Friday, August 01, 2014

Exploring the Smart Home Systems Market Opportunity

The notion of a Smart Home -- where technology is a central part of enabling new digital lifestyle advances -- has been discussed for more than a decade. It appears that the concept is finally gaining traction in 2014, even within Europe.

According to the latest market study by Strategy Analytics, 11 percent of UK households will have at least one smart system by the end of this year, rising to over 27 percent of households in five years.

The number of UK households with some form of smart home system -- automated entertainment, energy, appliance, security or healthcare systems typically controlled remotely through internet technology -- will increase 43 percent on last year to 3.1 million in 2014, spending a total of £715 million.

This is forecast to double to £1.4 billion across 7.7 million UK households by 2019.

"While telecom brands are leading the drive in Europe, energy companies are dominating the early take-up of smart homes in Britain," said Bill Ablondi, director at Strategy Analytics.

Market Development Progress in the UK

British Gas re-launched its smart home thrust in late 2013 under the "Hive" brand and now has almost 100,000 subscribers. In addition, Google subsidiary Nest struck a deal to offer its stylish thermostat through nPower while E.ON is actively preparing its launch after a trial in Milton Keynes.

Smart home systems adoption will be boosted by consumer electronics companies, such as Apple and Samsung, becoming key players as they develop their strategies to evolve wireless home networks.

The big CE companies will be joined by a steady stream of single-purpose devices from various other companies -- including Belkin, Dropcam, Piper and Tado -- making it easy and affordable for people to set up at least one smart home device.


How the UK Market Compares Globally

The global market study -- conducted across the U.S., China, France, Germany, Italy Spain and the United Kingdom -- shows the UK will be well ahead of the global average (5 percent of households) in smart home adoption this year.

However, that still places the UK considerably behind the U.S.  market (17 percent). Worldwide revenues in 2014 will reach £29.3 billion, with the U.S. market accounting for around 37 percent (£10.9 billion).

In contrast, UK smart homes will spend an average £234 each on the technology, that's estimated to be less than half that of U.S. homes (£517).

Ablondi concluded "Annual revenues from smart home related hardware, services and installation fees will grow by just under 20 percent each year to nearly £70 billion worldwide in 2019 when 224 million homes, or nearly 1 in every 8.5 globally, will have at least one type of smart system installed."

Thursday, July 31, 2014

How the Mobile Channel will Boost Coupon Redemption

Smartphones are increasingly viewed by savvy marketers as a critical enabler -- not merely of ubiquitous connectivity and interactivity, but as a means to engage in a meaningful way with their customers and prospects.

From a marketer's perspective, the fact that smartphones are personal and ever-present with their owner -- and that those owners are interacting with their device constantly -- presents them with an opportunity.

To the informed marketer, mobile is no longer merely a channel through which to sell goods remotely, but a series of related channels through which their relationship with the customer can be nurtured and developed over time.

This is a basic principle of multi-platform marketing communication. The approach can transform legacy marketing practices -- such as the process of offering a discount coupon for redemption -- via the creative application of mobile devices.

According the the latest global market study by Juniper Research, they now forecast that there will be 1.05 billion mobile coupon users by 2019, that's up from just under 560 million in 2014.

The surge in user numbers would be driven by increased retailer engagement with the various mobile channels. Retailers are now integrating coupons into loyalty programs to a far greater extent, while focusing on delivering coupons direct to consumers -- rather than relying on aggregator sites.

At the same time, Juniper observed that mobile coupon deployments were benefiting from retailers restructuring their businesses to reflect the wider transition to the utilization of online engagement channels.

It noted those retail businesses are becoming more agile, more efficient and able to implement change more rapidly than would have previously been the case -- prior to the progressive adoption of the mobile channel.


Mobile Technologies that Boost Coupon Redemption

Meanwhile, Juniper has argued that while the use of MMS for couponing was expected to cease, disruptive technologies such as Near Field Communications (NFC) and in-store beacons had the potential to boost mobile engagement in the medium term.

"While NFC has failed to achieve traction thus far, the emergence of a cloud-based secure element through HCE (Host Card Emulation) is likely to stimulate greater integration into wallets. We believe that this in turn will provide the visibility that should encourage brands to run campaigns using the technology," said Dr Windsor Holden, research director at Juniper Research.

Other key findings from the study include:

  • Geo-Targeting has provided SMS-delivered coupons with a new lease of life, with retailers seeing high redemption rates from coupons pushed to consumers near their stores.
  • Brands are increasingly leveraging the retail database to deliver targeted coupons.
  • Lack of adequate point of sale (POS) redemption technology remains the key hurdle to greater deployment and adoption.

Wednesday, July 30, 2014

The Upside for Indoor Beacon Personal Proximity Apps

While the broad concept of the Internet of Things may be difficult for people to grasp, one basic concept is already familiar within the mainstream population -- that being the practical benefits of GPS and location-aware technologies.

Healthcare, enterprise, mobile wearables and indoor beacon applications will help to revive the global positioning system (GPS) tracking device market, with ABI Research forecasting the market to reach over $3.5 billion in 2019.

The GPS personal tracking market has always had huge potential yet it has faced significant barriers around awareness, expensive devices, cellular subscriptions, indoor location and market fragmentation.

As a result, market development has never been able to scale sufficiently to lower costs and create the revenue to support much needed marketing and advertising campaigns. But that's about to change.

According to the latest market study by ABI Research, the upside will now be driven by the adoption of GPS applications across family, lone worker, pets, personal assets, the elderly and in-home healthcare.

"The potential of this market continues to draw investment and interest. Over the last 12 months, there has been a host of companies entering this space," said Patrick Connolly, senior analyst at ABI Research.

A steady stream of start-ups with new GPS applications are moving into areas such as mobile workforce management, while the connected home market will evolve to support personal protection apps across children, pets, cars, etc.

Moreover, telecom service providers that are eager to solve the problem of saturated markets for traditional services have already begun to reconsider this space with the dawn of GPS-enabled wearables and the Internet of Everything.

This growth potential is reflected in a significant increase of GPS IC shipments into this sector over the past year, as low-cost GPS units become adopted worldwide for a host of new practical applications.

Beacons are set to be a major market driver, solving the issue of indoor proximity awareness, while also creating a low-cost entry point for vendors. With Bluetooth Low Energy (BLE) beacons forecast to penetrate into all aspects of life over the next 3 years, consumer awareness and acceptance will emerge.

Tuesday, July 29, 2014

Network Virtualization will Advance the Telecom Sector

As new technologies continue to evolve, open network virtualization strategies are reshaping the telecom carrier ecosystem. The ongoing shift to cloud services and mobile internet technologies is driving service providers and their suppliers to improve their efficiency and agility.

According to the latest market study by International Data Corporation (IDC), network virtualization is set to revolutionize the telecom sector -- transforming the operational culture, as well as the fabric of legacy proprietary infrastructures that have, until now, dominated this industry.

Communication service providers (CSPs) and their vendors are embracing the demand for progressive network virtualization platforms -- such as open-source software-defined networking (SDN) and network functions virtualization (NFV).

"Despite budget concerns and questions about the ability to execute on the network virtualization vision, CSPs, telecom vendors, and partners are all embracing potential opportunities," said Elisabeth Rainge, research vice president at IDC.

IDC believes that network virtualization for telecom represents some significant challenges, but the upside is extremely high. Moreover, while not everyone will reap the benefits of this transformation, IDC sees an evolution of digital infrastructure that is already underway.

During the first half of 2014, a series of announcements provided concrete evidence of the maturity of network virtualization. Because ongoing discussions emphasize the long-term visions for various new technologies, and the larger concept of network virtualization, a clear picture of the activities can be somewhat difficult to discern.

Meanwhile, vendors will resort to network function virtualization and software-defined network architecture to catalyze use cases -- such as the voice over LTE (VoLTE) network evolution.

However, with the talk of moving away from a five-nines model in the name of service agility and flexibility, it remains to be seen whether and how NFV and SDN can ensure faster deployment while maintaining high standards of quality of experience.

Many existing CSP network elements, such as service provider routers, Ethernet switches, and packet optical switches, will transition over the next few years to become software-enabled and programmable with open, northbound interfaces.

IDC says that many networking vendors are already delivering their first generation NFV-based Virtual CPE solutions, and a number of leading CSPs will begin to launch commercial virtualized telecom services -- beginning in late 2014.

Monday, July 28, 2014

Fragmentation of the Worldwide Media Tablet Marketplace

The apparent softening of the media tablet market may concern some vendors. Clearly, there are signs of saturation in a few of the developed markets. However, the worldwide tablet market grew 11 percent year-over-year in the second quarter of 2014 (2Q14) with shipments reaching 49.3 million units, according to the latest market study by International Data Corporation (IDC).

Although shipments declined sequentially from 1Q14 by -- by an estimated 1.5 percent -- IDC believes the market will experience positive, but slower, growth in 2014 compared to the previous year.

"As we indicated last quarter, the market is still being impacted by the rise of large-screen smartphones and longer than anticipated ownership cycles," said Jean Philippe Bouchard, research director at IDC.

IDC attributes the market deceleration to slow business user adoption of media tablets. Although, the previously reported BYOD to work phenomenon seems to somewhat contradict this assessment.

Despite this trend, they believe that stronger commercial demand for tablets in the second half of 2014 will help the market grow and that we will see more enterprise-specific application offerings -- as illustrated by the Apple and IBM partnership.


Tablet Vendor Market Share

Despite declining shipments of its iPad product line, Apple managed to maintain its lead in the worldwide tablet market, shipping 13.3 million units in the second quarter.

Following a strong first quarter, Samsung struggled to maintain its momentum and saw its market share slip to 17.2 percent in the second quarter.

Lenovo continued to climb the rankings ladder, surpassing ASUS and moving into the third spot in the tablet market, shipping 2.4 million units and grabbing 4.9 percent markets share.

The top five vendor ranking was rounded out by ASUS and Acer, with 4.6 percent  and 2 percent share, respectively. Share outside the top 5 grew to an all time high as more and more vendors have made inroads in the tablet space.

By now, most traditional PC and mobile phone vendors have at least one tablet model in the market, and strategies to move bundled devices and promotional offerings have slowly gained momentum.

Until recently, Apple, and to a lesser extent Samsung, have been sitting at the top of the market, minimally impacted by the progress from other vendor competitors. But there's new growth among the smaller vendors and a leveling of market share. This is causing some degree of market fragmentation -- which is a good thing, for design innovation and pricing flexibility.