The Australian IoT in the Home Market Presented at The Connected Home Conference Sydney 24 Aug 2016

The Mega Trends universe that we track Source: Frost & Sullivan

It is not just about the home! Social Networking Digital Identity Management (Biometrics) Calendar and Event Planning Media and Entertainment Location- Based Services Transportation: Mobility Apps, Journey Planning, Real-time Information, Automatic Fare Collection Bring Your Own Device Shopping & eRetail Mobile email eGovernance Car and Bike Rental and Leasing Banking and Financial Services eEducation NFC and Mobile Payments Unified Messaging Enterprise Mobile Apps Healthcare at Home (Remote Monitoring) Telepresence Car eRetailing Home Security CITY Apps for Car Wash, Valet Service WORK Computing and Connected Devices Telematics Home Automation Digital Consumer Ecosystem Parking Apps Energy Management Home Entertainment HOME Usage-based Insurance CAR The next generation of solutions for connected living will be driven by the convergence of technology and suppliers across homes, cities, work, and cars. Source: Frost & Sullivan

What will a smart home look like? Source: Frost & Sullivan

Australian Consumer Interest in IoT in the Home Solutions 25.8% 25.6% 48.6% Interested and aware of benefits of IoT in the Home solutions Unaware of benefits of IoT in the Home solutions Not interested in IoT in the Home solutions Source: Frost & Sullivan

Australian Consumer Preference for Solutions Australian Consumer Interest in DIY Smart Home Solutions Source: Frost & Sullivan

Australian Consumer Ranking of IoT in the Home Security Applications Source: Frost & Sullivan

72.1% 27.9% Lighting, HVAC and power socket control Australian Consumer Ranking of Smart Home Energy Management Applications Lighting, HVAC and power socket control 72.1% Display power consumption of electrical devices 27.9% Source: Frost & Sullivan

Australian Consumer Preference for Installation of Smart Home Solutions Source: Frost & Sullivan

Australian IoT in the Home – Other Demand Trends Only 25% of consumers are aware of IoT in the Home Wireless Communication Protocols. Communication Of consumers that are aware of communication protocols used in smart home solutions, two-thirds prefer Wi-Fi. High initial cost (84%) and high maintenance and management costs (72%) are the two biggest concerns for consumers. Concerns TEXT Consumer investment preference for smart appliance highest for washing machine, refrigerator, dishwasher and oven. Smart Appliances Source: Frost & Sullivan

Growth in the Australian IoT in the Home Solutions Market Source: Frost & Sullivan

So how is the industry responding? Jan 2015: Google partners with Insteon to boost the range of compatible products Nest can connect with and enable Nest to be controlled through an Insteon hub. Feb 2014: Google acquires 100% of Nest labs Inc. for $3.2 billion. Aug 2014: Samsung acquires SmartThings for about $200 million. Jan 2016: Samsung announces SmartThings compatibility with Smart TVs. Oct 2015: Legrand announces it will partner with Google Nest and use its weave protocol for its products. Nov 2014: Amazon launches Amazon Echo. 2014 2015 2016 Nov 2015: Intel launches a new IoT platform, Intel Quark and the Tiny House to demonstrate its smart offering Jul 2014: Open Interconnect Consortium is formed. June 14 and Oct 14: Google Nest acquires Dropcam (cameras) and Revolv (smart hub hardware). Jan 2016: SmartThings announces a formal partnership with BMW. Jun 2014: Microsoft partners with Insteon (leading home automation protocol participant). Source: Frost & Sullivan

What business models will emerge? IoT and Smart Buildings Value Chain, 2016 New Business Models, 2016 Bundled Service Model Bilateral Service Model Single Product Approach Model BEMS, home automation, lighting control, thermostats, IP cameras, smart switches and plugs, etc. A System/Device Suppliers Technology/ Platform Providers Cloud networking, Big Data Analytics, OS, ZigBee, Wi-Fi, IGRS, KNX, Modbus B Cable operators, communication providers C Network Providers BEMS: Building Energy Management Systems IGRS: Intelligent Grouping and Resource Sharing OS: Operating System Source: Frost & Sullivan

What business models will emerge? Sales of Smart Data Freemium Subscription Pay-as-you-use Pay-for-results Transaction fee from the use of the platform Product as a service One-time fee Source: Frost & Sullivan

Who will realise the opportunities? Connected Homes Market: Opportunities by Solution Provider Group, 2016 Solution Provider Impact Opportunities in Connected Living in the Future Telecom Operators Solutions such as shared data plans, split billing, and reprogrammable SIMs could lead to significantly more attractive pricing models, as data sales would be restricted. Partnering with OEMs and service providers will be key. Mobile Network Operators Key participants are amongst the most influential in the integration of connected products and services as the mobile and tablet is the central consumer use platform. Utilities Key participant group in home energy management through remote control devices and provision of data on energy consumption; will enable better understanding of billing through customer connections but slow to diversify Software Providers Key ability to commercialize connected applications and services, and make solutions more scalable and easily upgradable Original Equipment Manufacturers Track record in successful partnerships with service providers, and ability to offer converged products and smart innovations across multiple distribution channels Application Developers A decoupling of apps from phones may eventually become a reality as more content and services are shifted to being hosted on the cloud rather than on native apps. Stable Increasing Source: Frost & Sullivan

Critical Success Factors Customer Engagement Beyond low-hanging fruit Leveraging Convergence

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