July 14, 2017 by Canadian Underwriter
North America is the world’s most advanced smart home market, with an installed base of 21.8 million smart homes at the end of 2016 – a 47% year-on-year growth, according to machine-to-machine (M2M) and Internet of Things (IoT) analyst firm Berg Insight.
“The strong market growth is expected to last for years to come, driving the number of smart homes in North America to 73.0 million by 2021, which corresponds to 55 per cent of all households,” Gothenburg, Sweden-based Berg Insight said in a press release on Thursday.
Unlike other areas of development, the European market is still a few years behind North America in terms of penetration and market maturity. At the end of the year, there were 8.5 million smart homes in Europe and the market is forecasted to grow at a compound annual growth rate of 57% in the next five years to reach 80.6 million smart homes by 2021, which corresponds to 36% of all European households, the firm reported.
The most successful products on the smart home market include smart thermostats, security systems, smart light bulbs, network cameras and multi-room audio systems from vendors. Major vendors of comprehensive whole-home smart home systems include a mix of energy-, security- and communication service providers and home automation specialists.
“2017 is anticipated to be a good year for smart home technology as entry-level smart home systems have become affordable for the mass market, at the same time as the reliability and features have improved significantly,” Anders Frick, senior analyst at Berg Insight, said in the release.
New innovative user interfaces are also important as a catalyst for market growth. Several information and communications technology “industry giants are now betting on voice driven user interfaces to make it easier to control smart home solutions,” Frick reported.
For example, the Alexa service from Amazon has quickly become very popular through its Echo products and Google is pushing its digital assistant through Google Home. “Furthermore, Apple with its HomeKit platform and the HomePod smart speaker, as well as Microsoft with its Cortana service and the Invoke speaker are ready to challenge Amazon and Google when the devices are being launched later in 2017,” Frick said.
Berg Insight anticipates that the popularity of voice enabled speakers will continue to increase and that smart speakers will be one of the most significant user interfaces in the home environment. “Amazon is still the leading player but Google’s and Apple’s ecosystems are stronger, at least outside North America,” Frick said.
Berg Insight has conducted market research into all major M2M/IoT verticals, including fleet management, car telematics, smart metering, smart homes, mobile health and industrial M2M since 2004. The company offers numerous market reports, detailed market forecast databases and advisory services. It has provided analytical services to 850 clients in 70 countries on six continents. Customers range from many of the world’s largest mobile operators, IT companies and telecom vendors, to venture capitalists, technology start-ups and specialist consultants.