Smart Homes and Home Automation – 8th Edition
Smart Homes and Home Automation is the eighth consecutivereport from Berg Insight analysing the latest developments on theconnected home markets in Europe and North America.
This report in the IoT Research Series provides you with 310pages of unique business intelligence including 5-year industryforecasts and expert commentary on which to base yourbusiness decisions.
Highlights from the eighth edition of the report:
Insights from 30 executive interviews with market leadingcompanies.
360-degree overview of the smart homes & home automationecosystem.
Summary of industry trends in key vertical market segments.
Statistical data on adoption of smart home systems in Europe andNorth America.
New market forecasts lasting until 2024.
Detailed reviews of the latest initiatives launched by industryplayers.
Updated profiles of the key vendors on this market.
This report answers the following questions:
Which are the main verticals within smart homes and homeautomation?
What are the main drivers behind growth in Europe and NorthAmerica?
What are the challenges and roadblocks towards widespreadadoption?
What are the business models and channels-to-market for smarthome solutions?
Which are the leading whole-home system vendors in Europeand North America?
How are product OEMs and whole home solution vendorspositioning themselves?
What home connectivity technologies are smart home systemvendors betting on?
What is the potential market size for cellular IoT in homeautomation?
How will the smart home market evolve in the next five years?
Smart home and home automation systems include a wide range of solutions for controlling,monitoring and automating functions in the home. Berg Insight’s definition of a smart homesystem is one that is accessible from remote and includes a smartphone app or a web portaluser interface. Devices that only can be controlled and automated locally, through switches,timers, sensors and remote controls, are thus not included in the scope of this study. Smarthome systems can be grouped into seven primary categories: security and access controlsystems; energy management and climate control systems; audio-visual and entertainmentsystems; lighting and window control systems; healthcare and independent living systems;home appliances and service robotics.
The North American smart home market recorded strong growth during 2019. The installedbase of smart home systems increased by 28.5 percent to reach 172.6 million at the yearend. An estimated 19.1 million of these were multifunction or whole-home systems whereas153.5 million were point solutions designed for one specific function. As some homes havemore than one smart system in use, the installed base totalled an estimated 43.1 millionsmart homes at the end of the year. This corresponds to 30.2 percent of all households,placing North America as the most advanced smart home market in the world. Between 2019and 2024, the number of households that adopt smart home systems is forecasted to grow ata compound annual growth rate (CAGR) of 12.5 percent, resulting in 77.9 million smarthomes. The market value reached US$ 27.0 billion (€_24.1 billion) in 2019, an increase of20.5 percent year-on-year. The market value is expected to grow at a CAGR of 14.1 percentbetween 2019 and 2024, reaching US$ 52.3 billion (€ 46.7 billion) in yearly revenues at theend of the forecast period.
The European market for smart home systems is still a few years behind North America, bothin terms of market penetration and maturity. At the end of 2019, there was a total of 111.9million smart home systems in use in the EU28+2 countries, up from 83.9 million in theprevious year. Around 10.8 million of these systems were multifunction or whole-home systems whereas 101.1 million were point solutions. This corresponds to around 40.3 millionsmart homes when overlaps are taken into account, meaning that 17.4 percent of allhouseholds in Europe were smart at the end of the year. The number of Europeanhouseholds to adopt smart home systems is forecasted to grow at a compound annualgrowth rate (CAGR) of 20.2 percent during the next five years, resulting in 101.1 million smarthomes by 2024. The market value grew by 28.7 percent to € 16.6 billion (US$ 18.5 billion) in2019. The market value is forecasted to grow at a CAGR of 24.3 percent between 2019 and2024 to reach € 49.0 billion (US$ 54.9 billion) at the end of the forecast period.
A point solution will in many cases constitute the consumer’s first smart home purchase.Compared to whole-home systems, point solutions generated 62 percent of the combinedmarket revenues in North America and Europe. The most popular point solutions to date, interms of sold units, include smart thermostats, smart light bulbs, smart plugs, connectedsecurity cameras and voice controlled smart speakers. These products are marketed byincumbent OEMs such as Signify, Resideo, Danfoss, Belkin, Chamberlain, Kwikset and AssaAbloy and newer entrants such as Ecobee, Sonos, Arlo, Netatmo, IKEA and Wyze Labs. Inthe whole-home system market, traditional home automation vendors such as CrestronElectronics, Control4, Savant Systems, eQ-3 and Loxone are facing new competition ascompanies from adjacent industries have entered the market. Communications and securityservice providers such as ADT, Vivint, Comcast and Brinks Home Security (Monitronics) haveestablished themselves among the largest whole-home solution vendors in North America.Major vendors in Europe include Centrica, Somfy, Deutsche Telekom and Verisure.
The Covid-19 pandemic has so far had a very limited negative effect on the smart homemarket in North America and Europe. While sales in brick-and-mortar stores declined, onlinesales instead surged. Many people spent more time at home during the pandemic and thusbecame interested in home improvement activities such as adding smart homes devices.Berg Insight expects that working from home will become increasingly common in the future,even as Covid-19 related lockdowns and restrictions are eased. Smart home products thatmake people feel safer at home as well as enable time-savings and convenience are likely tobe popular among the many people that spend an increasing share of their time at home.
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