2019 was indisputably a crazy year in technology, from the parade of social media company executives jousting with members of Congress, to the entry of big players like Apple and Disney into the streaming business, to the introduction of new smartphone designs with “foldable” displays. As I limber up and prepare to spend four days at the enormous Consumer Electronics Show in Las Vegas in early January, I fully expect 2020 will be chock full of tech initiatives and new products with the potential to change people’s lives. Here’s my take on four big potential smart home game changers in the new year.
Finally, a smart home consortium that might have a real impact
I’ve never been a big fan of consortiums, especially in the tech field. They often do not produce the desired long-term results or benefit consumers. Moreover, technology consortiums sometime have the unintended consequence of stifling innovation—some companies struggle to differentiate themselves outside the group's baseline mission.
Things will hopefully go differently for a new association called the “Connected Home Over IP” group, which already boasts big players like Amazon, Apple, Google and the Zigbee Alliance. The mission of this consortium is to develop an open-source smart home connectivity standard. Despite the Zigbee connection, this announcement is not an update to the low-power, 802.15.4-based Zigbee wireless standard (which mostly competes with Z-Wave in the mesh networking home automation space). Rather, the group’s long-term objective is to create a ratified, royalty-free, multi-source wireless standard (including cellular in the future). For all its promise, the smart home suffers from having multiple wireless and connectivity standards. This makes it very challenging for companies to offer secure, reliable, robust communications across multi-vendor smart devices, mobile apps, and cloud services. Security is a central focus for this new consortium, and you can expect this announcement to have a huge impact on voice services such as Amazon Alexa, Apple Siri and Google Assistant.
If Project Connected Over IP is properly executed, the new standard has enormous potential to unite the fragmented smart home ecosystem.
2020: the year of 5G and WiFi 6?
Despite all the fanfare, 5G was overhyped in 2019. Though 5G-enabled phones did begin to show up last year (most prominently from Huawei and Samsung), Apple took a pass on 5G in its iPhone 11, announced last September. Apple’s decision to exclude 5G was almost certainly based on the extremely modest buildout of 5G infrastructure during 2019. However, it also coincided with Apple’s purchase of Intel’s 5G business—it will require time for Apple to introduce its own 5G modem. This point is significant given Apple’s market share position (42% in the U.S. market at the end of 3Q19, according to Counterpoint.com)—it’s hard to envision a robust 5G rollout without Apple’s participation. Having said that, Apple’s 2020 iPhones (possibly with some help from Qualcomm in the short-term) are widely expected to support mmWave—a flavor of 5G cellular technology that achieves lightning-fast speeds and mitigates line of sight (LOS) problems (meaning you can use it effectively in a building or home). 2020 will largely be a growing pains year for 5G as all the major carriers roll out their implementations in various phases. That said, I expect 2020 will be a big year for 5G-enabled smartphone sales as consumers begin to future proof their purchases.
Less heralded, but in my view equally as important, will be the rollout of 802.11ax (otherwise known as WiFi 6) wireless technology in smartphones, laptop computers and IoT devices. I’ve been pleasantly surprised by the WiFi 6-enabled routers I’ve tested over the past six months and, as I've written before, I believe WiFi 6 has not gotten its due in the media. Almost every major smartphone (including the new iPhone 11) and laptop computer introduced over the past several months includes WiFi 6 technology. Throw in a new WiFi 6-enabled router, and you’ll be able to enjoy the technology’s performance and reduced latency. It’s a lengthier discussion, but I also expect we’ll see new “combo” 5G/WiFi 6 routers. These will be especially appealing to consumers who use 5G as a cost-effective broadband pipe into their home but need protected, secure WiFi 6 network access. I expect Netgear to be a major player in this emerging product category, which could have serious implications for the smart home.
Cord-cutting streaming services will continue to get more expensive
One of the more unfortunate trends in 2019 that will likely continue is the steady increase in the cost of cord-cutting streaming services. Nearly all of the major cord-cutting platforms, including Netflix, Hulu, and (most recently) Sling TV, increased the monthly cost of their streaming service subscriptions. Sling TV, perhaps the most popular live TV streaming service from a subscriber standpoint, added 214,000 subscribers in 3Q19 to bring its total subscriber base to 2.686 million. However, the company also raised the prices of its “Orange” and “Blue” tiers in December as a result of its decision to add more live news, sports channels and enhanced DVR support.
Despite more competition in the streaming content channel space (with the likes of Apple and Disney), consumers shouldn’t expect these price increases to slow down this year—particularly with the streaming services that include live TV programming. One of the major drivers behind the cord-cutting phenomenon was the ability to save cost versus a conventional cable or satellite subscription. These cable and satellite companies suffered their own cost problems as local broadcasters increased “retransmission fees” for local channels over the past several years.
Because consumer cost savings for cord-cutting are declining, expect to see consumers embrace products like Amazon’s Fire Recast, AirTV 2, and Tablo. These products are terrific complements to a streaming TV service like Netflix or Hulu because they provide free access to live local TV news, weather, and sports programming—they even offer DVR capability.
Cybersecurity in the smart home will get even more challenging
Given the exponential increase in IoT devices in the home, it is impossible to dismiss the importance of effective cybersecurity. Unfortunately, many consumers are so enamored with the benefits of the smart home technology that they are oblivious to the risks.
While conventional cybersecurity solutions (e.g., client-based anti-virus and firewall software, hardware and software-based VPNs, routers with better embedded security management tools, etc.) offer a higher degree of security and privacy protection for consumers, the fact of the matter is that continued denial-of-security (DOS) attacks, ransomware, identity theft, and data breaches are still common and show no sign of dissipating. Trend Micro recently published a devasting report predicting that 2020 will be a year of accelerated attacks by cybercriminals on IoT devices, many of which will leverage machine learning (ML) and artificial intelligence to commit espionage and extortion.
It’s high time for smart home device manufacturers to explore an “endpoint resilience” approach to cybersecurity, similar to the capabilities that Absolute Software offers in the enterprise space. Resilience is a fundamentally different approach to cybersecurity, with an emphasis on rapidly responding, recovering, and healing the devices in real-time. Absolute Software CEO Christy Wyatt recently wrote a compelling post in Forbes about why enterprise companies should approach endpoint security in this manner.
While this approach has proven to be extremely effective in large enterprises that deploy and manage thousands of client devices, it may be more challenging to implement it in a consumer context given the multi-vendor complexity of devices in the smart home. Regardless, smart home device companies should be listening—the potential benefits are tangible.
Some closing thoughts
This year’s CES features 2.9 million net square feet of exhibitor space and over 4,000 vendors. I’m confident that these aforementioned “predictions” will be validated in some manner in the numerous meetings, keynotes and demonstrations I’ll participate in this coming week. I’ll report back in late January with any surprises from the show—there always are a few. Stay tuned.