Navigant Research Blog

The Battle for Control of Lighting Controls

Jesse Foote — July 18, 2013

With the rise of LED lighting and inexpensive controls technologies, the market for networked lighting controls is expected to increase sharply in the coming years.  Three types of companies are maneuvering to take advantage of this opportunity: pure-play lighting controls companies, big lamp industry players, and traditional building controls vendors.  Each group has its advantages, and it’s far from clear which will end up leading the lighting controls market in the future.

Pure Plays

As  with other new technologies, the path has been broken by small, dedicated companies that have developed innovative techniques and demonstrated the value of those techniques in the marketplace.  Companies like Daintree Networks and Redwood Systems have shown that networked lighting controls can save money and provide a valuable service to building managers.

Big Lamp Industry Players

The rise of LED lighting brings an opportunity but also a threat to the large, traditional lamp companies.  The long lifespan of LED lamps will eventually curtail the market for replacement lamps, leading to declining overall revenue from lamp sales.  In response, the big lamp companies are expanding their offerings to include lighting controls and networked systems.  Philips, Osram, and GE have all begun selling the software and controls products needed to centrally manage commercial lighting systems.

Building Controls Vendors

While the networking of lighting controls is a relatively recent development, the networking of HVAC and other building controls has become almost routine.  Some of the key players involved in building controls have begun broadening their businesses to include lighting controls.  Honeywell, for example, has begun selling its own lighting controls software in Europe and has plans to bring it to the United States.  Schneider Electric has also made acquisitions to allow the integration of networked lighting controls with its building management systems.

Building controls companies have the advantage of existing relationships with the applicable customer base.  Their customers trust them to provide systems that already control other systems within buildings.  Adding lighting controls to HVAC controls seems like a logical step.  The big lamp companies also benefit from existing relationships – and it is their products that customers are seeking to network together.  It would be logical for a customer to assume that the company who sold them their lights and sensors would be best suited to sell them the networking controls and software as well.

Between the building controls companies and the big lamp companies, it might seem that the smaller pure plays could be squeezed out of existence.  However, these startups were the first players to come to this table and have made significant inroads, so they shouldn’t be counted out.  With the greater adoption of open standards that allow interoperability between the equipment of multiple vendors, it may well be advantageous for customers to employ a third party for their top-level controls that will not lock them in to a specific vendor for lamps and peripherals and that will continue to push the envelope on innovative controls techniques.

A soon-to-be released update to Navigant Research’s 2012 report, Intelligent Lighting Controls for Commercial Buildings, will discuss these trends and provide profiles for many of the vendors in the lighting controls market.

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