IoT in the Home: Market Characteristics
February 12, 2016 1 Comment
The home automation market is undergoing a progressive transformation propelled by the proliferation of smartphones and tablets. In addition to cellular technologies, home automation devices integrate different local and personal area technologies to connect among peripherals. This led to a new phase of evolution in home automation systems where wireless technologies enable connectivity for monitoring and control from anywhere at any time. Home automation solutions have broken through the early-adopter market phase. Mass market adoption on the other hand is yet to materialize leaving a great potential ahead for the next phase of development in a very dynamic market that’s in the process of being defined. In this paper, we outline the main characteristics of the home automation market and expose trends are shaping the market, raising challenges, and creating new opportunities.
The home automation market comprises multiple segments, including:
- Lighting control (e.g. switches, dimmers)
- Security & access control (e.g. video surveillance, intrusion detection)
- HVAC control (e.g. thermostat)
- Entertainment control (e.g. home theater)
- Outdoor control (e.g. landscape)
We observe the following characteristics of the market for this market which outline the dynamics among various stakeholders:
Silo segments: The market is siloed into segments without support for unified interface or interaction. For example, HVAC is independent from security control systems leading to different user experience.
Fragmented use cases: Distinct use cases and applications result in fragmentation across multiple fault lines including markets and technologies.
Uneven adoption: Some market segments are more mature than others, in part due to market and distribution channels. For example, HVAC and security control are well established while lighting control is emergent propelled by regulatory requirements and incentives especially in EU countries.
Non-interoperable technologies: Vendors select the technology and protocol stack that best meet the application requirements leading to a proliferation of non-interoperable systems. Attempts are underway to bridge this gap through industry alliances and organizations which began taking shape in late 2013 and has accelerated since.
Security risks: Security shortcomings are alarming across a wide range of products. Examples include lack of enforcement of strong passwords, non-existent support for mutual authentication, or absence of protected accounts against brute-force attacks. Mobile applications are specifically vulnerable with estimated 20% not using encrypted communications to the cloud.
Inconsistent performance: Reliable connectivity is lacking due to a complex deployment scenario where signals could easily be blocked or be subject to interference from other systems operating in the same spectrum.
* This is the first part of a multipart article. This is a link for the full article.
 HP, “HP Study Finds Alarming Vulnerabilities with Internet of Things (IoT) Home Security Systems,” February, 2015.
 Symantec, “Security Response: Insecurity in the Internet of Things“, Mario Ballano Barcena and Candid Wueest, Version 1.0, March 12, 2015.