Navigant Research Blog

Are Smart Devices Too Smart for Their Own Good?

— February 22, 2018

There is so much promise around how smart devices will make our lives more comfortable, convenient, efficient, and automated. These devices are supposed to learn from our lifestyle patterns, analyze this information in real-time, and perform tasks seamlessly in the background, without it even occurring to the user that all of this smart stuff is happening. I have bought into this promise, having adopted several digital assistant-enabled devices and connected products, because I can see a future when all of this tech comes together to create truly smart homes. And I’m not the only one—these futuristic ideas about tech seamlessly, automatically operating in the background of our lives can be seen in popular media like Black Mirror and Her. This future is imaginable, lingering on the horizon.

The Problem with “Smarts”

However, we are still at the precipice of the technology revolution supporting the future scenarios as seen in pop culture. Don’t get me wrong, technologies emerging today really are smart, and are already making our lives significantly better. But at this time, many these devices are not actually delivering on their promise, and they don’t work that well in our everyday lives. For example, my colleague, who is also an early adopter of smart technology, has been having issues with his ecobee3 lite. His smart thermostat has started preheating at such early hours of the morning that he wakes up before his alarm clock, sweating. ecobee customer support has suggested that the problem may be because he likes to sleep cold, at 60°F, and wake up warm, at 70°F, and that the large variance in setpoint means the thermostat must kick on the heating system well in advance to make up the difference in temperature by the time my colleague is awake. The issue makes sense logically, but ultimately my colleague shouldn’t have to compromise on his desired temperatures. A smart thermostat should be smart enough to figure it out. And his Nest isn’t any better—when the cooling season comes around, his Nest sends him alerts that it is unable to activate his cooling system, when his home doesn’t even have a cooling system. I’ve heard countless stories of people tearing smart thermostats out of the wall to replace them with programmable thermostats, never opening the digital assistant device they got for Christmas because they don’t really know what smart things it can do, and returning smart plugs for plugs with a simple timer.

As a consumer, these examples have put doubts in my mind about how smart these products really are. As a research analyst, when I attend shows like CES where some of the most impressive and innovative products are on display, it makes me skeptical about how these devices will actually perform in the home. These devices are peddled to consumers as seamless, automatic, and easy to use, but sometimes it seems we are spending more time managing them than they are managing our lives. Perhaps these devices are too smart for their own good, and consumers are not ready for how advanced these products can be—we just want the old, dumb devices that we know will work. The learning curve for smart technology is steep and we are still in an early stage of piloting and innovation, but as these technologies reach the hands of mainstream consumers, vendors need to ensure that their smart products are delivering on their promises of being smart.

 

Indoor Farming: Land of Opportunity

— February 20, 2018

Plenty, a vertical farming startup, has generated lots of media buzz. So far it has raised $226 million and is associated with big names like Alphabet’s Eric Schmidt and Amazon’s Jeff Bezos. Plenty promises to grow crops efficiently while shortening supply chains and catering to customer preferences. However, there is more than just hype behind Plenty’s big names and big numbers. There are important political and environmental drivers that are pushing market incumbents into urban farming, signaling that indoor farming is not just a passing fad.

Enter China

National self-interest is driving China to invest in agtech solutions like indoor farming. The state-run Agricultural Development Bank of China has pledged $437 billion in loans to finance agricultural projects through 2020. This is $31 billion more than the value of the US’ entire agricultural production last year. Currently, China faces food security issues stemming from pollution, uncertain trade relations with foreign countries, a history of food safety crises, and a growing middle class. Pairing China’s food security issues with a well-funded farming startup like Plenty is a no brainer.

Securing Food In-House          

However, China isn’t the only player with skin in the game. Other countries facing food security issues are interested as well. Qatar, for example, relies heavily on expensive agricultural imports due to water scarcity and unproductive farming land, leaving the region vulnerable to supply shortages and price spikes. Saudi Arabia faces its own food security issues, which the country is attempting to alleviate through investments in foreign countries such as Sudan, Pakistan, and Ukraine. However, as indoor farming becomes more affordable, it will likely attract investors away from foreign agro-investments and toward local indoor solutions, which would strengthen resilience to issues stemming from food insecurities.

In addition to national self-interest, environmental issues are also prompting greater interest in indoor farming. As climate change threatens to disrupt weather patterns, indoor farming allows farmers to control the weather—and a number of other variables—allowing companies like Plenty to produce greater crop yields and higher quality food than traditional farmers. Indoor farming consumes less water, which will surely be on the minds of farmers and policymakers as climate change threatens to exacerbate drought around the globe. These farms also allow food to be grown safely away from pollution and contamination, which are becoming increasingly problematic as farmers overuse pesticides and fertilizers and as developing countries are faced with mounting pollution.

Headed to Greener Pastures?

Despite its wide-ranging benefits, LED technology for indoor farming is relatively new and is not yet economically viable on a large scale. In fact, a 2017 Agrilyst report found that only 51% of indoor farms in the US are profitable. This is the case for most young farms, as older facilities averaging 7 years or more have had time to realize greater returns from energy efficiency and operational savings. In order to gain traction, urban farmers should focus on crops that are in local demand and that will always be in demand, like salad crops, in order to establish their business. Once farmers begin generating a profit, they can then devote more resources to experimenting with other possibilities.

Tech innovation is on its way, helping to make indoor agricultural operations more efficient through enhanced applications like LED and data analytics. The problem is funding these investments. Hopefully, there are more Jeff Bezos of the world to support the indoor farming movement and help make the world a greener, more sustainable place. For more information on horticulture lighting, watch for our forthcoming report, LED Lighting for Horticultural Applications.

 

The Evolving Smart Home

— February 6, 2018

The growth of the Internet of Things is continually expanding the number of connected devices in our homes, offices, retail stores, and healthcare facilities, to name a few. According to Navigant Research’s recent report, The Smart Home, global smart home platform revenue is expected to increase from $4.2 billion in 2017 to $39.5 billion in 2026. This significant increase in revenue makes it clear the smart home is here to stay. With the smart home on the rise, what is the real added value these solutions offer to consumers?

Do Smart Solutions Provide Enough Value?

When you think of the smart home, it’s not uncommon to first picture Amazon’s Alexa-enabled voice activated devices, which allow users to play music, listen to the news, receive weather updates, and control compatible devices like a Philips Hue smart bulb all through voice. While devices like smart bulbs do provide additional benefits outside of voice control—such as dimming, color changing, and reducing energy use—how much additional value are these solutions really providing? Philips Lighting recently announced new software features that will sync Philips Hue lighting with gaming, movie, and music content. While this update does include additional features, how much value is this really adding? Is it helping to carry the smart home market forward? Is voice control, dimming, syncing with video games and movies, and energy savings enough? I would argue no. The added convenience of voice control and color-changing or dimming features through devices like smart bulbs do not provide enough of an advantage over more traditional products, like LEDs, for many consumers to justify paying the additional costs. The concept of voice control and changing the color of lighting through a mobile app are novel ideas that provide enough of a wow factor to intrigue consumers, but these features are not enough to carry the momentum of the smart home into the future.

Security as a Value Proposition for the Smart Home

Smart home vendors realize the need to provide additional value propositions for their products to appeal to the mass market and increase adoption of smart solutions. One of the top key trends expected in 2018 by Consumer Reports for the smart home industry is security. To be sure, this is not the only trend of the smart home this year; others range from additional connected devices to increased artificial intelligence to home healthcare, covered in a recent Navigant Research blog. Many of the trends anticipated for 2018 are about providing additional value to consumers for smart home solutions.

The desire for security is a universally shared need and one the smart home market can capitalize on. A recent example of this is Ring, a smart video doorbell company, acquiring Mr Beams, an LED lighting company offering indoor and outdoor LED fixtures. As a result of Ring’s first acquisition, the company launched a line of outdoor security lights. The new line includes pathway lights, step lights, and spotlights that will work jointly with Ring’s security cameras and doorbells. This acquisition not only highlights the growing significance of security as a use case driving progress in the smart home market, but also the importance of providing additional value to smart home products. Lighting integrated with security systems are a natural fit that can better highlight the value of smart home solutions for consumers than features like voice activation and remote control, and more logical partnerships will emerge. Security is just one example of a use case that can transform the smart home from providing additional convenience and a novelty features to a becoming a necessity for consumers.

 

Alexa’s Super Bowl Pick Demonstrates Advances in UX

— February 1, 2018

Over the past week, the internet has been captivated by Alexa’s pick for the Eagles to win Super Bowl LII, with tweets, videos, and articles featuring Alexa’s latest mantra: “I’m flying with the Eagles with this one because of their relentless defense and the momentum they’ve been riding off their underdog status. E-A-G-L-E-S. Eagles.”

Though most will look at this latest Alexa craze with a small chuckle and admire the assistant’s cleverness (or, if a Patriots fan, seething and swearing off Alexa), to me this response demonstrates a small step forward in user experience (UX) that has been lacking in digital assistants.

What Is UX?

UX is an increasingly popular acronym floating around the tech industry (not to be confused with user interface [UI]), and it captures a field targeted at improving the usability, ease of use, and pleasure provided in interactions between consumers and products. In the world of digital assistants, UX is about the smarts of a digital assistant and its ability to complete tasks asked of it in a satisfactory way to users.

Some would argue that, while there have been significant strides in voice activation as a UI, one of the biggest obstacles to the mass adoption of digital assistants is lacking UX. For anybody who has used a digital assistant, this is completely understandable. There is nothing more frustrating than asking Google Assistant, Siri, Alexa, or any other the other various digital assistants a simple question, only to have it not understand or reference something entirely unrelated. This type of mishap is frequent enough that it has even resulted in satire about the experience with digital assistants. One such example is a CollegeHumor clip where a woman asks, “Siri, how big is the Serengeti?” and Siri responds, “No problem. Show me pictures of spaghetti.”

Personality Is a Plus

While Alexa rooting for the Eagles isn’t exactly a groundbreaking advancement in the field of artificial intelligence and natural language processing, the fact that users are fascinated with this phenomenon and think Alexa has a sense of humor creates a more positive UX with digital assistants, and can help spur adoption of these devices. Personally, the fact that I get a clever response from Alexa on who will win the Super Bowl, while my Google Assistant says, “My apologies. I don’t know that,” gives Alexa a leg up on Google because taking a side is more personable than saying nothing at all. It’s a small gesture on Amazon’s part that makes a big difference in my experience as a user. As it so happens, I also agree with Alexa. Go Eagles!

 

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