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What Will Make Home Automation Mainstream?
Price, installation and competitive advantages needed to trickle home automation down.
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07.02.2008 — Mass-market home automation is a lot like the weather: lots of people talk about it, but no one's ever come up with a working plan for doing anything about it.

So, are we ever going to see automation really trickle down to a mainstream consumer level?

After all, just because it hasn't doesn't mean it won't, right? Academic business school types who buy into the efficient market hypothesis argue that if something can be brought to market, it will be.

If it hasn't been, then there remain barriers, whether technological or economic, that first needs to be solved.

Price Sensitivity


The first, and most blindingly obvious issue, is that automation remains pricey. And it's not just the hardware; the expertise required to install and program it successfully doesn't come cheap.

Behind every little black box, whether relay, switch or controller in a system, lies the costs of engineering, research and development. On the installation side, there's the time and training involved in ensuring that the design and install puts all those boxes together correctly.

That doesn't even count the time and labor involved in writing the control programming that makes it all work.

Learning Curve Disadvantages


Whatever the talk about "turnkey" automation systems, it just isn't happening. Idiosyncrasies on specific jobsites mean that a "one size fits all" automation system remains impractical.

In order to avoid hours of wasted effort, jobsite testing requires expertise that only comes from extensive training and experience. Those two things stand between a homeowner and his ability pick up a system at Home Depot and finish installing it over the weekend.

Sustainable Competitive Advantages


Intimately related to the first two points is the requirement for vendors and installers to be able to offer automation systems on a large scale and do it profitably.

Part of the puzzle is to take the "custom" out of "custom installation" and standardize system design as much as possible. Some integration dealers do this on a small or medium scale, working with a builder to automate MDU buildings or detached homes.

It's not inconceivable that a process-centric integrator could take automation to the tract home level, if the price was right.

Scaling Needed to Go Mainstream


I don't want to be remembered as the guy who said that mass-market automation would never happen.

Remember the episode of The Simpsons that flashed back to Marge's computer science degree in the 1970's, and her Professor Frink who predicted that, "In 20 years, computers will be twice as big, five times faster, and be so expensive that only the five richest kings of Europe would own one"?

Exactly.

But before we can expect automation to be something that most, rather than some, homeowners have installed, sizable investments in scaling cost and ease of use need to be made.

What do you think it will take to make home automation mainstream?

Lee Distad is a freelance CEDIA Certified Professional Designer who offers design and process consultation to firms in the Custom Installation industry, as well as copy writing and other professional writing services. Lee’s business and industry blog can be read at http://www.leedistad.com

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Comments

Posted by Derek Flickinger  on  07/02  at  10:15 AM

Lee,

I am not sure we ever will see mass deployment of “automation” for the sake of automation.  However, I do see one of the strategic driving factors coming from the need to implement at least some aspects of “automation” coming from the utility industry.  The whole aspect of price-driven load response and demand side management systems assume at least some form of control over the HVAC and sometimes the water heater systems.  Some even are tapping into the potential for window shade control.  So, my feeling is that we, as integrators, might want to consider pursuing the “standards” that the local utility company is putting into place for their energy management programs in our associated market areas and potentially leveraging those technologies as part of delivering a more comprehensive “automation” system.  After all, the customer does not want to have to put in two parallel sets of control and monitoring devices.  It is a back-door approach to increasing the acceptance of “automation” systems, but rollouts of 50 to 100 thousand homes at a time is a large currently untapped market and the fact that the customer could save money by participating in their energy company’s initiatives makes the sale a lot easier.

=D-

Posted by Michel Kohanim  on  07/03  at  12:32 PM

Lee,

I agree with your points but there are solutions out there that address your points:

a. Cost sensitivity:
- Universal Devices, Inc. makes ISY-99 Series (home automation controller) the retail price of which is $299.00
- Proliferation of inexpensive and intelligent devices such as INSTEON, ZWave, UPB, and Enocean
- Average installation for full control/monitoring and remote/mobile access is about $2500.00 (using INSTEON. A little more using ZWave or UPB)

b. Expertise
- 1500 ISYs have been sold in span of a year 20% of which are DIYers

Michel

Posted by billsvision  on  07/03  at  05:22 PM

Home Automation has never been among the living. All this talk and money simply can’t keep up with the changing issues that affect consumers. With the price of energy sky-rocketing and little if any help from HA, it’s time to ditch something nobody really wants anyway. Control4 and all the rest may think they can sell this stuff to consumers but consider what’s happening with CableTV now. Thousands of consumers are choosing to take back their receivers and cancel their subscriptions. Consumers are already doing what they can to save on the household budget...not add some extraneous convenience items. Yes, HA will come back, again, but next time it will be transparent to consumers (don’t program it, learn what I need) and easy to understand. Oh and it won’t be called “Automation”. No one likes to have their life automated. At least none of us humans…

Posted by DistinctAV  on  07/03  at  08:50 PM

I’ve found that the biggest barrier is that every product manufacturer builds proprietary systems that only deliver 70% of their promises to be the “ultimate home automation solution”.  No manufacturer can be the final solution because the complexity of programming a truly Smart home system makes it too difficult for a generic, mass-market solution.

The good news is, custom integrators like us fill that void.  For the uninformed masses (not uneducated, simply uninformed), they will continue to buy what is pushed down their throats.

http://www.completeautomatedhome.com

Posted by Cheryl Kerr  on  07/04  at  06:27 PM

Michel Kohanim has it right. There are plenty of options available at prices nearly any homeowner could afford.  And many home automation products have wireless options, which means apartment dwellers and other renters can take systems along when they move.

If the goal is to make integrated whole home systems mainstream, we’re going about it the wrong way.  We can’t believe the objections we receive from laypeople who say the technology is too expensive, too complicated or too anything. 

The truth is that technology is currently available at every price point, and expertise is readily available to meet the demand as it grows.

It’s critical that we unify our message and spread the news: home automation is in fact available to the average person, today!  I’m talking about everyone from the neighbor you borrow sugar from, the old high school friend you meet for drinks, your barber and the grocery store check out lady. 

How on earth will home automation become mainstream if we in the industry run around perpetuating the false belief that our technology is unattainable to the “mainstream?”

Here’s a quick example.  What happens when you tell people what you do for a living?  In my case, I say I’m a marketing consultant for the home automation industry.  The two most frequent responses are:

1.  What’s home automation?
2.  Wow, isn’t that stuff expensive? 

Sound familiar?  Commonly, the response to “What’s home automation?” is technical & causes eyes to glaze over.  When asked “Is it expensive?” we say “Yes, it is.” Clearly we’re working against ourselves here. 

How about we work together to excite the masses and empower them to dream about home automation.  Let’s tell everyone who asks that residential technology is fully within their reach.  Even if your business only targets high-end homeowners, help the industry become mainsteam by changing your answer to “isn’t that expensive?”

I like, “You can spend as much or as little as you like…home automation is available for every income bracket and lifestyle.”

The standard design and scalability factors can similarly be addressed.  A great example of a flexible , pre-engineered design is available for download at http://www.homecontrols.com/homecontrols/pdf/psd_0508.pdf .  Using cost effective technology, this design is laid out system-by-system using only products that fully integrate with each other.  Maybe a single manufacturer isn’t covering all our basis, but a single distributor is.

Here’s an idea to make home automation even more affordable for your friends, or for your clients.  Suggest that they buy a single system from you, like distributed audio, and then add additional systems as they can. 

I know this sounds scary, but it’s really simple if you’re using a fully integrated design (like the one mentioned above), because all the products and systems work together.  It’s all there in the design…fool proof.

Posted by marc fleury  on  07/07  at  11:35 PM

Lack of open standards and free/open software is a biggy. 

A bunch of us are getting together at http://www.openremote.org and try to do something about it.  We are early so sorry for the plug.

Open community, low price (free), standards, open software. It is worth a shot, off the shelf hardware and software are here we might as well use them.

I agree with a comment that the word “automation” isn’t optimal but it seems to have the most recognition, no? 

I don’t think this is an industry that is hopelessly “not for the masses” it is just that typing HEX codes in a RS controller isn’t for your average person, all of this needs to be “automated”

Posted by Ted Bowland  on  07/08  at  08:36 PM

Academic Business idea: “if something can be brought to market it will be.”
The keys words here are CAN and SOMETHING.
The statement is correct the, be all do all Home Automation systems can and have been brought to market. Brought to you by the current incarnation of the HA industry.
That market is high end expensive. Just as new markets tend to go.
This is not what the mainstream market wants - the whole shebang, large, expensive systems that most HA designer/installers sell.

There is a lot, well maybe a bit of frustration in the industry that the industry isn’t growing as most do. With maturity of a market, product gets better, focus in on the consumers demands, they’re easier to obtain and they get much cheaper and the cycle to maturity is underway.

So the whole Shebang type systems, all the bells and whistles, we can automate anything is the SOMETHING.
What the mainstream is going to want – the SOMETHING - is far… far…. from that. Take a look at what is being offered by those system designers that get their foot in the door of large gated communities, condo developments and track houses. They are getting ever so slightly closer to mainstream then any others and they are selling vary simple, easy to use, do a few things well systems.

So the real question here, to me, is CAN. Can the HA guys give the market what they want.
Those in the industry, I think would send out a resounding yes. So why aren’t they.

Most in the industry are nerds incognito from the Audio File world slowly being replaced by straight up nerds (its cool now) from the computer/networking world.
It is very hard for them to give a customer only what they want. Nothing more not even a stitch more. SO they CAN’T bring to market what the customer wants –period- They can only bring to market what they can and it happens to be a small market.

There was a movement to sell to the woman of the home they are really the ones that make the decisions but it was seen as “well that’s excellent I’ll sell what I want to the person that can really get that contract signed” rather then “I’ll listen to the person who will make the decision to buy, I’ll find out what she wants, fulfill those wants completely and move on with one more happy customer under my belt.”

So if the current incarnation of the industry can figure out what the mainstream market would want. Can a system be created and brought to market.
The answer then is yes and it well.
Here is what I think that market wants:
>Directely related to price sensitivity I’ll start with scalability. Currently a person would likely have a TV in there living room and maybe some years later they may put another in the kitchen. The Kitchen also has a Sony radio that was bought and paid for (cheap) 5 years ago. There two kids over time have put CD/Radios in the rooms. After a bonus cheque from work they put a large screen and 5.1 theatre system in there basement.
Get my point that is the scalability they are used to and require from a cost standpoint. A system to meet the mainstream market is going to have to mimic that.
Also related to price sensitivity the labour and time involved in this scalability must not only be kept under control rater then seen as an opportunity to get back in the door/keep you foot in the door (sound familiar) rather it need to be almost eliminated. This means that from a software point of view it need to be wrote once, sold 100,000 times.<

I agree wholeheartedly with the statement “"turnkey" automation systems, it just isn’t happening. Idiosyncrasies on specific jobsites mean that a “one size fits all” automation system remains impractical”
We have to accept some limitations to eliminate idiosyncrasies. That problem comes from the custom HA world that is giving there customs (hopefully) what they want “the whole shebang”. I think we will find that the Mainstream markets will not even think of the limitations as limitations. I know, that is going to be very hard for the current HA business people to take but this is an entirely different market we are talking about here.

Bringing the price down > to bring the volume up > to keep the profits in line!!!
This is a risk thing. It’s not about chickens, horses or carts.
With the right knowledge, commitment and integrity the Custom HA industry has been a ride on the gravy train. What a fabulously fun and rewarding way to make money hand over fist. To create a cheap successful product for a mainstream market that doesn’t currently exist take a lot of time a lot of money and big $^%$&^%’s

When a solution with the potential to penetrate the mainstream market comes along it will very likely not be installed by the current home automation installers, designers, integrators.
It will likely be installed by the equivalent to the guy that installs your water heater, new refrigerator, stove or water purifier
i.e:  - I need a space this big with a plug available.
- They get installed like this…it should take 3-5 hrs
- -I’ll run you through the setup when I’m done it only take a few minutes.
- It’s worth getting a check-up once a year but most people don’t and some have been using this system for 10 years or more with no problem.

Ted Bowland
Oetz Systems Inc

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