Navigant Research Blog

Key Hurdle Stifling Smart Home Adoption Starts to Crumble

Neil Strother — July 11, 2017

New signs for the potential of enhanced harmony and interoperability among smart Internet of things (IoT) devices and platforms have emerged. If true, a key hurdle slowing smart home adoption would begin to crumble.

Alphabet, Apple, and Amazon

At the heart of the interoperability movement are two important market players—Alphabet’s Nest and Apple. Both actions and words indicate a willingness to make it easier for disparate devices to work together. First, Apple recently announced it will no longer require a chip called MFi to be installed in a device for the device to work with Apple’s HomeKit platform. Then, Nest followed up by telling the website 9TO5Mac that it is at least considering support for HomeKit in the wake of Apple’s newly announced iOS 11 features (that makes supporting HomeKit easier) and the fact that Apple is dropping the MFi chip requirement.

Though it is not a done deal between these two tech giants, it looks like interoperability is closer than we expected. This could help unleash a market growth phase, as buyers will not have to choose only devices that work on a single platform, but will be able to more easily mix and match from multiple vendors.

Meanwhile, a competing IoT platform, the Amazon Echo (Alexa), keeps adding important device manufacturers willing to integrate with the leading voice-activated assistant. Bosch and Kenmore have announced some products will work with Alexa. Bosch will soon sell Alexa-enabled major appliances, and a new line of Kenmore Wi-Fi-ready smart air conditioners will work with Alexa, as well.

The Future of Interoperability

The need for enhanced interoperability has been a constant theme in Navigant Research’s IoT market reports, including the one titled Market Data: IoT Devices for Energy Management, which noted the issue. These interoperability steps by key market players are encouraging, and stakeholders should take note if they want to reap benefits from a widening market.

Nonetheless, consumers have some ways to go before committing to IoT smart home technology. A recent survey among American respondents shows 85% would prefer products from a single brand, indicating they understand the problems associated with a lack of products from diverse vendors that do not interoperate. The survey, sponsored by the UK brand Hive, also highlighted two other barriers: higher prices for products and the difficulty involved when it comes to installing the latest gear that leads to the potential need for professionals to lend a hand.

As my colleague Paige Leuschner pointed out in a recent blog, the need is evident for interoperability among products from the same vendor. Manufacturers need to keep this notion in mind as people integrate older versions of devices by making the devices backwardly compatible when at all possible.

Despite the market friction, there is reason for optimism given these signs of greater IoT or smart home product interoperability. For several years, I’ve been saying devices and systems need to play nicer together, and the message seems to be sinking in, at least among some product vendors. However, market stakeholders need to pay attention to consumer thinking. The Hive survey tells us many potential buyers are not convinced the technology is ready and affordable for them to adopt—and that’s a problem.

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