The threat of the ‘DIY smart home’
As you are most likely experiencing, the demand for smart home products is higher than ever. But how is this rise impacting integrators? Amy Wallington investigates.
Smart home products are more accessible than ever, with consumers able to buy devices almost anywhere. Products such as smart speakers, heating controls, smart lighting, smart doorbells, and voice assistants are among the most popular consumer devices bought for the home.
This idea of a ‘DIY smart home’ is increasing in popularity with consumers who want to create their own ‘smart home’ for a much cheaper price. But is this impacting on an integrator’s job? It is true that the high-end market will always exist and there is certainly a big place for custom install there. But is there a risk that people can get similar, if not the same, performance and control from an off-the-shelf smart home device, therefore affecting the custom install market?
Davy Currie is the managing director at Infracore HTC Ltd and recognises the surge in the DIY smart home market. He says: “The whole idea of the smart home is becoming so much more accessible now. The space that was dominated by the specialist manufacturers and suppliers has been swallowed up by the likes of Curry’s PC World, Argos, Apple Store, Amazon, etc. This technology is so readily available that inevitably, it’s going to have quite a big impact on how we do business in this sector.”
However, he thinks the high-end market will always drive custom install: “The whole smart, integrated home and custom install market has very much been for people who have money. Whereas over the past few years, it’s become a lot more accessible and it’s not about that anymore. I think the high-end is the high-end, it will always exist and that will be where custom install remains. But I think it’s more the mid-market that is going to take a hit with all the products that are coming out and all the options now available. It’s becoming a lot more of a consumer type space where before it was quite specialised.”
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Dan Eades, the director of Environ thinks that the DIY and custom installation markets are separate and thus should not have too big an impact on the custom install market. He explains: “Looking back, what we were charging a relatively large amount of money for can now be done for just a few thousand pounds, using a Smart TV, a Sonos Play Bar, the Wi-Fi router and an iPad. There are devices that will do certain functions within the home, like video entry, CCTV, trigger alarms, fire alarms, etc, that are off-the-shelf items, which are essentially a lot less expensive. Obviously, that will have an impact on the integration world.”
Eades continues: “But I would say, custom installation can be a little bit of a higher end experience these days, and there will always be people in the low-end market who need advice, but it just takes away a few customers who can do it themselves.”
On the contrary, the rise in plug-and-play smart home technology could bring integrators more work. It could give consumers a taste of what they could have at a larger scale or introduce them to new possibilities in the home that would require custom installation.
Laura Crombie, presenter of the Real Homes Show, an online TV show for home improvers says: “I don’t think off-the-shelf devices are having a negative effect on installers. In fact, my experience has been that homeowners purchase an Amazon Echo or Google Home and then call in professional installers when they want to take better advantage of Alexa or Google Assistant and expand the system to include lighting, security or smart kitchen appliances, for instance.
“We’ve seen a huge rise in companies offering smart home installations in recent years, and these firms wouldn’t be able to survive without demand. I think knowledge is power – many homeowners are still confused about which products can be connected to one another, for instance, meaning the human element, the installers, remains invaluable.”
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Interoperability is often an issue throughout the entire home automation market. Many consumers find that their off-the-shelf devices do not always work with other technology in their homes which can be frustrating and sometimes more of a burden than a help. Manufacturers are realising this issue and starting to think of ways to make their devices work together in the home by forming partnerships for instance. Sonos’ recent partnership with Google Home is an example of this, giving end users a choice of whether they control their audio through Google Assistant or Alexa.
According to the report “Race to Control the Smart Home Ecosystem”, purchase intentions for smart home products have risen from 35 per cent in 2016 to 43 per cent at the end of 2018. Many experts link the increasing demand to the rise of voice control and interoperability in the smart home market.
In order to ensure interoperability with products from other manufacturers, more and more companies are beginning to turn to open standards such as ULE. Panasonic, Orange, Deutsche Telkom and Gigaset are just a few examples of companies that have joined the ULE Alliance in recent years. The certification programme of the not-for-profit organisations ensures interoperability of ULE-based devices from different manufacturers. Over the last few years, a wide range of ULE smart home products have been launched, allowing users to extend their smart homes based on their individual needs.
Chris O’Dell, a research associate at Parks Associates adds: “The smart home ecosystem is crowded with many leading devices, including smart thermostats, networked cameras, smart video doorbells, smart door locks, and smart light bulbs. As interoperability continues to increase in importance, companies that are vertically aligned or have the right ‘works with’ partnerships will have an advantage among likely buyers.”
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Eades agrees that interoperability is key to prevent customers being put off when devices do not work together. He argues: “I think some people are put off by it because they have had a bad experience. They can’t get their thermostat to talk to their phone properly, they’ve not upgraded their firmware, some products are unreliable, some are released too early and the firmware isn’t the right version and it’s frustrating for people to use. There are probably more people encouraged to have it in their home than are put off, bit certainly, not everyone who uses it has a good experience.”
Something consumers often don’t get with an off-the-shelf product is maintenance support, something that an integrator often does offer. As Eades points out, installers can benefit from offering this in their installations: “With an off-the-shelf system, you have to maintain it yourself and obviously a large part of the custom install world is maintenance contracts and making sure the system is well maintained.
“Technology always needs maintaining – equipment should be made sure it is dust free, functioning correctly and an integrator’s job is to make sure the client is happy with everything. Things often need tweaking and firmware requires updating and upgrading where necessary. It’s a managed process rather than leaving it to the client themselves.”
The rising interest in smart homes calls for considerations to be made regarding new build houses. Should developers be offering optional extras in the form of smart lighting, smart appliances, control systems, etc? Crombie thinks so: “New build homes will undoubtedly start to have basic smart tech installed, although this is likely to be an optional extra for the foreseeable future. As connected homes become part of our psyche over the next decade, the technology will gradually be incorporated as standard as we have seen with energy efficient buildings.”
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She claims: “Integrated kitchen appliances, basic security systems with cameras and video doorbells, smart lighting and audio, will be the first to be introduced. The bonus for home buyers is that, as well as the standard NHBC new build warranty (or equivalent), these smart appliances will come with additional warranties, providing reassurance should something go wrong. Developers would be wise to partner with tech companies to provide initial free access to software as an incentive for new buyers.”
Currie has recently been involved in a 50-unit multi-dwelling installation using IoT devices. He has experienced a number of developers wanting to use off-the-shelf products rather than a custom install solution to save money.
He states: “Historically, the client I was working with has always gone down the road of using market leading home and lighting control systems. But this time, he didn’t want to spend the money but still wanted to say that the apartments are smart and maintain that feeling of investment in the technology. We used an IFTTT approach using IoT off-the-shelf products and pieced it together and it works brilliantly, he spent a quarter of what he would have previously to achieve a similar level of functionality.”
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Currie continues: “I can see a whole change of approach in the business we do. Developers don’t want to know about the latest home automation platform offerings anymore, they’re talking about Alexa and other consumer products, the types of devices we can go out at the weekend and buy off-the-shelf. But they want it cleverly put together, and I can see integrators having to go down this road of becoming app integrators instead of custom installers.”
As the market changes, integrators should be evaluating their business models to follow the latest trends. It is advised to open up to the idea of plug-and-play devices being used in the home or alongside a whole home install. Research is also crucial into what devices are compatible with other devices to ensure a better end user experience.
However, the high-end market will always exist, and it is possible that in the near future we will see custom install only existing in that market.