iot innovations & the smart home · •iot smart home - - early stages of connected home -...

/ ©2016 NAVIGANT CONSULTING, INC. ALL RIGHTS RESERVED1 Confidential and ProprietaryConfidential and Proprietary

NAVIGANT RESEARCH

IoT INNOVATIONS & THE SMART HOME

/ ©2016 NAVIGANT CONSULTING, INC. ALL RIGHTS RESERVED2 Confidential and Proprietary/ ©2017 NAVIGANT CONSULTING, INC. ALL RIGHTS RESERVED2

BUILDING

INNOVATIONS

Intelligent Building Management Systems

Residential Energy Innovations

Energy Efficient Buildings

Lighting Innovations

Smart Cities

NAVIGANT RESEARCH

TRANSPORTATION

EFFICIENCIES

UTILITY

TRANSFORMATIONS

ENERGY

TECHNOLOGIES

Wind Energy

Grid-Tied Energy Storage

Distributed Energy Storage

Advanced Battery Innovations

Microgrids

Distributed Natural Gas

Distributed Renewables

Electric Vehicles

Fuel Efficiency and Emerging Technologies

Mobility

Transportation Forecast

Internet of Things

Connected Grid

Digital Grid

Dynamic Grid

Demand-Side Management

Digital Utility Strategies

DER Strategies


THE INTERNET OF THINGS


IOT IS AN ENABLING TECHNOLOGY

/ ©2016 NAVIGANT CONSULTING, INC. ALL RIGHTS RESERVED5 Confidential and Proprietary

IOT SMART HOME VISION

• IoT Smart Home -

- Early stages of connected home

- Smart home moves beyond connected devices to

integrated system with intuition and intelligence

• What to expect

- Transition from point solutions to comprehensive

solutions

- More connected devices

- More automation, efficiency

- Smart home as a grid asset, a node in the Energy

Cloud

- IoT powering this transition

(Sources: ArchTen, NHTSA, liveworkstudio)


IOT TREND IS HERE, AND ACCELERATING

NEWER PLATFORMSAmazon Alexa, Google Assistant,

IBM Watson

CONSUMERS READY

Smart thermostat penetration ~5%↑65% excited about smart tech (PwC)

MERGER AND ACQUISITION SPENDSoftBank buys ARM Holdings, Dialog Semiconductor buys Atmel,

Cisco acquires Jasper

1

2

3

The early hype of IoT is being replace by action


WHAT IS DRIVING THIS MARKET?

Growing consumer awareness of devices, benefits (e.g., energy management)

Enhanced, affordable home security systems

Proliferation of mobile devices and apps

High penetration of in-home networks

Wide area connectivity

Falling IoT component costs

Easier installations

Insurance discounts


IOT ADOPTION INCREASING

• Device shipments are

expected to grow

• Smart meters:

- 49.5 million to

106 million in 2026

- Compound annual growth

rate (CAGR) of 8%

• Smart thermostats:

- 5.7 million to 22.6 million

- CAGR of 14.7%

• Smart appliances:

- 2.8 million to 93 million

- CAGR of 41.8%

Residential IoT Device Shipments by Type,

World Markets: 2016-2026

-

50

100

150

200

250

300

350

400

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

(Millio

ns)

Smart Meters

Smart Thermostats

Lighting

Smart Appliances

Security-Home Management

Smart Plugs

EV Charger

Solar PV

Energy Storage

Other

(Source: Navigant Research)


IOT: OPPORTUNITIES & CHALLENGES

• While the IoT market is here, it is still emerging

• Challenges:

- How to transition this market from “the chasm” to mainstream adoption?

- How to deploy IoT solutions and provide lasting value to connected devices through

services?

- How to monetize this market?

(Source: Navigant Research)

IoT Device Adoption Curve


MARKET BARRIERS

• Barriers exist and need to be

overcome

- Numerous protocols

- Smart devices are still premium,

expensive, and not affordable to the

masses

- Overall smart home awareness still

lacking

- Fear over loss of privacy

- Security concerns

- Unclear value propositions

- Lacking in critical use cases

• How do stakeholders overcome

these challenges?

Sampling of Communications Protocols

and Standards

(Sources: Apple, Ayla Networks, Bluetooth SIG, Thread Group, Z-Wave Alliance, ZigBee

Alliance)


BEST PRACTICES

• Interoperability

- The IoT is fragmented and the success of this market relies on interoperable platforms and open ecosystems

• Comprehensive solutions

- Transitions the market from point solutions to comprehensive platforms with on-going services

• Hybrid technologies

- The cloud is the future of IoT, but there are applications where analytics at the edge make more sense; combine solutions to

maximize efficiency of a system

• Data privacy and security

- Vendors must ensure security of solutions and inform customers about data privacy to foster trust in IoT market


COMPETITIVE LANDSCAPE

Transition from point solutions to comprehensive platforms by

expanding through value chain or partnerships.


IOT BUSINESS MODEL FRAMEWORK

Devices

Apps

Services

Product

Platform

Ecosystem

Transactional

Transactional

or Recurring

Recurring

Offering Revenue Value Capture

Set the right price

Provide personalization and

network effects

Create a solution

IoT Stack

Goal of the market is to transition from one-time transactions to recurring

revenue through value-added services.


KEY TAKEAWAYS

The IoT trend is here and accelerating

Drivers:

- Device adoption, clarity around value propositions

- Early adopters

- Story of the consumer

Barriers:

- Real, especially security threats

- Can be overcome

Plenty of uncertainty at this early stage, similar to the Internet in 1995

Smart products and services go beyond just connected devices, toward

intelligence and comprehensive platforms through integration, which leads to

smart home that can be used as a dynamic grid asset


PAIGE LEUSCHNERResearch Analyst

+44 (0) 738 702 3898

[email protected]

CONTACT INFO

iot innovations & the smart home · •iot smart home - - early stages of connected home -...

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