This weekend, news broke that
No doubt an Apple entry into this space will have lots of consequences long term, but not all of them will be necessarily negative. Smart home is a complex market, one with lots of different players, and for some Apple's entry might actually be a net positive.
Below is a look at how an Apple smart home push could play out for different players.
Smart Home Platform Startups
There are a number smart home startups that have entered the market in the last year or two with new DIY smart home platforms. Companies like SmartThings and Revolv offer hubs and associated software frameworks that allow a consumer to build a smart home for a few hundred bucks, and both have done a fair amount of third party point solution integration to work with locks, lights and other devices.
At first blush, it would seem these companies could be hurt by Apple. After all, a huge percentage of consumers today are already heavily invested in the Apple ecosystem, and if an Apple smart home leveraged an existing Apple product to act as a smart hub to connect and control various devices in the home, this would allow the consumer to forego a purchase of a purpose built hub from one of these startups.
But it might not be so simple. Apple's entry could also generate interest in some of these platforms, particularly for those companies and consumers who would prefer to not cede control of their home to Apple. SmartThings, for example, has fostered a community of developers who have created apps for the platform, which could serve as a valuable jump start for an acquisitive consumer technology company looking to build its own smart home system.
Outlook: Mixed
Smart Home Service Providers
Big cable has taken a significant interest in the smart home the last few years, with most of big cable offering their own managed smart home services. These offerings usually cost somewhere between $25 and $50 a month and work with a number of third party smart home products like locks, lights, cameras and more.
In many ways, Apple's entry to the smart home will be the "over-the-top" alternative to that of big cable. Much like consumers saw an opportunity to side step pay TV by buying an Apple TV or Roku, some will eagerly look to do so by buying a smart home solution from Apple. At the same time, some consumers may get their feet wet with a DIY solution from Apple, but long term may "grow into" wanting a managed offering, complete with call center monitored security.
Ultimately how the cable providers fare will depend on how complete Apple's offering is. If Apple knocks it out of the park from an ease of use standpoint and can create a reasonable substitute for a managed offering, these companies could take a hit.
Outlook: Cloudy, with a chance of trouble
Smart Home Point Solutions
The great thing about the growing smart home space has been the resulting explosion in new connected devices for every aspect of our lives. Everything from new light bulbs to crock pots to smoke alarms to thermostats are controllable via a mobile device. While many of these devices have their own apps, makers of point solutions also are actively integrating their platforms with smart home hub manufacturers.
Some, like Nest, are more closed, but I think most point solutions providers like this will eventually see the benefit of opening up to work with other platforms (particularly if they get a call from Apple).
The result? I think Apple's entry into the smart home waters will rise the tide for many of these players, particularly if they can put a "works with iHome (or whatever Apple's smart home is called).
Outlook: Rising tide will lift quite a few boats
Established Smart Home Platforms
While Apple would certainly catalyze the market, some already in the market might say things are going just fine, thank you. Companies like Belkin, INSTEON and Vera have all built fairly substantial installed bases for their products, and with Apple's entry they could gain some significant competition overnight.
The outlook for these companies is the hardest to predict. The fact that they already big communities of users, large rosters of third party hardware partners and, to certain extent, established brand recognition could serve these companies well in a market where they count Apple as a potential competitor. Additionally, some like INSTEON have shown a willingness to embrace other platforms, so there's also the chance they could be open to working with Apple.
But in the end, there's no avoiding the fact Apple could provide an alternative to these companies in the DIY smart home market and will certainly force them to up their game.
Outlook: Overcast with possible sunbreaks
Michael Wolf is a smart home analyst. Follow him on Twitter, listen to his smart home podcast or check out his latest report on smart home security.
