In the United States, the sales revenue of smart home devices, including smart thermostats, smart smoke and CO2 detectors, IP/Wi-Fi cameras, smart locks, smart home systems, and smart switches, dimmers and outlets is predicted to reach $1.2 billion in 2016, and the sales volume to reach 8.9 million units in 2016 with 21 percent increase, according to research...
In the United States, the sales revenue of smart home devices, including smart thermostats, smart smoke and CO2 detectors, IP/Wi-Fi cameras, smart locks, smart home systems, and smart switches, dimmers and outlets is predicted to reach $1.2 billion in 2016, and the sales volume to reach 8.9 million units in 2016 with 21 percent increase, according to research done by the Consumer Technology Association (CTA). Eyeing the billion-dollar market, MivaTek Limited believes its key to success is by providing an integrated solution that combines wireless, mobile, and cloud technology. All of the hardware and software should be managed under one app.
MivaTek CEO Joe Liu said, “We are selling services, not just the device itself. By far, we focus on self-monitoring and self-protection solutions. What make our systems special are that all the devices are controllable via one app, which allows multi-location, multi-user control premium features and authorization mechanism.”
MivaTek has B2C and B2B business units. The company offers a one-stop shop for smart home monitoring and protection solutions to enterprise and consumer markets. The systems for end users includes an intelligent hub, HD camera, and sensors. The company’s B2B business target service providers, enterprises (including OEM/ODMs), and resellers/integrators by providing turnkey solutions and private-label manufacturing service. Its product portfolio comprises Home Awareness, Video, and Smart Care lineups.
“When we look at the technology adoption life cycle, we think the smart home market is still in the second stage where the consumers are mostly early adopters. We need to cross a chasm before we reach mass adoption.” said Daniel Wong, Worldwide V.P. Sales, Marketing, & Product Line Management. According to statistics from Statista, although there are more than 70 players in the space, there are less than 5 percent of global market penetration. “There is still a lot of business opportunity over the next few years,” he added.
How to cross the chasm
Wong explained the challenges that may hinder the market growth and mass adoption. “Users have no idea of how to choose the right solution if they don’t have enough IoT knowledge. There are lots of wireless technologies and IoT platforms that are not unified, and interoperability problems among different brands.” Providing a technology- and device-agnostic platform like MivaTek’s IoT Smart Living Platform is a popular way to solve the problem. “We unify communication in our cloud platform which provides data storage, multi-location connectivity, multi-user support and security integrated video. Our platform is flexible and open.” said Wong. The company wants to build a multi-partner cloud that collaborates with Nest, Honeywell and more. That way, users no longer have to worry about interoperability amongst devices.
Wong believes one major barrier appears to be awareness itself when it comes to certain devices. According to a Harris Poll Survey taken in May 2015 across 2,225 adults, 51% of survey respondents have never heard of water detectors that connect to Wi-Fi, and 42 percent say the same for connected laundry machines. How to raise the consumer awareness is as important as to alleviate the initial hesitance toward purchasing certain devices despite respectable awareness levels.
Boosting market adoption
Creating great user experience is equally important to a magic price point. Part of that great user experience comes from easy device pairing, simple device installation and ease of use. “We try to simplify our systems, and make them more affordable for the masses. Ease of installation is essential to drive the success.” Wong further explained that there can be as much as a 20% return rate as a result of a poor user experience. The company provides factory level pre-paired devices so that consumers can install the system in minutes. “We provide pre-paired devices before they are shipped, thus providing an easy setup process. Also, our solution allows for instant video sharing via email, text, or social media, providing an easy-to-use experience.” He stressed that all the devices can be monitored and managed via one app which is very important, and it can avoid user frustration and inconsistent user experiences. “Consumers may have multiple point solutions, and many apps. Nevertheless, they need only one app. Customers want a simple experience with one app to manage their smart home.”
When it comes to pricing strategy, bringing down total cost of ownership is crucial to fasten market adoption. “The consumers who can afford a $299 thermostat with extra installation fee generally have $100,000 annual income or above in the U.S. These particular consumers account for only 2 percent of the U.S. households. For the mass consumer market, we have to take on a different approach. These are consumers who have a median income, at around, $50,000 per year and they represent about half of the U.S. population. These consumers tend to look for more affordable price points like a $99 thermostat and it can be installed by themselves,” explained Liu. “You can easily spend thousands of dollars to make your house smart now. But at Home8, our goal is to provide affordable price points to the mass consumer. Our starter kits starts as low as $179, each of which encompasses an intelligent hub, an IP video camera, and sensors,” said Wong.
Addressing security and privacy concerns
Consumers have concerns over Internet security like where the cloud platform provider keep their data, and will they sold the users’ personal data. The company believes that it’s safer to save personal data in the home hub, also called a personal cloud, which creates a closed and firewalled secure network. To enhance security, the company’s intelligent hub Shuttle features 256 bank-level encryption, a patented anti-sniffing technology to block invalid access and a sniffer against intruders. To create value, the Shuttle is a multi-functional router that can work as a siren, NAS, router, and home controller. MivaTek HD cameras store video onto microSD drives with the option for automatic backup to Dropbox. This means that MivaTek cannot store or access to users’ recorded videos.
With regards to the authorization mechanism, there are three layers in its Home8 Cloud, including owner, authorized users and emergency contacts. This multi-tier, multi-user application is part of Home8’s group monitoring feature that allows the owner to give access other users (such as family, friends, neighbors or caregivers) to monitor and manage the system and its devices. In addition, the owner and its authorized users have the ability to reach out and call directly the emergency contacts (whether it be a neighbor or the local police) if warranted. . If the owner and its authorized users do not respond to a triggered system alert notification within 5 minutes, then the emergency contacts will be sent a SMS text message.