IoT Strategy

Top Trends in IoT: Video Services, Smart Home, Health & Mobile

by Stuart Sikes | Apr. 1, 2015

2015 is a year of intense experimentation in new value propositions for advanced technologies and services. Multiple sectors within the connected home are facing new competition and an increased emphasis on differentiation strategies and expanded offerings. Each area presents its own unique challenges and value propositions.

Pay TV, OTT & Streaming Media

While broadband penetration growth has slowed in mature markets, high competition is driving an industry push to ever-faster service tiers. Pay TV is experiencing a similar pattern in global growth—fast-paced adoption in emerging markets and heightened competition in developed markets.

For the past few years, non-linear video has claimed larger percentages of consumer viewing hours. The video content market is seeing a fundamental shift in how viewers watch programming, requiring a new definition of what is called “television.”

Streaming is now a feature on almost every connectable device, including smart TVs, gaming consoles, tablets, and smartphones. Pay-TV operators are evaluating entry into the OTT streaming market, which will increase the competition for viewers.

Smart Devices & Home Energy Management

Consumers are becoming more aware of smart devices that help them manage their home’s electricity usage. Highly differentiated smart products are capturing a significant slice of the overall market. For example, 42% of broadband households that are likely to purchase a smart thermostat are willing to pay a premium for a thermostat with advanced features.

Consumers view energy management services as interesting and even desirable, but when bundled together, these value-add services become attractive enough that a significant percentage of consumers are willing to pay for a package of services.

As consumers adopt more smart devices, interoperability becomes more important. Nearly two-thirds of devices purchased in 2014 were part of a home controls or security system.

Safety and security remain the leading value propositions for smart devices; however, 70% of smart device owners are concerned about unauthorized access to their home control devices as well as to the data those devices generate.

As a result of the entry of consumer technology brands into the tech support market, the industry has grown significantly over the past five years. For many brands, providing comprehensive technical support is a means of strengthening customer relationships in the face of intense competition and a rapidly evolving technology environment.

Health & Mobile Opportunities

Prospects for the global connected health industry have brightened. Strategic and tactical changes within the industry have gradually made an impact and fostered creation of new services and care models. Although each country may have a different growth path and its own set of unique challenges, all are experimenting with collaborative approaches among the government/insurers, the care providers, and technology partners.

Sixty-eight percent of mobile subscribers prefer buying a smartphone at full price and paying a lower monthly service fee and having no contract. Traditional device subsidy models to drive smartphone sales are falling apart; instead, mobile carriers need to continue to experiment with pricing models to reach a happy medium.

No matter the category, the dominant leaders emerging this year will be the companies that leverage consumer demand and expectations to provide a personalized and valuable user experience.

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Stuart Sikes

Stuart Sikes

President

Stuart Sikes is the president of Parks Associates, a market research firm specializing in consumer adoption of technology products and services. Stuart and team assist clients around the world by predicting trends in consumer technologies and identifying evolving business models. The Parks Associates team serves the world’s leading semiconductor, software, consumer electronics, telecom equipment, and entertainment companies, providing them with industry analysis, consumer research, and go-to-market recommendations. Stuart’s recent industry presentations include the outlook for residential energy management, new business models for the connected home, and the evolution of new video services.

Stuart has served technology companies for over twenty years, designing technical service, software, and hardware solutions for companies ranging from global semiconductor manufacturers to one of the nation’s largest airlines. In his positions with companies including AT&T, NCR, OpenConnect Systems, and Intelligraphics, Stuart’s roles have included sales, product marketing, marketing communications, and executive management.

Stuart holds an MBA from SMU and a BA in economics from Vanderbilt University.

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