Driven by growing smart security adoption, the home automation market is forecast to grow from US$12 billion in 2018 to over US$45 billion by 2023, representing a growth of over 260 percent, according to a new study by Juniper Research.
Smart security is a main driving force, as manufacturers like Nest, Hive and Netgear roll out compelling mass market products. Big players have also invested in developing smart entry solution, as evidenced by Amazon’s acquisition of Ring.
Another factor driving the growth is the ease of use realized through interoperability of ecosystems. Device interoperability also contributes to consumer convenience.
“Major vendors are concentrating on building out their ecosystems, with corporate partnerships and acquisitions being primary tools,” Juniper said. Open ecosystems will accelerate growth, resulting in the availability of one billion automation and monitoring devices by 2023, up from 176 million in 2018.
“The smart home makes the biggest impact upon customers when it is seamless. By offering services across ecosystems, vendors are broadening their markets, allowing vendors to compete on features rather than compatibility,” said research author Nick Maynard.
Meanwhile, the increasing ubiquity and low-entry cost of open platforms such as Alexa are leaving players with closed ecosystems, such as Apple, exposed, Jupiter Research observes.
Smart Technologies Boost Insurance Opportunity
The research also found that smart home represents a good opportunity for insurers to boost their appeal. In 2018, around 65 million new home insurance policies will leverage smart home technologies, Juniper predicted.
By implementing technologies such as water leak detectors and smart smoke alarms, insurers can add greater value to existing relationships and generate loyalty. This is critically important as price comparison websites have devalued the existing insurer-customer relationships, Juniper said.
Juniper Research provides research and analytical services to the global hi-tech communications sector; providing consultancy, analyst reports and industry commentary.