Earlier this year I had the pleasure of attending the Consumer Electronic Show (CES). I’ve been three times, and while I get better each year at being a smart attendee, I never manage to pull it off to my full potential. No one can. It’s an understatement to say that it’s overwhelming. The numbers for 2019 are coming in Spring, but 2018 had 4,400 exhibiting companies and exhibit space of more than 2.7 million net square feet. It JUST GETS BIGGER each year. And I fortunately get smarter about how I experience it. I do my research well in advance and plan my itinerary.  You need to do the prep work. What I’ve discovered is that my favorite part are the days just before it opens, attending courses and panels discussions until I reach well beyond the point of brain overload.

Three colleagues attended with me this year and we experienced it three different ways. What was important to us however, was to share what we learned when we got back to Toronto. We figured that since not every body has the same opportunity to go to CES, we’ll bring CES to them. And that also allows me to start a contrarian slogan that “What happens in Vegas doesn’t always stay in Vegas.”

To keep my learning about the smart home piece as concise as possible, I summarized everything I soaked in into three simple themes.

  1. FRICTION FREE
  • Most of the smart home products are intended to add convenience to people’s lives –adding efficiency to what we already do – not really delivering new processes – just better processes – The typical ones that you’re familiar with are keyless locks, parcel delivery and enhanced security
  • In order for new tech to be adopted, there’s a clear correlation with simplicity. They have to be extremely simple to use . If they’re not easy, not intuitive , they’re not going to be adopted. That seems to be the main criteria for success.

A great example of this is voice –

  • There was some research presented at CES by a company called GFK who does 25K in home consumer interviews annually on product-related topics
  • They talked about how voice has gotten such rapid adoption, because of its simplicity, regardless of age.
  • 20% adults are estimated to have smart speakers
  • The # of smart speakers in the home has increased 78% in one year – it’s extremely rapid adoption – Faster than cell phones actually.
  • Smart speakers are primarily purchased for audio—typically used for music, news, list management etc, but we’re seeing a secondary application as it encourages adoption of other devices that serve smart home functionality – The common ones are light bulbs, doorbells, thermostats, security cameras etc.
  • It’s reported that there are more voice activated devices than humans now.
  • The smart home arena is also therefore growing at an extremely fast pace
  • Its estimated that ½ of Americans have at least one smart product/device in their home

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The primary uses of smart home devices are:

  • Optical energy use, better security and more interaction between smart appliances. A great example of this I loved at the show was Whirlpool’s acquisition of Yummly to create a set it and forget it philosophy in the kitchen to make cooking easier. We’re getting to a point where we’ll have recognition of what’s in your fridge, recipe creation and then a stove that’s smart enough to take you through it without messing it up.

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  1. WE’RE STILL IN OUR INFANCY
  •  The Smart Home industry is still early on its journey and there’s the pressure of keeping up with consumer demands. There’s still a gap for the most part between where we are and what the expectation is.
  • It’s not unlike other industries. The number one thing people look for in their car, after safety of course – is its smart features – it’s the same for housing – but all of these rely on connectivity.
  • Ironically, in a vertical environment with tons of concrete, delivering good cell coverage and Wi-Fi is challenging. But it’s the number one amenity. So it’s something that we have to invest in with things such as DAS systems (distributed antenna systems) in our buildings that make it more reliable. We’ve even started delivering unlimited high-speed internet as a utility.
  • My prediction is that it won’t be too long before there’s a WIRED SCORE in residential buildings in Toronto and other cities. It’s something we’ll be ready for. It’s clearly something your customers will be looking at in their decision-making process.
  • The other aspect of the smart home industry being in its infancy was seen by people having a similar challenge and objective in figuring out the integration between of all of these varied smart devices in our homes. Again – back to simplicity – people want an easy, seamless and integrated experience (not a choppy one), and certainly don’t want to go into five different apps to operate their home.
  1. NICE TO HAVE vs. NEED to HAVE
  • I noticed a shift at CES this year in the perception of what really defines a SMART home. It’s evolving from the ease and convenience of what’s nice to have – into more of a NEED to have.  For example – in addition to a smart home delivering more convenience in everyday operation of your home, like automated lighting and blinds, it will transition to more proactive monitoring and maintenance of your home —this will involve things like diagnosis and self solving to minimize down time and prevent failure.
  • An easy example is a focus on air quality which at a minimum, is five times more polluted than outdoor air. But it’s still everybody’s best guess as to when to change their air filters.
  • There’s also the example of our homes being sensory hubs – and if you think in the case of seniors for example – sensors can measure activity, which is a key indicator of health.
  • This is an area we’re keen to focus on in terms of demonstrating our approach to a “solve not sell” philosophy with our consumers. People don’t want to be “sold” to anymore. We will look for ways to solve everyday problems in people’s homes and add value.
  • Another aspect of a “need to have” approach is detection.

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  • Walmart shared a great example. By asking all suppliers to go on block chain, they were able to trace back produce to precise farms in the event of contamination – they were able to do this it in 2.2 seconds. It used to take them one week. The advantage of us having that capability in a homebuilding environment is so valuable – whether it’s a poorly manufactured component of a home that requires proactive replacement or a recall. It will lead to a far more efficient process, and as in the example above, potentially even save lives.
  • Another example is seniors – with activity being the number one indicator of well being – sensors and the data they will generate will be important in allowing people to age in place as we assess health in real time. This is where the trust factor will come in and the value add.

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WHAT WASN’T TALKED ABOUT.

The one thing that seemed to be talked “around” at CES was privacy and data, whether intentionally or not. There’s clearly still a lot of learning to do. The one critical takeaway for me at the Smart City Summit is that it’s going to be a team sport.

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In our environment for example, with IoT and the addition of smart devices, we now have a shared responsibility to deliver a secure place to call home. We used to be (somewhat) consider ourselves mostly responsible for that job. But we’re now well beyond the bricks and mortar. Some people see builders as tech companies and some even go so far as to call them innovation companies. There are thin lines. One panelist made a great analogy of smart devices and the access points they introduce to your home being similar to adding dozens of new windows to your home over a short period of time. Some of the windows might not have locks and some might even be missing glass.

With cyber attacks on the rise, it’s a serious area of concern. It’s going to be a lot of work to figure out the answer. And it’s going to take a lot of people. It will take what I like to call “collaboration as innovation”  with government, manufacturers of the devices and many other stakeholders.  It will also take time and patience. But it’s worth it. Because we need to ensure that what we deliver at the end of the day is never compromised, in any way.

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