Smart home interoperability
Smart home: Challenge or opportunity?
Smart home startups have long wrestled with the challenge of interoperability, the ability for smart home applications to work with third party devices such as home assistants, kitchen appliances, and air conditioning units. In general, users expect that smart home products, or any technology for that matter, will all just work with one another, but interoperability has eluded even the most sophisticated smart home efforts such as Nest and Amazon’s Echo.
From the manufacturers’ perspective, building in support for a range of smart home offerings such as the Apple Home Kit, Google Nest, Samsung SmartThings and WeChat is a significant development burden.
To address this, several government supported organizations have been established in an effort to find common cause with regard to interoperability, including the China Intelligent Family Industry Alliance, which is the most progressive and boasts 176 member companies all working on device interoperability.
Of those pursuing cross compatibility of smart home offerings, Telcom companies are perhaps best placed to realize it. For example, China Telecom has established a Smart Home Open Laboratory to work on modified broadband routers that can communicate with household devices. Another major Chinese telco, China Unicom, has partnered with Sigma Designs to launch Z-Wave, a smart home automation solution with a focus on energy conservation. Z-Wave will be using China Unicom broadband service to offer smart home solutions to China Unicom customers.
Another challenge for insurers wishing to leverage smart home technologies is distribution. One interesting approach currently underway in China is Generali’s establishment of a smart home footing through its JV partner, China National Petroleum Corporation (CNPC). Specifically, CNPC is enabling Generali to establish a foothold for home and health insurance based on CNPC’s positioning as China’s largest supplier of natural gas. As every CNPC gas installation requires an annual maintenance by law, Generali is capitalizing on this offline interaction to cross sell home and health insurance through a dedicated mobile app carried by maintenance technicians. More importantly, this offline reach can also pave the way for the installation of connected home devices (including smart water meters and energy optimization devices) giving Generali a crucial offline component necessary to establish an ecosystem.
Realizing the vision of the connected home has proven more elusive than at first imagined. Among the strongest headwinds are interoperability with smart home devices and the distribution of smart home appliances, device types and operating systems appearing on the market. In China, a high population density along the east coast bodes well for smart home use cases, and although energy conservation awareness is low, those pursuing the vision of an interoperable smart home are paving the way for prevention based property insurance coverage.