Smart Home for the Holidays

Smart home devices have become a trendy holiday gift item since Amazon introduced its Echo in 2014, and with the addition of Google Assistant and Facebook Portal into the mix, among others, that momentum is expected to continue. Reduced pricing and starter smart home bundles will entice millions of dollars in consumer spending this holiday season, but these devices will also help determine the type of smart homes that will be built around them. We forecast that holiday spending will help convert 128 million additional homes into smart homes by the end of 2020, and the impact of those devices will go even further.

Using Enhanced Connectivity to Build Smart Homes

The smart home market has been through a series of evolutionary stages during the past decade, which along the way have brought new approaches to wireless connectivity and managing often-competing protocols. Across millions of homes, the connectivity embedded in voice control front end devices will determine the connectivity they will look for in devices such as door locks, lights, sensors, key fobs, and wireless security cameras as integrated smart home systems evolve.

For smart home devices and service providers investing in embedding wireless connectivity in their offerings, the continuing competing and disparate landscape for smart home protocols remains an expensive and constricting block on smart home investment and ROI. The lack of a clear standard and no operability between major smart home protocols means that each new smart home is a battleground for each connectivity protocol to gain a foothold. Each additional device also cements a foundation that will underpin the adoption of increasingly more devices looking to leverage the same connectivity protocols.

A Wireless Protocol Free-for-All

As consumer tech companies have pushed into the smart home market with smart home management platforms and voice control capabilities in smart speakers, Bluetooth connectivity has increasingly pushed into the heart of many smart homes. However, along with Wi-Fi, Z-Wave, ZigBee, Thread, and Propriety are all in competition to deliver connectivity to smart home technology—sometimes in the same device.

Voice control front-ends increasingly offer a new format for smart home gateway functionality. Amazon has embraced Zigbee for this purpose in its Echo Plus devices, and Google Nest is leveraging its own Thread protocol to communicate to sensors; both continue to rely on Bluetooth and Wi-Fi as well. There are signs that outside the United States, and particularly in Asia, Bluetooth will provide connectivity from voice control front-end devices to an array of smart home sensors around the home. The scale of the Asian market, and in particular China and its tech providers, will deliver a significant boost to the adoption and support of Bluetooth in competition with Z-Wave, Zigbee, and other low-power connectivity protocols.

Between 2020 and 2024 is when new and reengineered wireless protocols will become available to smart home vendors, leading to a shift toward increased standardization. Bluetooth and 802.15.4 will be the most popular offerings, with further adoption driven primarily by the inclusion in voice control front-end devices. 

Embedded protocol support will continue to impact the smart home market even after the gifts have been unwrapped and the decorations stored away. For millions of consumers, voice control devices are for life, not just for the holidays. 

These findings are from ABI Research’s Smart Home Connectivity application analysis report, part of our Smart Home research service, which includes research, data, and ABI Insights.