It seems that the smart home and Internet of Things (IoT) opportunity for broadband service providers is not selling bandwidth, but selling an experience, certainly for the foreseeable future. That could mean providing the gateway that aggregates different services and applications, and it could mean managing the QoS on the home network. It could also mean carrying out the professional installs.
Margaret Ranken, Principal Analyst at Machina Research, which provides strategic market intelligence on the Internet of Things, says there is a danger that the smart home becomes a burden to service providers if all they get is more traffic on their pipes. “I do not think the pipe is what matters here. If you are going to have a comprehensive smart home hub that connects the heating and doors and windows, that is a challenging self-install. Some fire alarms will need professional installation. So the field force that a service provider has [installers and engineers] and the customer relationship are what matters.”
She adds: “People will want to buy different products from different vendors and hope that they talk to each other. The role of providing the central hub for the smart home is still up for grabs.”
In January Machina Research published its latest Strategy Report called ‘IoT Platforms Best Practices’ and stated that it is not the feature-sets and functionality of the platform that offer the key differentiator but factors like support and a robust partner, systems integration and developer ecosystem. A focus on the customer will also be a key differentiator.
Charles Cheevers, CTO for Customer Premises Equipment at ARRIS (provider of broadband gateways, set-top boxes and broadband access equipment, among other things) believes the broadband operator can become the entity that aggregates third-party services and presents them to the customer, even if they can also be accessed through independent apps. This kind of ‘onboarding’ should mean a better consumer experience, and minimise the number of devices in the home.
There is also an argument that the service provider is best placed to have an overall view of everything that happens in the home, and therefore to help different subsystems communicate with each other, leading to a unified user experience.
Lionel Gremeau, Product Marketing Management Director at SoftAtHome, which provides a unified software platform for gateways and set-top-boxes, provides some examples. “Cameras can be seamlessly integrated into the LAN with the right QoS already configured in the operator home gateway. Users can access camera streams from the operator’s television UI to monitor their entrances or see that their babies are sleeping well…The home gateway detects that my son is back home, indicated when his mobile phone Wi-Fi has been seen or a Bluetooth Low Energy tag is detected.”
Operators can use open software platforms within their home gateway to enable the integration of third-party IoT devices, which Gremeau views as a great opportunity. “This will lead towards aggregated services whose total value will be greater than the sum of their parts,” he argues. “This will usher in new revenues for operators, as well as increase customer satisfaction and reduce churn.”
The research firm Gartner says cable, Internet and alarm companies and mobile phone operating system providers are actively creating platforms and ecosystems in an attempt to break into the IoT gateway market. “We predict that the most successful will develop a system that seamlessly integrates with nearly any vendor’s IoT application and is relatively painless to the homeowner. A system that locks homeowners into one specific operating system limits their opportunity.”
Cheevers says service providers must break through siloes and deliver a converged experience. “The opportunity for the operator is to do this better than Google or Amazon could. You need to leverage service provider connectivity.”
Having the ‘global’ view of the Gigabit home means service providers can take up the role of the QoE guarantor. Corrado Rocca is Executive VP, Product Management & Development at ADB, a company that provides set-top box and broadband customer premise equipment and software. He points out: “Operators control the entry point into the house and have the ability to look around it in a way that companies like Google cannot.”
He notes how his customers can use standard protocols to access data on devices that are on the home network and establish a unified view of QoS. “The ability to provide QoS monitoring and management will become more relevant in a world with more devices,” he states. “And if you introduce services like [connected] health then they become critical services.”
Rocca thinks it is important that service providers convey the value of this QoS management to their customers. It may then be possible to monetise the function, like charging a few EURO per month for a ‘Geek Squad’ of trouble-shooters. And he reminds us that video, with its higher bandwidth requirements, will be one of the services that needs QoS management.
Sam Rosen, Managing Director and Vice President, Video, OTT and AR/VR (augmented / virtual reality) at ABI Research, thinks there is another way to monetise QoE management. “There is the expectation that for some IoT services with special requirements, the [IoT] service provider will pay for carriage along with higher QoS guarantees measured in latency, throughput and low error tolerance thresholds,” he says.
The Smart Home and IoT may not bring lots of value to service providers immediately, admits Gremeau at SoftAtHome. “It may just appear to be a medium for gadgets,” he adds. “But it will become part of the all-important fifth play that enables new use-cases to be introduced, some of which will be revenue generating.”
When it comes to wireless connectivity for the IoT, the focus is on ultra reliability and low-latency, rather than bandwidth and that could mean a role for cellular networks. If you are offering eHealth services, it is critical that the hub can connect with someone who may have fallen, and is now immobile in the corner of a house. The stronger the wireless coverage (of whatever kind), the longer batteries in remote IoT devices should last, too.
When designing their gateways, service providers can cover most of the future IoT wireless requirements by supporting a handful of protocols and technologies, like Bluetooth Low Energy, Zigbee and Thread.
How service providers can own the Gigabit home
This story is an excerpt from the new Videonet report, ‘How service providers can own the Gigabit home’. It considers where the demand for Gigabit speeds is coming from, looks at the access network technologies needed to dramatically increase capacity, and investigates the technology needed to ensure the wireless home network does not become a bottleneck.
The report also investigates how service providers can ‘own’ the home in the Gigabit era – maintaining primacy within increasingly complex home networks characterised by third-party smart home / IoT services and retail brands who want their devices to ‘move in’.
The 5,000 word report includes original insights from ARRIS, TDC, DNA, ABI Research, Ovum, RDK Management, Celeno, SoftAtHome, Comcast, IHS Technology, Machina Research, MoCA, Nokia and ADB. Like all our reports, it is completely free and you can download it here.
Photo: Family enjoying broadband services (courtesy of ARRIS)
