While the concept of the smart home is expected to explode and completely revolutionize the way people interact with their homes, this space currently faces issues preventing mainstream adoption, the most significant of which is a lack of interoperability. The smart home space is fragmented with a variety of standards and networking protocols, and not all devices work together. Some market participants have developed relatively closed-off networks to ensure the devices operating within their ecosystem work well together and are more secure (and to incentivize consumers to join their club over other manufacturers), which is what Apple has done with HomeKit. Others believe in creating open systems where all types of devices from third-parties can work together, which is ZigBee’s aim with its protocol and Dotdot application layer. However, this is easier said than done.
Enter the Hub
Gateways, or smart home hubs, have emerged in recent years to address this issue. Hubs enable direct communication between devices (and often the cloud) by being embedded with multiple radios, which mitigates issues associated with a lack of interoperability. Some hubs are also capable of processing information locally, and don’t require a connection to the cloud, which addresses issues associated with data privacy and security. While devices like Amazon Echo and Google Home foster communication between devices via cloud-to-cloud integrations, hubs allow devices to rely less on the cloud and to communicate with each other directly.
However, one of the major issues with hubs is that many serve virtually no purpose other than fostering interoperability. They are simply boxes embedded with radios—no screens, no voice activation, no additional use case served. For example, the Wink hub, Samsung SmartThings hub, and the Philips Hue bridge provide no additional value outside of connecting compatible devices to each other and the cloud. Manufacturers recognize this as an issue, and have begun to embed the capabilities of gateways into the existing infrastructure of the home. For example, the Amazon Echo Plus has been equipped with a ZigBee radio, which means ZigBee devices can communicate directly with the Echo Plus and the cloud; Comcast has begun embedding multiple radios in its newest Xfinity Wi-Fi routers to act as home automation hubs.
Do Data Privacy Concerns Represent the Hubs’ Saving Grace?
This trend begs the question of the fate of smart home hubs. Will these devices persist as a means of fostering interoperability in the home? In markets more concerned with data privacy, like Europe, hubs may endure as regulations give incentive for keeping consumer information more local. Hubs can also serve a useful purpose in verticals like new construction, where builders need to choose solutions that are open. However, most industry experts say no, these devices will vanish as there is consolidation among tech vendors and networking protocols, and their functionality is embedded in a home’s infrastructure. Navigant Research expects this scenario to dominate market activity, which is demonstrated in the upcoming Residential IoT Market Overview report.