May 27, 2014 11:37 am

Apple seeks to open the door to simplified smart homes

(FILES) This file photo taken on April 8, 2013 shows a worker leaning to clean glass panels of the Apple store in the central business district in Sydney. US tech giant Apple was on March 6, 2014 accused of shifting nearly 8.1 billion USD in untaxed profits from its Australian operations to Ireland over the past decade. AFP PHOTO / FILES / Saeed KhanSAEED KHAN/AFP/Getty Images©AFP

For more than 100 years, inventors have struggled to find ways to improve on the humble light switch. Compared with much of today’s fiddly technology, it is reliable, intuitive and immediate. It never runs out of batteries, requests a reset or needs an operating-system update.

So when it comes to making home appliances “smart” by adding mobile apps and Bluetooth or WiFi connections, the bar for improvement is high and the chance of doing it without adding confusion and complexity is low.

House calls

House calls
Smarter technology at home

Into this mess steps Apple, with its constant promise to bring simplicity, clarity and ease of use – even if it is not yet clear to most people why the “connected home” is actually useful.

For many years, only the well-off could afford to install home-automation systems, which require significant structural work to houses and typically cost several thousand dollars, to control their lights, stereos or heating.

Now, the ubiquity of mobile devices and falling cost of wireless chips and other electronics components has allowed companies large and small to experiment with cheaper alternatives.

Larger electronics groups such as Philips, with its Hue lightbulbs, and Belkin, which makes a range of WeMo switches and accessories, have been selling products for $50 to $200 apiece that allow previously “dumb” parts of the home to be controlled via a smartphone.

Several start-ups have raised multimillion-dollar rounds of venture-capital funding over the past year, including Dropcam and Canary, two wireless security camera makers. At the end of last year, investment researcher CB Insights calculated that venture capital investors had put a total of $468m into smart home start-ups since 2012.

However, it is the entry of large technology companies such as Samsung, Google and Apple that hold the most promise of jump-starting the market, according to analysts.

LAS VEGAS, NV - JANUARY 07: Samsung spokesmodel Kai Madden displays the connectivity feature on a Samsung smart refrigerator at the 2014 International CES at the Las Vegas Convention Center on January 7, 2014 in Las Vegas, Nevada. CES, the world's largest annual consumer technology trade show, runs through January 10 and is expected to feature 3,200 exhibitors showing off their latest products and services to about 150,000 attendees. (Photo by David Becker/Getty Images)©Getty

Samsung's smart fridge

BK Yoon, co-chief executive of Samsung Electronics, in January unveiled a “glimpse into the home of the future” at the Consumer Electronics Show in Las Vegas, promising that customers could soon take phone calls from their fridges and make their dwellings more “flexible and responsive”.

Google’s $3.2bn acquisition in January of Nest, the smart thermostat company, was seen as an endorsement for the concept of the connected home, but the search engine company has not yet set out its broader vision for the market.

Apple will beat Google to the punch next week when it reveals its own plans for the smart home, according to people familiar with the iPhone maker’s preparations for its Worldwide Developer Conference in San Francisco.

The smart home market “is so nascent – this is really a hobbyist market today”, says Jan Dawson, tech analyst with Jackdaw. “It’s not mainstream at all and it’s extremely fragmented. Apple could galvanise the market.”

Digital music players and smartphones existed before the iPod and iPhone, Mr Dawson notes, but Apple’s entry with slickly designed products brought them mass appeal.

The connected-home software platform is a departure for Apple because its system will rely on hardware made by other companies, in contrast to its typical approach of vertical integration.

But it has gained valuable experience from the iPhone’s App Store and more recently CarPlay, a system for linking iOS devices to a vehicle’s dashboard. Apple will give other device makers a badge confirming their compatibility with its system, just as it has for several years to iPod and iPhone accessories such as headphones.

“The reason people want to work with Apple in the first place is it’s all about quality and being officially sanctioned,” Mr Dawson says. “That’s a very established model at Apple.”

Joi Ito, director of the MIT Media Lab and an investor in start-up SmartThings, a central hub for controlling smart devices in the home, says most companies working on smart home technology tackle just one small element rather than thinking of whole systems. “It’s very early . . . The home is very complicated. The question is, how much do people really want to hack their house?” he asks. 

There are a whole bunch of technical things [Apple] could do that would improve the responsiveness and simplicity of controlling things without compromising the individual hardware companies

- Tom Coates, Product Club

“We get this comment all the time that [the SmartThings hub] makes your home almost conscious,” Mr Hawkinson says. “It’s hard to imagine the big tech companies won’t want to have a very big stake in this. But they have a huge existing business to protect, rather than nothing to lose.”

While SmartThings is growing fast, its customer base today remains relatively small, in the tens of thousands. Like other start-ups, it will be watching carefully next week to see if Apple will become a partner or a competitor.

“There are a whole bunch of technical things [Apple] could do that would improve the responsiveness and simplicity of controlling things without compromising the individual hardware companies,” says Tom Coates, co-founder of Product Club, a start-up targeting the “internet of things”.

But he adds that some prospective partners may become uncomfortable if Apple tries to displace their own apps with a central controller of its own.

That leaves start-ups with a Catch-22 dilemma: if they do not sign up for Apple’s scheme, they may miss out on the smart home’s biggest sales opportunity to date, but if they do join it, Apple could “own” their customers and relegate them to being commodity hardware manufacturers.

A similar question faced mobile operators when Apple launched the iPhone with strict conditions that diminished the network providers’ role and emphasised its own.

“The big fundamental question is how much of the user interface stays with the individual manufacturers and their apps, and how much is incorporated into the Apple system,” Mr Coates says.

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