of the user is indeed attractive. The concept of energy management has become popular—not just controlling appliances via a mobile app, but the integration of those appliances with the rest of the home, Kenny said. "For example, when I arm my alarm system, the thermostat automatically adjusts. If I leave my backdoor open by mistake, I can have the system adjust to that, too."

PULLING IT ALL TOGETHER

For the connected home to be realized, devices need some way to exchange data. This can be achieved at the device level, through a hub, or through a cloud service. Many manufactures have their own ecosystems of connected devices, but this is a barrier for wider adoption. There are also multiple proprietary and open protocols that are widely adopted by the industry for use in connected devices—the problem is, users have to go through hoops to make them work together.

Interoperability is essential for the smart appliance industry because consumers want to have the flexibility to buy best-of-breed appliances and have them work together, Dahlberg said.

In the case of Blacksumac's popular security and home automation unit Piper, which reached three times its original funding goal on crowdfunding platform Indiegogo, Z-Wave was the optimal protocol. "Most users know very little or nothing about smart home technologies, and we wanted to give of users the broadest range of interoperable smart home accessories to make learning about it easy for them. Z-wave offers our users with a huge range of choices and from a large group of manufactures," said Russell Ure, CEO and co-founder of Blacksumac.

Alarm.com's system is more holistic, working with Z-Wave, ZigBee and Wi-Fi devices. However, not all protocols are created equal. "The main difference for us when we evaluated the protocols available on the market is that Z-Wave had more of a standards approach to their protocol. If you integrated a Z-Wave chip into your solution, anything that is Z-Wave will work," Kenny said.

ZigBee, on the other hand, has many more variations; different ZigBee devices may run different "fl avors" of ZigBee, Kenny continued. "There isn't a standardization of the protocol. It is more like an open-source code base that people modify and use."

Wi-Fi devices can be even trickier, since some manufacturers, such as Nest and Sonos, do not officially give third parties access to their APIs. Solutions like Revolv work around this by reverse-engineering the APIs of popular devices made by these companies. However, this approach means that users will be shut out if these manufacturers push out a software update to their devices, Cooper said.

In contrast, Staple Connect's approach is to form partnerships directly with device makers. "Staples Connect is targeting the mass market consumer and we are focused on building the broadest and most compelling ecosystem for devices. As such, it is important for us to give consumers assurances that the devices included in the ecosystem are done so in an offi cial capacity, with the manufacturers a core part of the experience," Cooper continued. "At a high level, the more devices we can embrace and bring in to this solution, the better it is for consumers. However, we're sticking to our model where we work with premium brands consumers know and trust, while also keeping the ecosystem open for new, compelling and emerging companies as well."

Standards make for lower cost implementations, since the learning curve is not as steep; it is also easier to create systems in which products from multiple manufacturers work together. On the other hand, proprietary systems afford advantages such as longer range (1W 900MHz networks can go over a mile) and plug-and-play installation and provisioning, Dahlberg said. It is unlikely that all manufacturers will collaborate to interoperate in the home by agreeing to adopt the same communication protocol, but interoperability can be achieved relatively easier in the cloud. "Arrayent already has a customer, Chamberlain, that connects its LiftMaster branded garage door openers to
an Alarm.com home security app via cloud-to-cloud integration," Dahlberg said.

OFFLOADING INTEROPERABILITY TO THE CLOUD

Alarm.com's approach to interoperability relies on its cloud service. "Our system consists of communication devices that go in the home, a cloud service connects all the different elements and cuts rules and automation for the hub to bring them all together, and apps to make management and operation simple for users," Kenny said.

The devices don't have to talk to each other in the house. The door sensors talk to the hub through radio waves; the door lock and thermostat through Z-Wave, Kenny continued. "They don't talk to each other, but our system can talk to them in a choreographed way, so if you open the door system, the thermostat can adjust, for example."

Kenny provided another example, "Our high definition video cameras connect over broadband. They don't talk to the other devices, but they're aware of what's going on the house because they talk to our service. The devices don't necessarily talk to each other, but they can do intelligent rules because they talk to our cloud service."

Cloud services also allow device makers to offer more advanced features that may not be possible when limited to the hardware of a single device, especially when the device itself has limited processing power—sensors, for example. With richer features, device makers can also differentiate themselves in an increasingly competitive market, Wyckoff said. "These technologies are enabling us to succeed in a demanding environment."

It is, however, important that users do not lose the ability to control their devices even when their Internet connection at home is down. The advantage of a point-to-point solution is that if the Internet goes down, the system will still function; when you press the light switch, the lights will go off, because it does not depend on an Internet connection, Cooper said.

"Even in 2014, broadband service in the U.S.A. still isn't 100 percent reliable all the time. Most people, even with some form of broadband, don't realize it's not always consistent or reliable. Downtime of less than a minute may not be a big deal when web surfing, but it matters when you come home late at night and your lights don't work. We believe a home automation solution needs to work even when the Internet is slow or down," Cooper continued. "When Staples Connect customers are inside their home using a smartphone or tablet, they connect to the hub via their home WiFi network. When they are outside the home, they connect via their cellular network, through the cloud, to the hub," Cooper said.

The key factors for a successful cloud service are scalability, latency, security, and reliability, which are also the some of the biggest challenges in making cloud software, Cooper said.

INTERNET CONNECTIVITY = SECURITY ISSUES

Any device that connects to the Internet is bound to have vulnerabilities, especially when manufacturers are inexperienced in making these types of devices or deliberately neglect security to cut costs.

"First and foremost, security aspects cannot be compromised, and I can't stress how intricate those elements are. Opening a door with a mobile device is one thing, opening it without vulnerabilities is another," Wyckoff said. "Our product has been on the market for four months and has been publicly declared attack against by the black hat community. This speaks volumes about our architecture and implementation. This element is so often overlooked in the Internet of Things, but when you couple this to the access to your home, security cannot be compromised in any fashion."

While some try to argue that tighter security impacts user exerience, it is not necessarily a zero-sum game. "We believe that security is the responsibility of the device manufacturer, and at Blacksumac we take security very seriously," Ure said. "Security problems are due to poor testing and poorly defined internal test programs rather than a result of improved usability."

EXCITING THINGS AHEAD

At the moment, device makers and service providers are still trying to come up with a compelling scenario that will convert even non-believers. Five years from now, every device will be connected; for the next two to three years, manufactures of different products will continue to learn and experiment, Kenny said. "I think there is a very clear path. Everything in the house will be connected, and we're at the very early stages of understanding how these devices can connect to each other and what they can do with that connectivity."

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