Today’s consumer is increasingly connected. Credible analysts report that there are now an average of 10 connected devices per home — and there will be more than 50 by 2020. It’s not just smartphones that are connected: it’s tablets, TVs, smart locks, smart lights, Web cams, environment sensors, security systems, fitness bands, smart thermostats, robotic floor cleaners, video doorbells and more. Both Amazon and Google went on acquisition sprees, vying to buy up this technology to strengthen their own future plans to increase their presence in smart homes.
But what are those plans? Amazon and Google are competing to provide a single platform for today’s smart home that not only offers novel automated conveniences, but also ease of installation and use. It’s a market that broadband service providers — communal, regional and national — are positioned to own themselves, especially as their Internet service adds the speed of service, reliability and security assurance for these connected services.
An Open Opportunity
At least one standout broadband service provider is not standing still. Comcast is looking to turn its Xfinity into a kind of “home operating system” promising to bring smart home automation controls to hundreds of devices connected to its Xfinity broadband service.
Comcast has long invested in voice-controlled computing around its video services and is extending that investment to external “Works with Xfinity” partners to power automated smart home experiences. With a verbal “good night” command, Xfinity, for example would lock all doors, turn off lights, adjust thermostats and arm the home-security system. It’s a battle for the wallet. Who will win it?
Broadband Providers’ Existing Advantage
Broadband providers are uniquely positioned to own this market. They have that enviable direct relationship with the customer, which comes from the physical interface they have with customers — the trucks that roll to turn on the Internet service, the help desk agent who resolves their connectivity problem, the retail counter or agent who helps them with billing and upgrades. Secondly, broadband providers are inherently trusted as they are not making money off their customer’s data being sold to third parties. Additionally, it is the broadband provider’s infrastructure that gets and keeps the customer connected.
The opportunity is what the industry has called “the smart pipe,” and it’s the broadband operator’s fundamental business to own and operate. But if they sit on the sidelines in this dynamic IoT market, these broadband providers risk becoming the “dumb pipe,” relegated to a commoditized role of providing merely the transport layer of the smart home platform.
A market advantage opportunity is discovered. A 2017 Gemalto survey of 10,500 consumers evidenced that 65 percent of consumers are concerned about a hacker controlling their IoT device, and 60 percent of these are concerned about their data being leaked. Furthermore, of 1,050 businesses surveyed, only 57 percent encrypt the data they capture or store via IoT devices. Finally, on average, four of every five consumers surveyed in this study agree that the amount of data collected by IoT makes privacy and security a key challenge and need.
The call to action is here. Broadband providers can leverage the customer awareness driven in the market today to launch a variety of connected and smart services that subscribers want and will preferentially buy from the broadband provider’s trusted brand.
Smart Home Growth Explodes
Amazon has Alexa integrations with more than 4,000 devices, enhancing everything from bathroom mirrors and shower heat to car automation.
Google jumped into the voice-controlled computing market a bit later, but already boasts integration with 1,500-plus devices, and plans to lever age its Android smartphone market share to win over customers.
Amazon is not only intent on delivering groceries to the customer’s door with its purchase of Whole Foods, but it already rivals Netflix in spending on video and music content services, shelling out $4.5 billion on its content business last year, compared to Netflix’s $6 billion.
Melissa Simpler is CEO and co-founder of Affinegy, which helps carriers deliver high-speed Wi-Fi capacity to smart homes along with critical device management — auto-configuration, real-time auditing and update management — to dozens of smart hardware devices from numerous different vendors.
