One significant challenge with the smart home: it has many moving parts. From protocols and interoperability to professional and DIY, the smart home is far from straightforward.
Platforms that are the backbone of smart home, are meant to bring order but often only add to the chaos. The reason – fragmentation. Although there are dozens of platforms, most are very similar, which only adds to the confusion of device manufacturers and service providers. To help simplify the smart home, IHS identified three types of platforms: device enablement, open cloud and smart home device.
Analysis
- High-growth and fragmentation for platforms
At a top level, smart home platforms enable enterprise customers to manage multiple devices across an open or closed ecosystem and collect actionable data. Fundamentally, a platform acts as a system of record for connected products and allows users to manage such devices. The global market for smart home platforms was worth about $540 million in 2016 and is projected to exceed $860 million globally by 2017.
Three Types of Platforms
- The first of the three types of smart home platforms is device enablement, also known as connected product management, companies. This type of platform focuses on connecting individual original equipment manufacturer (OEM) devices, more specifically taking devices that were previously not connected and applying connectivity to allow for remote management and automation. Examples include light bulbs and garage door operators.
- Secondly, there is the open cloud platform, primarily a business-to-business (B2B) approach that focuses on carriers, security dealers and security companies. These types of platforms focus on providing end-to-end services and horizontal integrations, also known as integrators and aggregator of devices and services.
- The third and final platform, smart home devices is a business-to-business approach focused on the do-it-yourself (DIY) market. These platforms include Nest, SmartThings, Iris and Wink. Although these platforms are more focused on the direct to consumer approach, some, such as NEST, also work with utility vendors so that there is an element of B2B services through data collected from hardware business. These platforms have their own defined product sets supported by a cloud platform and most of these tend to offer security as part of their solution.
Ecosystem control is critical
- When choosing a platform, an effective provider will be open and horizontal. The ability to bring devices into the ecosystem, test and certify their capabilities and offer to customers as part of a device library is necessary.
- Overall, controlling the ecosystem through vigorous independent and in-house testing will ensure a positive end-user experience and compatibility for installers. Although this creates a closed system, non-listed devices could still be compatible with limited functionality.
- Scale and scalability is very important. Most enterprise customers (telecommunication companies) are not interested in relatively less lucrative ancillary services. Most telecommunication companies that are becoming more heavily involved in IoT and smart homes are looking for a quad or quintuple play.
- Lastly, a platform that is connectivity agnostic is an important factor. Due to the complexity and fragmentation of the smart home, platforms need to be able to work with any device that has a processor and can send/receive data. Scalability in connectivity is also a differentiating factor. The applicable data needs to get to the right device so the management layer can help build relationship mapping to give structure and meaning to datasets and apply it to other business services in an organization.
- Overall, the use of third-party platform providers will provide a faster-time-to-market, risk mitigation and assist with integrations into larger ecosystems.
By Blake Kozak, principal analyst, smart home and security technology, IHS Markit
