Iot Smart Homes Market

The Market For Iot Smart Homes has experienced significant growth and is projected to continue expanding. In 2021, the market size was valued at USD 79.31 billion, and it is expected to reach USD 603.79 billion by 2030, growing at a CAGR of 25.3% during the forecast period of 2023-2030.

Several factors are expected to drive the market potential. Firstly, the increasing number of internet users globally is contributing to the growth of IoT smart homes. As more individuals gain access to the internet, the demand for smart home technologies and solutions rises. Additionally, the rising disposable income of consumers in developing economies enables them to invest in smart home devices and systems. There is also a growing need for home monitoring in remote areas, leading to increased adoption of IoT smart home solutions. Furthermore, the demand for energy-saving and low-carbon emission solutions is fueling the market growth as consumers seek environmentally friendly alternatives.

The widespread use of the internet has transformed various industries, including home automation, banking, transportation, healthcare, retail, education, and personal data analysis. This increased reliance on the internet has been facilitated by the proliferation of mobile devices. The availability of digital assistants and AI-powered technologies has made smart devices more convenient and user-friendly. Digital assistants like Alexa, Google Assistant, Siri, and Bixby enable hands-free control of smart devices through voice commands, enhancing the overall user experience. Customization of smart home devices is also preferred by consumers, as it offers greater convenience and personalization.

The rapid adoption of modern technologies such as IoT, blockchain, smart speech recognition, and AI has significantly influenced the expansion of the smart homes market. These technologies enable voice recognition by smart home devices, allowing for personalized responses. The increasing use of IoT in both developing and developed nations has further contributed to the market's growth. The ability of technology to connect devices has driven the demand for smart home solutions.

The global IoT smart homes market is segmented based on product, protocols, application, and region. The product segment includes security and access controls, lighting control, entertainment devices, HVAC, smart kitchen appliances, home appliances, smart furniture, home healthcare, and other devices. The protocols segment is categorized into wireless protocols, wired protocols, and hybrid. The application segment comprises new construction and retrofit. Geographically, the market is segmented into North America, Europe, Asia Pacific, the Middle East and Africa, and Latin America.

Analysis by Protocols

The wireless protocols segment in the global IoT smart homes market is projected to experience the highest compound annual growth rate (CAGR). This segment also held the largest market share in 2021. The growth can be attributed to the advanced capabilities and features offered by wireless protocols such as ZigBee, Wi-Fi, Bluetooth, Z-Wave, and others. These protocols enable mobile connectivity and seamless connectivity regardless of location, driving their widespread adoption. Manufacturers prefer protocols that facilitate easy communication, consume less battery power, and provide a wide range of connectivity options. For example, the ZigBee protocol offers longer battery life by utilizing low-duty cycle operation and enables low-latency device-to-device communication. On the other hand, the wired protocols market is expected to grow at a CAGR of over 25%, primarily driven by traditional devices with built-in Ethernet or cable connections. Wired protocols are commonly used for central hub control and interconnection of smart home devices. Key trends in the wired protocols market include ensuring the safety of wires installed behind walls and addressing connectivity concerns. The market for wired protocols is expected to witness growth due to the increasing demand for low-latency smart home technologies.

In terms of application, the new construction category is anticipated to grow at the highest CAGR during the forecast period from 2022 to 2030. This growth is driven by the convenience and ease of integrating smart home devices during construction activities. Homeowners prefer installing smart home products without the need to demolish walls or tiles, ensuring safe and efficient installation. The rise in new residential buildings globally also contributes to the demand for smart homes, especially those equipped with advanced security and access features. Additionally, the retrofit market segment held the largest market share in 2021, driven by the increasing demand for smart homes among existing homeowners. Depending on logistics and budget, current homeowners retrofit their homes by installing one or more smart devices. The growing availability of smart devices in the market fuels the growth of the retrofit segment.

In terms of regional insights, North America is expected to dominate the IoT smart homes market throughout the forecast period. The region's market is driven by the increasing demand for reliable and affordable home management systems, including advanced security systems, improved device standards, and integrated smart devices like tablets, voice assistants, and IoT-enabled devices. North America has a higher number of homes equipped with these systems and appliances compared to other regions, contributing to higher revenue for product and software providers.

The Asia Pacific region is expected to witness a CAGR of over 30% during the forecast period. The market expansion in this region is attributed to the rising standard of living, increasing disposable income, and rapid adoption of smartphones, the internet, and other technologically advanced devices. The use of AI-based digital assistants like Siri and Alexa for daily tasks also has a significant impact on the growth of the smart homes market in the Asia Pacific region.

Global IOT Smart Homes Market Dynamics
Drivers

Internet of Things (IoT) Solution Adoption to Boost Market Expansion

The loT platform is a significant driver for the expansion of the smart home industry on a global scale. The adoption of loT-based technology in homes enables energy-saving capabilities, and it is projected that by 2025, there will be over 25 billion Internet of Things connections worldwide, indicating a rapid growth in the number of connected devices. This growth in loT connections, facilitated by advanced technologies like 5G, is expected to fuel the expansion of the smart home market in the coming years.

The increasing demand for energy-saving and low-emission solutions is another key driver of the global smart homes market. Energy efficiency has become an important consideration for economic prosperity, driven by regulatory requirements and concerns about global warming. Smart homes play a significant role in reducing energy consumption, and this aspect is anticipated to be a major driver for market expansion.

However, one of the main challenges that may restrict the market is the high security concerns associated with smart home technology. The growing prevalence of cyberattacks on connected devices poses a risk to the security of smart homes. As intelligent technology connects various systems and devices within the home, inadequate security measures can make them vulnerable to hackers. Reports suggest that a significant portion of loT devices, around 80%, are susceptible to various attacks, highlighting the need for enhanced security measures in the smart home industry.

In terms of the competitive landscape, the dynamics of the industry and the strategies of key corporations and new entrants play a crucial role in shaping the global market. Companies undertake growth initiatives such as product launches, mergers and acquisitions, technological advancements, and geographical expansion to stay competitive. For instance, Amazon.com, Inc. announced the release of its smart home products, including sound bots, wall echoes, and house robots, as part of its annual model refresh in August 2022. This move reflects the company's efforts to enhance its product offerings and compete with other businesses in the market.

Top Player’s Company Profiles

• Amazon.com, Inc.
• Alphabet Inc. (Google)
• Samsung Electronics Co., Ltd.
• Apple Inc.
• LG Electronics Inc.
• Honeywell International Inc.
• Siemens AG
• Schneider Electric SE
• Robert Bosch GmbH
• Johnson Controls International plc
• Lutron Electronics Co., Inc.
• United Technologies Corporation
• Legrand S.A.
• Ingersoll-Rand plc
• Leviton Manufacturing Co., Inc.
• Control4 Corporation
• Alarm.com Holdings, Inc.
• August Home, Inc.
• Nest Labs, Inc.
• SmartThings Inc.

Recent Developments

In January 2022, Samsung Electronics Co., Ltd. entered into a partnership with the Home Connectivity Alliance, aiming to drive the growth of smart home technologies. Through this collaboration, the companies will enhance their product lineup by adding new and useful features. Market participants are also expanding the capabilities of smart home products and features to promote their adoption in both new construction and retrofit projects.

ABB India introduced a new switch line in 2022, featuring switches from Millenium and Zenit that have received ISI certification. These switches offer customers comfort, functionality, and control in smart buildings and spaces. They can be easily upgraded with the latest smart home automation systems, providing customers with an intelligent and eco-friendly alternative for conventional lighting in both residential and commercial establishments.

In the global IoT smart homes market, there is a growing demand for electrical cooling systems during summers and various heating systems (natural gas, heating oil, wood, and electrical) during winters due to the variability of climatic changes. The utilization of HVAC systems is expected to increase with the implementation of new government requirements on efficiency. This drives the adoption of smart HVAC control systems in buildings, enabling energy efficiency adjustments in compliance with government guidelines. Retrofitting of HVAC equipment may be necessary to meet these requirements, contributing to the overall market growth. Proper ventilation, including humidity control, is crucial for creating a healthier indoor environment. Maintaining a relative humidity of 40% to 60% inside buildings can help reduce the risk of virus transmission. Integrating makeup air into the HVAC system improves ventilation and promotes a healthier atmosphere. Commercial HVAC systems often use filters measured in MERV (minimum efficiency reporting values) to ensure filtration efficiency.

IOT Smart Homes Market Segmentation

By Product

• Security & Access Controls
• Lighting Control
• Entertainment Devices
• HVAC
• Smart Kitchen Appliances
• Home Appliances
• Smart Furniture
• Home Healthcare
• Other Devices

By Protocols

• Wireless Protocols
• Wired Protocols
• Hybrid

By Application

• New Construction
• Retrofit