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30 May 2014

Apple to enter smart home at WWDC

Rumors abound that Apple will unveil its plans for the smart home at its Worldwide Developer Conference (WWDC) on June 2nd. It is expected that software will be revealed that would allow Apple devices to control lighting, security systems and appliances. WWDC is anticipated to be the launch platform for iOS 8 and the desktop OS codenamed Syrah too, likely putting home automation on the feature list of the new operating systems.

According to the rumors, Apple intends to enter the smart home as a software-only platform initially. All that would be needed is an Apple device to control the smart home equipment. However, the need to add additional radios, such as the mesh networking low-energy ZigBee protocol, may force Apple to introduce a smart home hub (or incorporate it into the Apple TV) if it wants to create a capable smart home ecosystem ‘ which might not be possible with just the Bluetooth and WiFi found in most current Apple devices, due to the short range of Bluetooth and the congestion of WiFi.

Apple is now poised to set a standard approach for the smart home. As much of the mobile industry imitates its devices, choosing a standard for smart home connectivity could create a common platform for the IoT. But Apple has gone it alone with closed-systems before, which don’t see mass adoption ‘ so this is something of a crossroads.

As almost all Apple devices include WiFi and Bluetooth (Bluetooth Low Energy since the iPhone 4S, now rebranded as Bluetooth Smart) these two protocols will almost certainly form the backbone of Apple’s smart home communication system. If the rumors are true that the next iPhone will include NFC, it will provide another protocol by which to interface with the home, albeit at very short range.

There have been signs for a few months that pointed towards an announcement like this. Apple received a US patent on November 5th that concerned ‘a system and method of determining location of wireless communication devices/persons for controlling/adjusting operation of devices based on the location.’ The application outlines ‘lighting systems, security systems, garage door openers, music controllers, climate controllers and kitchen appliances’ that would react to user location.

In addition, Apple already sells smart home products. It carried the Nest thermostat in its stores, although will likely stop now that Google has bought the company, but also carries the Philips Hue smart LED bulbs. The Hue screws into existing light sockets and are controlled by an iDevice paired with a Philips hub plugged into the WiFi router ‘ bridging the gap between the WiFi phone and the ZigBee chips and aerials in the bulbs and hub.

We suspect that Apple would like to remove the coordinating hub and shift its functionality into software if possible. However, and as mentioned above, additional communication protocol hardware could be built into a dedicated home hub if needed. After all, you can’t turn aerials into software.

One rumored application uses an iPhone as a personal locator used to trigger lighting, switching on when a user crosses the threshold of a room. Using the phone to track the user in the home, instead of using a system of motion sensors and cameras, could significantly reduce the BOM costs needed to install the smart home.

However, relying on a phone for this function relies on the phone accompanying the user around the home, and any other people in the home too. This is an impractical model, as there aren’t and likely won’t be enough iDevices in the home for this system to work ‘ but there are enough iDevices in US homes to give Apple the largest percentage of smart home deployments overnight. This would allow any home with a suitable Apple product to begin adding smart home products with an app being the only prerequisite.

There are two main ways that the average US home will become a smart home. We think that the most likely entrance will be as a value-add service that is part of a TV or internet subscription. This would see smart home functionality imported into the house inside the CPE of the operator, and at a much faster rate than each home adding new technology in a piecemeal and budget-permitting fashion.

The second route to mass adoption is what appears to be happening with the Apple rumor ‘ through the smartphone acting as the remote control for the home, possibly with a small dedicated home hub to house additional wireless communication protocols.

Existing smart home products frequently use smartphone apps that work independently of each other. This has led to users needing pages of apps to control what would ideally be a single system. Expect Apple to unveil a single app to unite all connected home systems under one banner’ iHome or something similar, with a badging system to identify compatible products, as found with the ‘Works with iPhone’ branding.

There is something of a conflict of interest with Apple’s traditional business model and the gradual or subscription-based adoption models we envisage. Historically, Apple charges a premium for its own hardware and encourages users to enter the Apple ecosystem, where they can profit from further transactions in products like iTunes and the App Store. As Apple is unlikely to start making washing machines and HVAC systems, it remains to be seen if the smart home will be a standalone revenue generator for the company or an approach designed to attract new customers to the Apple ecosystem on the back of the connected home.

The smart home move expands upon its entry into the automotive market with CarPlay, which brought it into competition with Google, Microsoft and Blackberry. In the home, Google appears to be laying the foundations for a smart home platform, with its comparable smartphone penetration thanks to Android in millions of mobile devices and its $3.2 billion purchase of Nest and its thermostats.

Other vendors like Samsung and LG manufacture home appliances as well as their mobile devices. There is a chance that companies such as this would use their phones as platforms for smart home control, especially Samsung which is widely regarded as the flagship Android phone, but the market penetration of iOS and Android is much greater than either LG or Samsung, undermining the success of such a project on deployment figures alone.