There has been a lot of discussion about the future of the smart home and IoT devices and I still bump into people in various industries that believe the market is being hyped and won’t deliver. While the sceptics do what sceptics do, there continues to be a bunch of new innovative product launches and a steady stream of new players entering the space.
However, the company stealing the lead in this space is Amazon and the news that they have now acquired Ring should worry competitors because it’s a clear sign of intent. The launch of Alexa and the use of voice was an important innovation but, in reality, it was just another IoT device with some interesting new capabilities.
The acquisition of Ring shows real vision because they now have the capability to launch a much broader IoT and smart home products and services to the mass consumers. In acquiring Ring, they are picking up an innovative product set, a brand with good consumer traction; however, Ring had recently absorbed Zonoff into their business so they are getting a capable platform. For those less familiar with Zonoff, they had developed a true smart home platform that supported open standards; Ring were going to use this to integrate a much wider range of devices and services into their offerings.
With this acquisition, Amazon now have the full suite of capabilities to dominate the smart home market and that should worry a bunch of traditional industries.
The real battle for the smart home is not always obvious. In my view, it’s about getting direct access to the home and opening up a meaningful relationship with consumers that will enable a new breed of service providers to leverage data to deploy new value-added services. Fundamentally, it’s a move from just selling hardware to leveraging data from devices to deliver services.
I suspect Amazon will launch a much broader range of smart home devices and services using Alexa as a hub and then start mashing them with 3rd part offerings such as home maintenance services and insurance. In the emerging smart home world, aggregators – companies that provide a broad and comprehensive bundle of value added services – will be the king.