At first glance, the notion of a connected home sounds pretty exciting. But soon you realize that like “digital convergence” or “social networking”, it’s not a very specific term. For example, it’s not something you can buy from a vendor or from a store. It’s also not something you can explain in a single sentence. Often, it leads to more questions than answers. Connected home? Connected to what? Why? And how?
The attendant problem is that in the wake of cloudy buzzwords such as home networking, every part of the market tries to define the problem to suit their products. Back in the days of “knowledge management” – data mining companies would insist knowledge was about finding patterns in stored data, while collaboration tools providers would insist that knowledge management was about enabling people to share information to build a common body of knowledge. That market never quite took off.
So what exactly is a connected home? And how does it differ from “home networking”?
Actually, going by “product/ benefit” based segregation; there are actually 5 different markets within the idea of a connected home. These are productivity & communications (PC, Laptops, Printers, mobile phones), Entertainment (TV, PC, Mobile, Set Top Box, gaming consoles), Energy Management (smart meters, intelligent devices), home security (remote home management & surveillance, IP enabled cameras) and Assisted Living (home automation, tele-medicine). The examples of product categories in the brackets is not meant to be either comprehensive or water-tight. For example a part of the home automation market is simply a luxury service aimed at the well-off, and there are plenty of products which will serve more than one market.
This picture attempts to show the way these markets are currently set out across the connected home landscape. What became apparent at the Intellect Convergence Conversations on the subject, in October 09, was that there is a strong polarity in this space between the two ends of this market. At one end is the “here and now”, market-driven, consumer pull based market for media/ entertainment/ productivity services. Essentially this involves hooking up all your computing, printing, phone and media devices to a preferably wireless home network, so that you can move media from one to the other, control one with the other, access one from the other etc. For example, a movie site can be accessed by a phone while on the way to work, and set to download over the Internet to a hard drive in the study and played off a TV set in the living room. Clearly there is much activity in the market for products along these lines and enough marketing money is going into expanding this market. Screen Digest estimate that there will be 50 million connected devices in the home by 2010 – and we can safely deduce that most of these will be at the media and computing end of devices.
At the other extreme, you have the assisted living market. This involves providing home automation services mostly to people who need as much as want them. This includes the large numbers of elderly people who would benefit greatly from simple automation and tele-healthcare services. Connected blood pressure measuring devices, NHS reminders that get delivered to TV sets, these are some of the obvious areas where this could make an impact. The problem is that the number of people who will need these services will greatly outweigh the number that can afford them. Also, the cost and effort it will save is currently being born by the government/ NHS in the UK. So there is no real incentive for consumer adoption, and in the absence of a publicly funded initiative, there are no providers rushing in to deliver services either.
In between you have the home security market, which many see as a Trojan horse. In the US some 40% of all new homes have home security and surveillance equipment fitted. In 2007, there was a news story about a family who were on holiday and saw their house being burgled on the web cam they had set up. They were able to call the police and have the thieves apprehended before they left with the loot. Companies who are able to sell the home security devices into the home could upsell a number of other devices, especially if they are a trusted brand.
There is also the energy management market, where clearly the poster child is the smart metering initiative. Smart metering has become a buzzword by itself with the government looking to roll out smart meters across the country by 2020. Of course, 11 years is a lot of time and many governments could have come and gone by then, but with growing concerns about the environment, smart metering may well be the focal point of consumer initiative in energy management. Needless to say, for a country like the UK, this means replacing the entire installed base of meters, a much more expensive task per capita than, say, in a country where there are many new houses being built, such as India and China. Additionally, smart meters need smart devices. We need, over time, to replace all our appliances and electricals with electronics. Or devices with a chip, some memory and some processing power. But even by conservative estimates, if half the 25 million households implement smart meters and replace on average 6-8 electrical devices with smarter ones, you can do the maths on the market size. And then there’s Europe, the US and the rest of the world.
So what’s the problem? Why are we not skipping merrily along to the promised land where all devices are inter-connected and our lives are made much simpler?
The funny thing about standards is that more means less. When you have one standard, you have a standard. When you have three, you actually have none. And this is one of the biggest hurdles in the race to the connected home.
With DLNA being one of the leading and established standards, one might have thought it was a done and dusted issue. DLNA (www.dlna.org) reports that 5,500 different devices across brands are currently DLNA certified. 170 different TVs were certified in the first 6 months of 2009. Windows 7 is DLNA compliant. Over 200 million units were shipped this year with DLNA compliance, with the number set to hit 300 million per year by 2012. The UPnP architecture has been recognized by the ISO and the IEC as the architecture for interoperability of home devices. And yet, there are other standards such as Playsforsure, TAHI IFI and MoCA(Multimedia over Coax Alliance). In reality there is also a hierarchy of standards. DLNA is an overarching standards body that is actually a collection of standards. For example MoCA, along with WiFi and Ethernet are all LAN standards approved by the DLNA.
For the consumer though this only means jargon and doubt. And while every technology company executive will tell you that the consumer does not care about the technology, the reality of some markets is that consumers have to care. For example, they had to care while buying HD devices till last year and spend time worrying which of the BluRay or HD-DVD players would be a good investment and which would be a waste of money. Today’s consumer looking to hook up a wireless home media network certainly has to worry about proprietary standards and be careful to lock himself or herself into a standard that tomorrow, will be dropped by the industry. At the very least, today’s consumer has to worry about going with Apple’s proprietary technology versus almost anything else.
There more. Any network has some standard features – including a hub, a gateway, security mechanism and identity management for all the devices and users on the network. Now imagine that you actually have 5 parallel networks in your home, each with its unique security framework. With 4 people in the family, that’s 20 sets of user id’s and passwords. Not to mention the threat of illegal access to the network, data and identity theft and virus protection!
It’s also fair to assume that these networks will all need to speak with each other at some level. For example, your smart-meter wants to read the power consumption off your TV set. This means that each network will need to have a way of interfacing with the other networks. That’s 5 networks all trying to talk to each other. You work out the permutations.
With all these challenges, it will be a miracle if the connected home suddenly becomes a reality with everybody working together to agree standards and move the market forward. And this is why, despite the wonderful picture it paints, we will all be jogging slowly to the world of the connected home.
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