25 March 2019 By Ashley Rose
It is a fact that our homes are becoming smarter. The smart home sector is consequently growing at a rapid pace, but how big is this sector, really? Who are the players to watch? What are the major challenges that the smart home industry faces? We gathered all essential facts and figures for you in this article. According to data collected by research agency ABI Research, the smart home market is one of today’s fastest-growing markets. In 2018, we spent a global total of $56 billion on smart applications for use in and around our homes. This figure is expected to grow to $123 billion by 2022. The largest subsector of the smart home market is that of home security. According to research agency Markets and Markets, we will spend more than $74 billion on smart smoke detectors, alarm systems, security cameras and other security products by the year 2023, compared to $40 billion in 2017.
Submarkets
No matter how large the market is, it is still in its infancy. Countless businesses are looking to get in on the action and enter one or more submarkets, which means consumers can choose from a wide range of brands. ABI Research identifies more than 150 producers in 6 submarkets:
1. Entertainment and media (e.g. home-theatre systems) 2. Energy (e.g. climate control) 3. Security (e.g. burglar alarms) 4. Household appliances (e.g. air-quality systems) 5. Health (e.g. health-monitoring systems) 6. Personalisation (e.g. voice-controlled products)
A different operating system for every device It is easy to see how a home can become cluttered with so many different systems. Smart lighting by Philips, a Samsung camera system, a smart doorbell made by Amazon, Google’s voice assistant, a connected scale produced by Nokia and an Apple smart TV – each of which has its own apps and operating system!
The market is fragmented at the moment. Every producer is developing their own system in hopes of winning and retaining the customer’s loyalty. A single universal system to which you can connect all your smart devices does not exist yet – but you can expect it will be in the future. For example, various apps and web applications that can combine different systems are already being developed. A great example is 'Life Smart', an app that can easily connect different apps and devices.
Smart appliances contain a wealth of data. You can literally see into people’s kitchens with these devices. Take a smart oven, for example. It records how often and when it is used and what dishes are cooked with it. This is invaluable market information that you can use to improve your products and user experience!
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