By Ian Johnson, Director, Junction Ltd.
After what was perceived to be a relatively slow start for the industry – things are finally making progress.
The Connected Home Conference – September 2003 – focused on partnerships to really push the industry forward. The technologies are in place and the service aggregators are ready – the challenge is communicating this to the marketplace.
As commented by the previous review of the September event, there were a lot of top level – strategic overview speeches that really gave an important insight to what each sector was doing and allowing networking opportunities. This is great for those at a senior strategy level, and we have retained some of this for the April event. However the practical element, the hands on stuff, will also be focused on much more.
Partnering with Cedia, we’ve introduced an important section on construction and installers with a session chaired by Steve Moore outlining the latest practical projects. Also, there are two interesting speeches from Abrocour (who have partnered with the likes of Berkley Homes, Intel, HP and Microsoft to help deploy their services), and ConvergeX who are partnering with Linden Homes to launch a raft of new services.
The April event will also have some very interesting insights and learning from the US market from companies like GE Interlogix, Windows eHome, and Whirlpool, and Parks Associates all venturing over from across the Atlantic.
So, what are the current market trends?
Abracour CEO Sam Sethi explained to Digital Lifestyles: “Wireless solutions are becoming faster and safer, and are gaining in popularity with consumers, as people want access to their data, video and audio on the move. As the government pushes ahead with its new Building Regulations (Part Q) stating that all developers should provide the capability for broadband Internet in new homes, we expect to see a big uptake in housing developers installing wireless.”
This has important implications for the housing market, as Sethi pointed out, “Housing developers are realizing that wired solutions are costly and cumbersome, and that wireless home network solutions offers house builders and architects a cheaper and more efficient alternative.” (For more information on Abrocour, see the link below.)
This in turn provides a new angle for the way homes are marketed and the perceived value add it delivers for consumers. Matthew Bramble, Technical Director, Opus Technologies described that, “Its now widely accepted that modern entertainment technology genuinely attracts new home buyers and adds to a home’s perceived value. We recognized early-on that home builders were the key to getting this exciting technology into the home and have consequently striven to design products ideal for new build. We have made it a priority to partner with new-home builders world-wide and have enjoyed particular success where we have focused on creating customized solutions.”
That’s exactly what the connected home event is about – bringing together industries, and providing a useful link between home builders and technology companies, and enabling them to partner to deliver services to the marketplace.
We began the September 2003 event by defining ‘What is the connected home’?
“We believe it should be based on real people, living in real homes and not on technologies or esoteric finances, or lifestyles that don’t mean anything to people out in the street. It’s about connecting things simply and wherever I want to connect them in my home,” said David Sales, Director of Home Communications, BT.
Strategies for the market
The 2003 conference stressed that by using an ecosystem strategy to develop the home technology market – as an end-to-end service experience for the customer – it would make it simpler for them to build that system themselves.
Many speakers were thinking holistically about the broadband ecosystem in the home. They viewed broadband as feeding that system, at the heart of the connected home – bringing things alive. The Connected Home must feed consumers desire to work, play, and relax and even to be able to monitor all things going on in the home. Broadband was seen as important in setting this market alive, however, ‘partnerships’ are the key to driving the market forward.
Thomas Hott,, CEO of ProSyst Software AG, told me: “One of the discernible trends at present is a movement away from piecemeal home networking offerings to more comprehensive solutions. People realize the need for an integrated platform to connect devices of any kind and regardless of who produced them. Consequently, a standards-based approach is in the interest of all value-chain participants – from manufacturers to service providers and end users.”
What will drive the connected home?
In addition to forming alliances, many see entertainment in the connected home as the main driver. It was commented that people are willing to pay to enjoy themselves and that generating excitement and enjoyment in these services, with easy to handle technologies would be key.
“‘Enhanced features’, costs savings and ease of use are really the things that will drive this market forward” explained Michael Gannon, Senior Market Manager, Motorola Broadband. Gannon. “At the moment we are seeing competition is greater in Europe than in the US, in the connected home arena. The competition between DSL and Cable as the enabling technologies are driving the market, and we are seeing the acceptance of connected home products going down well in Europe, due to this competition. This is driving the market slightly more than in the USA.”
Looking at the different types of product on offer, “Numerous attractive new smart home products have reached the consumer in recent months. Through major contributions to such products – including a Motorola smart home gateway, the Philips iPronto and Bosch Siemens’ serve@home solution – ProSyst has played a crucial role in furthering this market with its OSGi-based end-to-end solutions,” outlined Daniel Schellhoss, ProSyst Software AG.
In order for the networked home to be a success there has to be a mass market. In the US the connected home market came to life in the retail market and online, whereas in the UK retail has not yet proved to be a very strong route to market. Many asked whether the UK retail industry would be supporting this market growth in a similar way?
Delivering Services
Entertainment, home care, remote control and security services are all becoming more important for the consumer, and the focus on these services was well received. Also, important other markets emerged in home care and control. This was highlighted by the West Lothian Council case study. This showed us the opportunity to embrace the potential of the technology in the way of changing lives of citizens, and helping to tackle social inclusion.
To make services available for the mass market, many were convinced something has to change in the market – and this was likely the role of the home service aggregator. Many cable, Telco and utility companies are looking to develop this role in the market. This involves combining portfolios of services and delivering this in an easy way to the end customer which makes higher quality of service.
“Manufacturers look for new ways to not only reduce their maintenance and development costs but also to enhance their market share by offering new and attractive services, that constantly grow in volume and content variety. An important factor that affects not only the manufacturers and operators, but also the consumers’ interest in new services and customer loyalty is the delivery, installation, activation and maintenance of new applications and services in a safe manner. By providing simple and convenient solutions we reduce barriers to adoption that remove the burden of complexity from the consumer’s hands and help manufacturers to reduce maintenance costs up to 30%.”, explained Dr. Susan Schwarze from ProSyst Software AG.
Understanding consumers
IBM outlined its role in understand the behaviour of consumers when dealing with complex technologies. “What is the reason to use these technologies – it’s all about services” commented Ralph Baral, Smart Home WW, IBM.
Understanding what exactly the consumer are doing, their behaviour and how much time they are spending using these technologies and how it is effecting their lives. The general consensus among speakers was that the consumer is becoming far more technology literate, and this is influencing the way in which technology and media companies configure their services.
Whilst they are becoming more technology literate, most speakers emphasised the need to keep the complexity for the end user at the lowest level possible – and that it was still the problem today.
April 21/22nd, Connected Home, 2004 event
The April event this year will receive yet more focus on service deployment and provisioning in the industry, but importantly will also include a focus on the construction industry. Four of the leading UK property developers will be speaking at the event, and offering their views on the different types of connected home project they have been undertaking.
ConvergeX, the digital homes solution company, is one such organisation partnering their home control middleware software with leading UK property developer Linden Homes.
Jostein Svendsen, Managing Director of ConvergeX commented that, “2004 is the year where Digital Homes will take center stage as many major companies are moving into the market place and positioning themselves to drive the market forward. But even if the larger players will supply the devices, the innovation and applications will found in the smaller companies. This is where Europe can play a main role – delivering leading edge applications to enable the digital home revolution.”
This focus on the building industry was something emphasized by Opus Technologies, and exhibitor at the 2003 event. Matthew Bramble, Technical Director, Opus Technologies described that, “Its now widely accepted that modern entertainment technology genuinely attracts new home buyers and adds to a home’s perceived value. We recognized early-on that home builders were the key to getting this exciting technology into the home and have consequently striven to design products ideal for new build. We have made it a priority to partner with new-home builders world-wide and have enjoyed particular success where we have focused on creating customized solutions; solutions which are not only product but a fully realized support package which includes marketing, project management and installation services.”
Svendsen from ConvergeX echoes this sentiment, ” We look at the market and are tying up with players in a number of ways. We are initially targeting property developers and authorized re-sellers and will later license the software to be installed in various home devices. Even though we are starting deployment in the mid to upper end of the market – we will ultimately achieve mass market adoption by being available on millions of devices being sold to the home.”
Summary
The broadband home is here today, and the connected home is coming. Everything is available today, we have connectible devices and service aggregators – the question asked was how do we move forward to this integration environment? The technology is already here, the big challenge is how we market it to the right people? How do we communicate to the marketplace?
Jostein – “The connected home of the future is not about having massive amount of technology on display. The good solutions are the invisible ones, the ones that always there to help you and make your life easier, but you don’t have to think about them.”
Consumers are getting used to the concept of the home network. “The networked home really has a future, but as far as the mass market is concerned I think we really have to find out what that is” summarised Andrew Mullen, General Manager Communications and new technologies, LG Electronics UK.
Convergence is really re-defining the industry today as connected devices are emerging and as Mask Ossel, VP and General Manager, EMEA, Echelon outlined, “many companies underestimate t he speed of change.”
As we plan for the next connected home, April 21/22nd 2004, we are considering the comments throughout out the 2 days, and are looking to help the industry understand the issues that it faces, and helping drive this market forward.
We look forward to seeing you at The Connected Home 2004.
More information on the Connected Home event – can be found at – The Connected Home or by calling Ian Johnson, Director, Junction Ltd, 0044 1179042004, [email protected]