An increasing number of organisations are jockeying for position within smart building ecosystem. Wireless communication standards such as Wi-Fi Direct, Zigbee, Z-Wave, and KNX are all eager to make their mark. There is an increasing number of open communications protocols such as ASHRAE BACnet I/P, OPC DA, Modbus TCP, oBIX, XML, SOAP and SNMP. The list of OEMs, vendors and integrators is also growing rapidly. Some of the most significant players include Crestron Electronics, Inc., ADT Corporation, AMX LLC, Control4 Corporation, Lutron Electronics Company, Inc., ABB Ltd., Nortek, Inc., Vantage Controls, Schneider Electric SA, SoftAtHome,and LivingTech.
Lucid, hailing from Ohio, claims to have pioneered behavioural efficiency and occupant engagement technology in commercial buildings. In other words they were one of the first startups to attempt to develop an operating system for smart buildings. If IBM's predictions turn out to be accurate, I'm going to go out on a limb and say that whichever company wins the battle to become the Microsoft or Apple of smart buildings will be one seriously valuable company indeed!
After doing some digging around on the 'Interwebs' I found a recent market report by Transparency Market Research that estimates the Home Automation Market will be worth USD 16.4 billion by 2019, growing at a CAGR of 24.6% from 2013 to 2019.
Will the battle for the smart building become another Apple v Microsoft fight for the desktop type scenario or will there be no need for an industry standard and plenty of room for niche operators? It will be fascinating to see how this one plays out.
My prediction is that there will continue to be a growing number of standards vying for market share but the current period of rapid growth and innovation will be followed by a period of consolidation. In the end we will see the emergence of a few dominant players. We've all seen this movie before in other industries, not only the person computer market. I'm, therefore, probably not the only one to predict that most owners and/or operators of property portfolios will want to use the same software and hardware throughout every building. This is because they will want to be able to view everything from a single uniform control panel aka dashboard and compare like-for-like data across every building. The need for standardisation will be particularly important for the public sector when 'smart cities' become a reality.
Furthermore operators will also want to benefit from economies of scale when it comes to bulk purchasing of hardware, installation, repair and maintenance. Don't forget each building may eventually contain hundreds or maybe even thousands of connected devices and sensors. Take the HVAC. It is an incredibly complicated system responsible for cooling, heating and ventilation. It consumes the majority of a building's energy and could be life-threatening if there is a fault which causes fire, toxic fumes or contamination (remember the Legionnaires' disease outbreak in the UK that caused several fatalities). I'm guessing operators won't want the hassle of interacting with a large number of different vendors if the HVAC or any other aspect of their BAS malfunctions. Instead they will want to deal with a standard operating system that can be maintained by engineers and technicians who are familiar with a widely adopted OS so that issues can be fixed quickly when things go wrong.
The other compelling case for fewer operating systems and hardware vendors is the human factor. In future, due to the consumerisation of the enterprise, software will become increasingly user-friendly so you won't need to be a rocket scientist to operate smart building software.The people charged with the responsibility of monitoring and managing smart buildings will, therefore, demand simplicity and standardisation. They are the people who work for commercial facilities management (FM) organisations and they are the ones who will be major influencers with regards to which vendors are chosen and therefore which gain market adoption. Clearly the big boys like IBM, CISCO, Siemens, Schneider Electric, and Accenture are already all over this but there are many other nimble startups like Lucid that could win through to become the 'Microsoft' of smart buildings.
The other alternative is that proprietary vendors will struggle to compete against open standards and the ultimate winner will become a 'Linux' for smart buildings. This option may be favoured by the FM industry because in this scenario they will be less likely to get 'locked in' by a single dominant commercial vendor. It is way too early to tell if the standard smart building OS with be open or proprietary so we'll just have to sit back and watch as the battle unfolds.
Another consideration is data ownership. We've already covered the growing controversy surrounding exploitation of personal data generated by wearable devices (see "Who's data is it anyway?") but what about the data generated by smart buildings? Well, as usual, it will depend on the small print. Lucid states that "you own your data. Period. Vendors should not monetize or toll your data". So they've really thrown down the gauntlet on that one!
The final major consideration is security. The ramifications for a building or buildings getting hacked is unsettling to say the least. No matter how user-friendly, elegant or financially attractive a system appears to be, it must be secure. If it cannot be trusted by the FM industry all bets are off. At the end of the day the stakes are high and you know what they say "No One Ever Got Fired for Buying IBM"!
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