Smart home industry has had a great year in 2018. Big brands have grown stronger, while smaller companies have united. Adoption of voice assistants has brought higher smart home awareness among end-users.
Smart home products were under the spotlight at CES 2018 and the industry has had a great year. Big brands have grown stronger, while smaller companies have united. Adoption of voice assistants has brought higher smart home awareness among end-users.
The total value of smart home device shipments will grow from US$166.7 billion in 2017 to US$210.3 billion in 2018, representing a year-on-year increase of 26.1%, according to research firm IDC’s forecast. Shipment value will rise to US$339 billion in 2022 at a compound annual growth rate of 15.2%.
Alexa is everywhere. At the beginning of the year, Amazon announced two smart home startup acquisitions deals. It purchased security camera firm Blink and smart doorbell maker Ring
. Blink contributes its security camera technology and low-power consumption chip, while Ring offers smart doorbell and home security system to help Amazon compete with Nest, Google’s smart home arm.
Amazon showcased its hardware manufacturing power at the September hardware event, where the company introduced a new lineup of Alexa-powered devices. The Echo Dot, Echo Plus and Echo Show were all upgraded. New devices with Alexa built-in are the Echo Input, a small gadget which turns every speaker into an Alexa-powered one, and the Echo Auto, that brings Alexa into every car which does not have Alexa included in the in-car software.
Several Alexa-compatible devices were also announced, including the Echo Wall Clock, AmazonBasics Microwave. There are also devices that aim to improve the Echo sound quality, such as the Echo Sub as subwoofer, the Echo Link and Echo Link Amp.
Ring’s latest Stick Up Cam with wired and battery models were also introduced at the event. The updated version, in addition to improved hardware units, offers integration with Ring’s new Alarm security system and Amazon’s voice assistant Alexa.
Alexa-enabled devices made by Amazon across product categories show the company’s ambition to bring Alexa to as many places as possible, including offices and hotels.
Earlier this year Amazon introduced Alexa for Business, a version of Alexa for the workplace. It lets each company develop the voice skill fitting their needs, to monitor voice skills and devices from their own IT departments and to bring voice to daily tasks with Alexa APIs provided by Amazon.
In mid-year Alexa for Hospitality was announced. This Alexa version, tailored to hotel needs, allows guests to have room services using their voice and bring their Alexa experience with them in hotel rooms.
Voice assistant battles
Another major smart home platform, Google Assistant, has set some milestones as well in the year.
Google launched the Google Home Hub
, its first-ever smart speaker with a touchscreen, to answer the completion of the Amazon Echo Show. Third-party manufacturers including Lenovo, LG and JBL also released devices supporting Google Smart Displays.
Responding to Amazon’s expansion in the smart home market, Google brought Nest back under its arm to be integrated into Google’s home and living room products team. Google still keeps the Nest brand name. With the development, Nest and Google’s home products are expected to have more integrations. For instance, Google Assistant became part of the Nest Cam IQ camera, while Google Home Hub can control Nest devices with native footage support.
Apple, another voice assistant owner, also released its first smart speaker, the HomePod, in February this year. The device has seen little adoption due to its higher price of US$349.
Alexa-Cortana integration became public in August, and combined the strengths from the two assistants. Cortana knows the best about user’s Outlook emails and schedules, while Alexa can help on shopping and smart home automation.
The U.S. has led the worldwide smart speaker sales in 2018. As of May, smart speakers have reached 54.4 million users among the 252 million adult population in the U.S., according to a survey conducted by voice technology firm Voicebot and voice AI platform Voysis. Research firm eMarketer expects 90 million users in the U.S. to have smart speakers at home.
Amazon Alexa had 62% of intelligent assistant market share worldwide by the end of 2017, while Google Assistant had about 25% of the market share, according to research firm Statista. Amazon still leads the market in 2018, although Google Assistant has gained more share. The platform war between Alexa and Google Assistant is like to intensify in 2019.
Join forces to compete
Aside from the battle between Amazon and Google, several companies have teamed up to tackle the smart home market. The smart home market is not a start-up game anymore. It has started to ask for collective capital, technology and talents for companies win a place in the competitive market.
U.S. internet service provider Comcast acquired Stringify in 2017, a platform similar to IFTTT to connect various devices together. The company this year integrated the technology from Stringify and released routines feature for its home automation service.
Long-time HVAC player Johnson Controls purchased smart thermostat maker Lux, aiming to move further in the industry.
Swedish lock company Assa Abloy bought smart lock maker August Home in late 2017, and integrated August Home’s software into its own smart lock brand Yale this year.
U.S. Retail Best Buy acquired GreatCall, a U.S.-based digital home healthcare service provider for seniors, in order to provide digital health services to home with seniors.
Dublin-based smart camera company Smartfrog and New York-based security camera startup Canary combined as one, gathering their strengths in the smart camera market.
Professional security firm ADT partnered with Samsung to bring professional monitoring services to DIY home security devices, which blurred the line between the DIY and managed services.
Smart speaker maker Sonos and smart camera brand Arlo applied for IPO and went public in late 2018. Sonos are known for its multi-platform smart speakers supporting Alexa, Apple AirPlay and Google Assistant, while Arlo makes great home security cameras.
Other public smart home companies include home automation service provider Control4 and home security solutions provider Alarm.com.
All in all, public companies are still rare in the smart home market. However, the fact that some companies are getting listed is still a good sign. “The IPO is a sign that smart-home technology is finally seeing real mainstream consumer interest and adoption,” said Mitchell Klein, executive director of the Z-Wave Alliance.