Providing market intelligence for more than 35 years

CED Magazine

Home automation: The new frontier for service providers

Now that broadband penetration has flattened out, Parks Associates’ Tom Kerber, director of research for home controls and energy, said telecom providers are looking for ways to bring in additional revenues through services such as home automation, online tech support and digital lockers.

“It is to some extent about maintaining share, and potentially gaining share, but also about that incremental revenue and RPU,” he said. “It’s a little too early to tell [about churn], but I will say we had asked the question, ‘Would you switch for someone that had this service?’ And the answer was roughly 15 percent had very high interest in switching for someone who had a home automation/home control system. I think when you’re in a mature market, it’s about fighting for those customers.”

Kerber said that while telecommunications providers have the advantage of offering home automation services over their data pipes to their subscribers, an HVAC vendor, such as Trane, can upsell a customer on its home security service at the point of sale for an air conditioner. Heynen said that cable operators also face stiff competition from entrenched home security companies such as ADT.

While Comcast’s Bowling said he sees home automation as a greenfield opportunity, the lure of potential revenues has also attracted the attention of retailers and utilities in addition to service providers and traditional security firms. According to Parks Associates, annual subscription revenues from the various system offerings will be more than $180 million by 2015. Parks estimates that 60 percent of homes across the nation will have some type of networked energy management system by 2022.

From the article, "Home automation: The new frontier for service providers" by Mike Robuck.

Previously In The News

Report: Targeted advertising will start to hit paydirt next year

Pay-TV providers will start to cash in on advanced addressable advertising campaigns by the middle of next year, according to a report by Parks Associates. Revenues across the nation for addres...

From CES: Wireless Video, Tablets, and TV Everywhere

The accelerating trend, according to Brett Sappington, senior research analyst for Parks Associates and moderator for the Next –Gen Video Services session, is TV everywhere. "Cable, telcos and other...

OTT Churn: Netflix Has Lowest Rate in 2015

Churn isn’t just an issue for traditional pay TV providers. Over-the-top services suffer it as well, of course. Parks Associates revealed OTT data yesterday showing that at the end of 2015, approxi...

IP-based home security services on the rise

According to Parks Associates, more than 20 percent of households across the nation will have installed IP-based multi-service home networks by 2015. Homeowners are starting to gravitate toward...