The Z-Wave Alliance recently released its second annual Z-Wave State of the Ecosystem Report, which examines smart home and connected technology — both in and outside of the home — and explores the smart home landscape as it exists today, current and future trends and new opportunities, with an emphasis on the role Z-Wave technology plays in the advancement of the industry.
Here, Z-Wave Executive Director Mitchell Klein talks with SDM about the most shocking findings, the effect of coronavirus on the ecosystem, future predictions and more. Find the full report here.
SDM: This is the second annual report of its kind. Why did you decide to make it a yearly release, and did you do anything differently from last year?
Mitch Klein: At CES 2019, the Z-Wave Alliance issued our very first State of the Ecosystem Report. This was the very first time all the exciting information surrounding the Z-Wave ecosystem and great work our members were doing was included in one document. While at the show, we handed out report copies to member companies, exhibiting members, press and attendees who stopped by the Z-Wave Pavilion to learn more about the Z-Wave protocol. The response was overwhelming and we received a lot of direct feedback. The consensus was that a condensed document with all the information needed about Z-Wave, members, smart home opportunities and data was incredibly helpful.
One of the largest differences between our recently published report and the one issued at CES 2019 is the length. Our first report was nearly 30 pages and a massive undertaking. The feedback we received on the first report was all of the information was wonderful, however, it was a large document to move through. For that reason, we worked to ensure the second version was more succinct.
In the 2020 report, we decided to remove the member spotlight section to leave additional room for Z-Wave news and information all of our members and readers of the report could benefit from. We wish we could produce a report detailing all of the interesting work our members are doing in the smart home and security space but that report would be even longer than our first one.
To make our 2020 State of the Ecosystem as educational as possible, we reached out to industry experts to include their insight on the direction the industry is heading and how we can best prepare for the future. We’re really pleased with that section of the report as it highlights insights and voices from experts across the industry.
So much can change in a year, especially in our industry, which is why we felt it was important to take the time to mark where Z-Wave stands in 2020 and issue predictions about the years to come. We look forward to the 2021 State of the Ecosystem report.
SDM: What were some of the most shocking findings in the report?
Mitch Klein: Even though we live and breathe this industry every day, one of the most shocking findings of the report is just how much growth is still expected within the smart home and security industry. This is especially true when you start to take a closer look at specific regions around the globe and predict where they will stand on the smart home adoption stage in just a few short years. Currently, the top three Z-Wave Alliance member location demographics include North America, Europe and Asia. We predict we’ll be adding at least a few more locations to that list in the not too distant future.
SDM: Was the impact of COVID-19 examined in the report? If so, what were some of the findings?
Mitch Klein: Though not directly examined within the report, COVID-19 has undoubtedly had an impact on the smart home and home security space. The Alliance has spoken at recent virtual events and presented keynotes on resources available to members about how we can all collectively weather this storm.
To that end, the Z-Wave Alliance stands as a resource to member companies, manufacturers and even security dealers and integrators who may need assistance at this time and we welcome their outreach.
SDM: What were some of the biggest trends in the smart home space in the past year, according to the report?
Mitch Klein: For starters, the smart home opportunity has never been stronger. This spans a number of residential segments including water, comfort, access, sensors, lighting and of course, security.
While I do not want to spoil all of the data included within the report, a couple of key device categories, including doorbells, water sensors, smoke and air quality sensors and new all-in-one devices, are all primed for a huge amount of growth in the coming short-term.
The 2020 State of the Ecosystem report includes key insights on sub-categories security dealers should be interested in. Aside from smart home findings, the report includes data and information on the growth and opportunity of multi-dwelling units (MDU), the insurance sector, aging-in-place, home healthcare, entertainment, real estate and professional installation.
A key stat for those serving the security industry, our report indicates 37 percent of smart home device purchasers attributed that buying decision to providing greater security for their family.
SDM: What do you predict to be the biggest trends in the next year?
Mitch Klein: When it comes to trends to be on the lookout for in 2021 and beyond, AI-powered, contextually aware systems and extension beyond the boundaries of the home are the two that come top of mind.
We’ve already started to see the demand and use of AI capabilities continue to grow within the context of the smart home. AI and context-aware smart home technology provides users with a simpler, more streamlined, and personalized smart home experience. Sensors in the home, as well as outside data, guide devices in intelligently making decisions based on past preferences, proximity and room presence trends and more. Information such as the weather will also enable the contextually aware home to adjust heating, cooling, lighting and more, improving the user experience and reducing the need for pre-programmed scenes, mobile control or even voice control.
Of course, the smart home industry will continue to grow and evolve exponentially in the years to come. One prediction is that 63 million American homes will qualify as “smart” within the next two years. We see smart home technology growing ever more mainstream and will become an expected part of the modern household in the same way that home entertainment, audio and other technology has in the past. We predict households with smart locks, thermostats and connected lighting will become the “new normal” and as we’ve witnessed through this first round of the pandemic, consumers are seeking out ways to improve their home safety, security and convenience.