Global Smart Home Market: Snapshot
The global smart home market is poised to surge exponentially in the coming years. Besides the rising disposable income of consumers, the market will highly benefit from the increasing internet penetration worldwide. Furthermore, the recent advancements in the Internet of Things (IoT) that resulted in price drops of processors and sensors will encourage manufacturers to promote automation in the household sector. In the last few years, the world witnessed extensive rise in Wi-Fi access facilitated by growth in IoT services. As these devices operate through wireless connectivity, the smart home market will be considerably facilitated by the introduction of high-speed internet. Moreover, the proliferation of Wi-Fi connectivity in the household sector, will aid in the expansion of the global smart home market.
Besides these, the demand for smart home appliances will gain pace, as consumers realize the importance as well as benefits of installing energy-efficient products at home. For instance, consumers can decrease usage of energy by means of temperature settings and by scheduling programmable thermostats. Smart thermostats that are linked to home Wi-Fi networks comes with easy to use applications and can be controlled remotely. Despite these advantages, the continuing threat of security breaches on cloud is a key challenge for the market.
The global market for Smart Homes stood at US$ 30.02bn in 2016. Rising at a healthy CAGR of 14.6% from 2017 to 2025, the opportunity in this market is likely to touch US$ 97.61 bn by the end of 2025.
North America to Continue Leading Global Smart Home Market
Regionally, the global smart home market can be classified into North America, Asia Pacific, Europe, the Middle East and Africa, and Latin America. Among these regions, North America has emerged as the leading regional market for smart homes, accounting for a share of 38.7% in the overall market in 2016. Europe also exhibits lucrative opportunities for enterprises operating in the smart home market. These regions demonstrate a greater demand for smart home appliances, compared to other regions and continue being at the market’s fore through the forecast period. In North America, the smart home market is also benefiting from the rising demand for home healthcare.
In Europe countries such as the U.K, Germany, France, and Italy have emerged as the most lucrative pockets for the sale of smart home appliances. The presence of large number of industries and rising need for reducing energy consumption are augmenting the demand of smart home appliances in Europe.
Asia Pacific, however, is expected to project a higher growth rate than other regions between 2016 and 2025. Urbanization witnessed across major economies such as India, Japan, and China will aid the expansion of the smart home market in Asia Pacific. Changing lifestyles, need for energy efficient devices, mobility and comfort are the factors bolstering the demand of smart home market in Asia Pacific.
HVAC Control Segment to Project Higher Demand
The global smart home market based on application is segmented into lighting control, security and access control, HVAC control, entertainment control, and others. Among these segments, HVAC control accounted for the highest share of27.2% in the market in 2016. Need for energy efficient devices and the rising demand for optimizing the use of energy are the factors fuelling the demand of HVAC control systems in the global smart home market during the forecast period.
Some of the key players in the global smart home market includes Honeywell International Inc., Siemens AG, Schneider Electric SE, ABB Ltd., Johnson Controls Inc., Emerson Electric Company, Samsung Electronics Co., Ltd., LG Electronics Inc., United Technologies Corporation and Crestron Electronics, Inc. among others.
Global Smart Home Market: Overview
Smart homes are the residences that are equipped with information and computing technology devices that anticipates and responds to the requirement of the owner in an effective and efficient manner. Smart homes involves automation and control of Heating, Ventilation, Air Conditioning and Security system (HVAC), lighting and home appliances like refrigerators, ovens and dryers. The smart home devices use Wi-Fi for monitoring remotely and are a part of Internet of Things (IoTs). Modern systems comprises sensors and switches connected to a central hub sometimes known as gateway from which systems are controlled with a user interface that is interrelated with a mobile phone software, web interface, or a wall mounted terminal. Further, smart homes use fingerprint identification or key cards in place of conventional locks, making the homes more secure. Smart homes market is fragmented market with various medium and small companies present in the market. Moreover, there are very few worldwide accepted industry standards in this market. Widespread communications protocol for products embraces Ethernet, X10, 6LoWPAN, RS-485, ZigBee Bluetooth LE (BLE) and Z-Wave, or other proprietary protocols that are incompatible with each other.
Global Smart Home Market: Trends and Opportunities
Increasing mobility is one of the emerging trends in the global smart home market during the forecast period. In the modern era, mobility is one of the important factors that allow people to be connected with their devices at home. Since all the devices are connected to a smart phone or tablet, no matter which corner of the house a person may be, can control everything via their smartphones thus, enhancing the mobility.
Increasing consumer acceptance is an important factor bolstering the demand of smart homes in the global market. Customers have identified the security, value and energy-efficient solutions offered by smart homes. The ease of monitoring, managing and controlling devices and home appliances at any time, from any place are boosting the customers’ acceptance of smart homes. The advent of the Internet of Things (IoT), technologies such as wearable’s, near field communications, Wi-Fi, smartphones, Bluetooth and ZigBee protocols, have additionally amplified the demand for smart home solutions.
Advancement in Internet of Things is also one of the major factors driving the smart home market worldwide. Increasing drops in the price of processors and sensors and higher networking capabilities alongside extensive Wi-Fi access have allowed extensive growth of Internet of Things. All the devices used in smart homes are now operates through internet of things. Since the IoTs excels a simple tech market and is likely to be applied in every field, thereby, allowing huge improvement of productivity and quality.
However, issues pertaining to privacy and security breach are restraining the growth of the smart home market during the forecast period. With the increasing demand of smart home devices, security and privacy breach is also increasing. Since the devices are connected to Internet of Things, there are chances that these devices likely be hacked or breached and exploited. Network security vulnerabilities from these devices is a major concern for the consumers or users. Another major issue with the smart home devices is the default passwords that the consumers use. Majority of the population does not change the default passwords of their devices that are easily hacked.
In addition, majority of the IoT devices are not deliberated with strict protection ability, therefore, they are vulnerable to attack.
Global Smart Home Market: Segmentation
The global Smart Home market is segmented on the basis of application and geography. Based on application, the smart home market is bifurcated into lighting control, security and access control, HVAC control, entertainment control and others. The HVAC control segment accounted for the highest market revenue share in 2016 and is expected to remain the same during the forecast period. Need for energy efficient devices and concern for optimizing the use of energy are the factors bolstering the demand of HVAC control system in the global smart home market during the forecast period.
By geography, the global Smart Home market has been bifurcated into five regions that include North America, Europe, Asia Pacific, Middle East and Africa, and Latin America. In 2016, the North America smart home market accounted for the highest market revenue share followed by Europe and Asia Pacific. Increasing demand of home healthcare is boosting the demand of smart home market in North America.
Companies Mentioned in the Report
Some of the key players in the global smart home market include Honeywell International Inc., Siemens AG, Schneider Electric SE, ABB Ltd., Johnson Controls Inc., Emerson Electric Company, Samsung Electronics Co., Ltd., LG Electronics Inc., United Technologies Corporation and Crestron Electronics, Inc. among others.
The segments covered in the global Smart Home market are as follows:
- Lighting Control
- Security and Access Control
- HVAC Control
- Entertainment Control
- North America
- Rest of North America
- Rest of Europe
- Asia Pacific
- Rest of Asia Pacific
- Middle East and Africa
- South Africa
- Rest of MEA
- Latin America
- Rest of Latin America