( Note: Article section reprinted from ulinkmedia)
A recent article on Iot spending in Europe mentioned that the main area of IOT investment is in the consumer sector, especially in the area of smart home automation solutions.
The difficulty in assessing the state of the iot market is that it covers many types of iot use cases, applications, industries, market segments, and so on. Industrial iot, enterprise iot, consumer iot and vertical iot are all very different.
In the past, most iot spending has been in discrete manufacturing, process manufacturing, transportation, utilities, etc. Now, spending in the consumer sector is also picking up.
As a result, the relative importance of predicted and anticipated consumer segments, primarily smart home automation, is growing.
The growth in the consumption sector is not caused by the pandemic or the fact that we are spending more time at home. But on the other hand, we do spend more time at home because of the pandemic, which also affects the growth and type of investment in smart home automation.
The growth of the smart home market is not limited to Europe, of course. In fact, North America still leads in smart home market penetration. In addition, growth is expected to continue to be strong globally in the years following the pandemic. At the same time, the market is evolving in terms of suppliers, solutions and purchasing patterns.
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Number of smart homes in Europe and North America in 2021 and beyond
Home automation system shipments and service fee revenues in Europe and North America will grow at a cagR of 18.0% from $57.6 billion in 2020 to $111.6 billion in 2024.
Despite the impact of the pandemic, the iot market performed well in 2020. 2021, and especially the years that follow, looks pretty good outside Europe, too.
Over the past few years, spending in the consumer Internet of Things, traditionally seen as a niche for smart home automation, has gradually outpaced spending in other areas.
In early 2021, Berg Insight, an independent industry analyst and consulting firm, announced that the number of smart homes in Europe and North America will total 102.6 million by 2020.
As mentioned earlier, North America is leading the way. By the end of 2020, the installation base of smart home was 51.2 million units, with a penetration rate of nearly 35.6%. By 2024, Berg Insight estimates there will be nearly 78 million smart homes in North America, or about 53 percent of all households in the region.
In terms of market penetration, The European market still lags behind North America. By the end of 2020, there will be 51.4 million smart homes in Europe. The installed base in the region is expected to exceed 100 million units by the end of 2024, with a market penetration rate of 42%.
So far, the COVID-19 pandemic has had little impact on the smart home market in these two regions. While sales at bricks-and-mortar stores fell, online sales surged. Many people are spending more time at home during the pandemic and are therefore interested in improving smart home products.
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Differences between preferred smart home solutions and suppliers in North America and Europe
Smart home industry players are increasingly focusing on the software side of solutions to develop compelling use cases. Ease of installation, integration with other iot devices, and security will continue to be consumer concerns.
At the smart home product level (note that there is a difference between having some smart products and having a truly smart home), interactive home security systems have become a common type of smart home system in North America. The biggest home security providers include ADT, Vivint and Comcast, according to Berg Insight.
In Europe, traditional home automation systems and DIY solutions are more common as whole home systems. This is good news for European home automation integrators, electricians or specialists with expertise in home automation, and a variety of companies offering such capabilities, including Suntech, Centrica, Deutsche Telekom, EQ-3 and other overall home system providers in the region.
“While connectivity is beginning to become a standard feature in some home product categories, there is still a long way to go before all products in the home are connected and able to communicate with each other,” said Martin Buckman, senior analyst at Berg Insight.
While there are differences in smart home (product or system) buying patterns between Europe and North America, the supplier market is diverse everywhere. Which partner is best depends on whether the buyer uses a DIY approach, home automation systems, security systems, etc.
We often see consumers opting for DIY solutions from large vendors first, and they need the help of expert integrators if they want to have more advanced products in their smart home portfolio. All in all, the smart home market still has a lot of growth potential.
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Opportunities for smart home solution specialists and suppliers in North America and Europe
Per Berg Insight believes that products and systems related to safety and energy management have been the most successful to date because they provide clear value to consumers.To understand them, as well as the development of smart homes in Europe and North America, it is important to point out differences in connectivity, desire and standards. In Europe, for example, KNX is an important standard for home automation and building automation.
There are some ecosystems to understand. Schneider Electric, for example, has earned home automation certification for EcoXpert partners in its Wiser line, but is also part of a connected ecosystem that includes Somfy, Danfoss and others.
Beyond that, it’s important to note that these companies’ home automation offerings also overlap with building automation solutions and are often part of offerings beyond the smart home as everything becomes more connected. As we move to a hybrid work model, it will be particularly interesting to see how smart offices and smart homes connect and overlap if people want smart solutions that work from home, in the office and anywhere.
Post time: Dec-01-2021