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Upside Opportunity for Smart Connected Appliances

Like the closely-related market for home energy management systems (HEMS), the smart appliances market has failed to develop as many in the industry had anticipated.

Most internet connected appliance product applications are still in the early pilot project stage and have failed to reach retail outlets in any large number.

However, according to the latest market study by ABI Research, shipments will soon begin to accelerate and eventually exceed 24 million units by 2017.

With smart meter deployment growing apace, energy costs following a seemingly upward trajectory, and progress made on improving interoperability of all aspects of the smart grid, it is only a matter of time before shipments gather momentum.

That being said, it is likely that it will take a couple of years for ultra-premium price tags to erode, and for dynamic pricing structures to become more widely implemented in order to stimulate consumer demand.

The number of major appliance manufacturers that have used recent trade shows as launch pads for new products is a sure sign that the market may soon see substantial growth.

"LG Electronics, for example, along with fellow South Korean appliance manufacturer, Samsung Electronics, are two of the first companies to have already brought a comprehensive range of smart appliances to market," says Craig Foster, senior analyst at ABI Research.

Whirlpool, BSH, Miele, and Electrolux are among the other leading players to have unveiled one or more smart products.

Additionally, the number of households with utility-provided HEMS will increase from an estimated 2.5 million households in 2011 to 36 million households in 2017.

Foster says, "In the early stages of the HEMS market, an almost unanimous perception existed that utilities would lead the way in terms of the deployment of these solutions."

However, utilities are now widely considered to have acted much slower than many anticipated, allowing many other routes to market to develop.

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