The connected home market has been in a slump for several years. It will be interesting to see if the pandemic and the resulting shelter-in-place orders help boost the Smart Home industry’s growth.
IoT research firm, Statista recently released a report that indicated that the global smart home market could grow to as much as $53.45 billion in size by 2022. Veego Software, an Israel-based AI startup for the connected home, responded to this report with several predictions of its own for 2021, and I think they bear some evaluation.
Prediction 1: Data Continues Its Importance
The first prediction won’t surprise anyone: Data will continue to be important. Veego said that AI is going to be a source of the data that Smart Home enablers need, through both generation and collection algorithms, but I think this might not go far enough. For Smart Home to provide enough value for homeowners and developers to begin to see the benefits, AI is also going to have to get much better at predicting user needs, automating processes, and, most important, reducing costs of ownership. It isn’t doing that yet, and before Smart Home sees growth, AI had better get smarter.
Prediction 2: Connectivity
Second, Veego looked at connectivity, specifically WiFi 6, and said that this new protocol would take over. I mean, sure, people will always want the next best thing (see: 5G), but that doesn’t mean that it will enable growth. This 802.11ax bandwidth reportedly does deliver better security capacity and data rates, which is where Veego got it right, I think. Homeowners are becoming voracious consumers of bandwidth, and more is what they want. Of course, the ISPs will have to get in line and stop throttling that traffic, or the revolution isn’t far off. And by revolution, I mean cellular. (Hello again, 5G.)
Prediction 3: Customer Experience
The next prediction was less about encouraging Smart Home adoption and why the IoT should be more invested in making it happen. Veego said it sees 2021 as the year when Communication service providers, media companies, and smart device manufacturers will start to leverage Connected homes for measuring Customer Experience. This might be true, but the data won’t have much value until there is an exponential rise in the technologies’ adoption. Along with adoption, the industry also needs to figure out how to incentivize homeowners to opt-in to share that data.
Veego wrote that connectivity malfunctions would be moving toward the devices because the routers and gateways are improving. This is undeniably true, but the company’s further prediction that these problems will more often originate in the Smart Devices themselves is problematic for the segment’s growth, to say the least. One of the constant obstacles faced by Smart Home is that homeowners and building managers don’t see the tech as necessary, just nice-to-have. If you’re lucky, if that moves to annoying, we’re all in a lot of trouble, so OEMs had better get on the QC.
The Smart Home market has an opportunity, but the opening offered by COVID-related sheltering in place is no fait accompli. Smart Home product manufacturers and providers better get all their ducks in a row, or the pandemic is more likely to offer more of a coup de grâce.