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Connected Homes April 2018 Viewpoints

Technology Analyst: Michael Gold

Home Entryways and Market Entryways

Why is this topic significant?

Connected front doorways are inspiring venture-capital investments, corporate acquisitions, complex technical strategies, and multiparty business models.

Description

Amazon.com recently launched a service that deters package theft by enabling delivery personnel to enter a home having a connected door lock from Kwikset or Yale. An Amazon-branded Wi-Fi camera monitors an interior entryway, and a smartphone shows videos of a delivery. Amazon intends to integrate its system with Amazon Home Services, which connects users to repair crews, housekeepers, and dog walkers.

Amazon also recently initiated acquisition of Ring—maker of a unit that incorporates a doorbell button and an exterior-mounted camera. The start-up had enjoyed nearly $230 million in venture-capital investments, nearly half that amount during 2017. Amazon's friendly offer reportedly exceeds $1 billion.

Similar smart doorbells from many vendors notify mobile apps to begin streaming video when a visitor rings a chime, and they generally let users stream video of an exterior entryway on demand. Remote users can monitor visitors before unlocking and after relocking connected deadbolts, for example, when housekeepers need to enter and exit unoccupied homes.

Nest Labs promises that a new smart lock from Yale will yield a further benefit: When a household member unlocks a door, a security system will automatically disarm. Disarming procedures are a traditional annoyance for users of burglar alarms, who can even owe penalties for false alarms.

Implications

Players often enjoy market opportunities to allay users' frustrations, for example, packages stolen from doorsteps and burglar alarms that seem oversensitive. Like Nest, Amazon and Apple might find ways to deter false alarms. And like Amazon, Apple and Google (Nest's parent company) might partner with retailers and deliver services to reduce anxieties about stolen packages.

Walmart is currently trialing in-home delivery, apparently in response to Amazon's service introduction. Each company relies on different and incompatible brands of connected locks. A household might have only one choice of in-home delivery service, depending on its lock. Noninteroperable locks might simply stimulate new anxieties and be obstacles to market development.

People who want a connected lock might be reluctant to get one if doing so also effectively locks them into a long-term contract with Amazon, Apple, Google, or Walmart. But lock makers seem to be indispensable to connected-entryway business models. They might have the market power to relieve homeowners' "wallet lock" by insisting on harmonized standards.

Impacts/Disruptions

By allowing complete strangers into unoccupied homes through remotely unlocked doors, are users merely substituting one set of security problems for others? Surveillance cameras will likely deter most looking for mischief, though not all. A more significant risk might arise in the form of cyberattacks against smart door locks. Measures to allay cybersecurity concerns likely extended the relatively long development time (at least two and a half years) for Yale's new Nest-compatible lock. The lock implements Thread—a wireless protocol whose security measures give Google confidence to disarm alarms and turn off indoor cameras when appropriate. Other vendors of safety-critical hardware—locks, cameras, security systems, garage doors, and so on—might now have a rational road map to interoperate with connected-home hardware from Google (including Nest). Somewhat similarly, Apple requires partners to certify compatibility with HomeKit to ensure physical security and cybersecurity. Watch for Amazon to provide comparable ways for hardware partners to enable safe use of connected-home technologies.

Scale of Impact

  • Low
  • Medium
  • High
The scale of impact for this topic is: Low to Medium

Time of Impact

  • Now
  • 5 Years
  • 10 Years
  • 15 Years
The time of impact for this topic is: Now to 5 Years

Opportunities in the following industry areas:

Electronics manufacturers, retailers, package-delivery services, online-to-offline services, premises-monitoring services, lock manufacturers, locksmiths, installation and repair contractors, software developers, cloud services, cybersecurity services, standards-certification services

Relevant to the following Explorer Technology Areas:

Smart-TV-OS Shoot-Out

By Sean R. Barulich
Barulich is a senior research analyst with Strategic Business Insights.

Why is this topic significant?

Smart-TV manufacturers leverage feature-packed operating systems to compete with other manufacturers and improve the value of their products for consumers. Smart-TV OSs can provide users with access to media-streaming services, third-party applications, and games, among other things.

Description

TV manufacturers continue to add more features and functionality to their smart-TV operating systems (OSs) to distinguish their products from competitor's offerings. For example, LG and Samsung have focused on integrating smart-home-hub functionality and virtual assistants into their smart TVs. LG recently updated its webOS smart-TV OS and integrated its ThinQ artificial-intelligence (AI) platform into its 2018 organic-light-emitting-diode (OLED) and super-ultra-high-definition TVs. The platform allows users to control ThinQ-compatible smart-home products with speech by using the TV's voice remote and LG's AI technology. LG also added Google's Google Assistant virtual assistant into webOS and introduced compatibility with Amazon's Alexa virtual assistant. Samsung is also improving its Tizen smart-TV OS and introducing smart-home-device interoperability. For example, Samsung recently added its SmartThings smart-home software platform and Bixby virtual assistant to its 2018 quantum-dot-light-emitting-diode (QLED) TVs. The update enables users to control SmartThings-compatible devices—that communicate over Wi-Fi—using the TV's software interface or speech-based commands (through Bixby).

Manufacturers such as Sony and Sharp currently use the Android TV OS in their smart TVs. Android TV may have a competitive advantage over other smart-TV OSs because the software can access the Google Play Store for downloading various apps and games. In addition, Android TV allows users to search for content across various media-streaming services using universal search, and it provides access to Google Assistant for controlling the TV with speech commands. Other smart-TV platforms might introduce more competition. For example, Roku's Roku OS and Amazon's Fire TV may have opportunities in low-range to midrange TV sets. Roku's and Amazon's platforms endow budget smart TVs with some OS features that high-end TVs have.

Implications

Smart-TV manufacturers may create new opportunities by leveraging new software-based features. If manufacturers integrate streamlined smart-home-hub functionality in TV sets, users may prefer to use smart TVs for viewing smart-camera footage or controlling various connected devices. Smart-TV manufacturers may also create opportunities by introducing gaming features in TV sets. For example, Samsung provides Steam Link functionality in its TV sets, letting users stream games from their PCs and play directly on their TVs. Android-based smart TVs can also obtain similar gaming functionality through Google Play Store apps, which are supported by the growing availability of compatible third-party game controllers.

Impacts/Disruptions

Although many consumers may be more interested in the hardware specifications of TVs over software-based features (which historically have been very poorly implemented), some consumers may find value in new smart-TV features such as advanced smart-home-hub functionality, game streaming, and compatibility with Google Assistant. But because smart TVs offer such similar functionality, any one manufacturer's achieving meaningful differentiation on the basis of its smart-TV platform can be difficult. Such an effort can even backfire, as may be likely in Samsung's case: Power users have expressed a strong aversion to the Bixby virtual assistant in favor of Google's far superior alternative.

Smart TVs and home-automation devices already have a history of security problems, and savvy purchasers may reward companies that take security seriously, potentially creating a new—and societally beneficial—avenue for competition.

Scale of Impact

  • Low
  • Medium
  • High
The scale of impact for this topic is: Medium

Time of Impact

  • Now
  • 5 Years
  • 10 Years
  • 15 Years
The time of impact for this topic is: Now

Opportunities in the following industry areas:

Software development, cloud computing, artificial intelligence, electronics manufacturers

Relevant to the following Explorer Technology Areas: