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Why Internet Service Providers will be the early Internet of Things winners

Why Internet Service Providers will be the early Internet of Things winners

“As the IoT gateway market emerges, Internet Service Providers will be the early winners in the battle for the home gateway."

The hype surrounding the Internet of Things (IoT) in the home is growing rapidly, as the battle for the IoT gateway in the connected home gets underway.

“The numerous IoT applications for the home include smart stoves, which tell you how to cook a meal and provide recipes; and smart washers and dryers, which help you determine the optimum time to run a load of laundry," says Paul O'Donovan, principal research analyst, Gartner.

“Add to that smart lighting, which can be operated remotely and programmed to dim or turn on or off at specific times; thermostats, which can have your living space at the desired temperature when you walk in the door; and entertainment devices, which can stream programming to your display whenever you want to watch it.”

As home appliances have increased in smartness, cellular and cable connections improved, and pricing declined, O'Donovan believes the desire or ability to monitor and control the home as a holistic platform of devices and appliances has emerged.

“Many IoT applications are triggered by sensors and need data management, but there is no single IoT gateway to the home,” O’Donovan adds.

“As Internet-connected homes become increasingly smarter, the gateway is becoming the “centre” for connecting the different devices and home appliances to make the management of the ecosystem happen.”

For O'Donovan, the home IoT gateway market is expanding rapidly.

The number of smart connected homes is expected to grow from between 100 million and 200 million homes now to between 500 million and 700 million homes by 2020.

The lack of a good business model or the immaturity of home IoT products has not stopped gateway makers from trying to develop the market to grab share in the home IoT opportunity.

Cable companies, Internet companies, alarm companies and mobile phone operating system providers are actively creating platforms and ecosystems in an attempt to break into the market.

Consequently, Gartner predicts that the most successful home gateway provider 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, as consumers will want to exercise their preference in terms of the IoT products they choose.

Multiple home platforms have emerged, designed to capitalise on or create an ecosystem of smart home things that the gateway must connect to.

Some of the platforms are beginning to open up, or at least work with the others to minimise the different number of platforms that the consumer and the gateway must deal with.

Some smart home solutions are even taking advantage of this void and creating hubs that act as a central command system for the smart home devices, using multiple communication protocols to connect to all of the smart devices in the home and communicate to the world through the IoT gateway.

“As the IoT gateway market emerges, Internet Service Providers will be the early winners in the battle for the home gateway, provided they develop solutions or partner with hub manufacturers,” O'Donovan adds.

“The mobile phone providers will gain a smaller part of this market, but ultimately the cellular model will not have enough bandwidth to compete with the ISP solution.

“Longer term, there will need to be an integrated device, whereby the gateway is also the hub, or integrated hub and gateway solutions will be needed.”

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