Entire contents 2015 by ON World. All rights reserved. The information contained herein has been obtained from sources believed to be reliable. ON World takes no responsibility for any inaccuracies, completeness or adequacy of such information. ON World shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The reader assumes sole responsibility for the selection of these materials to achieve its intended results. The opinions expressed herein are subject to change without notice. No part of this report excerpt may be given, lent, resold, or disclosed to non-customers without permission. Reproduction or disclosure in whole or in part to other parties is permitted only with the written and express consent of ON World. This document is a free report excerpt. A full version of the report may be purchased directly from our website for an immediate download. If you need an invoice, please call or email us at: research@onworld.com ON World Inc. Emerald Plaza Center 402 West Broadway Suite 400 San Diego, California 92101 http://www.onworld.com Toll free (U.S.): 888.312.2619 International: 858.259.2397 2015 ON World Inc. All Rights Reserved.
Executive Summary Executive Summary Cloud-based platforms along with plummeting costs for LEDs and low power wireless components have made smart lighting one of the fastest growing Internet of Things markets and a catalyst for smart home innovation and adoption. Sales of smart LED light bulbs increased by 15X over the past two years and products are now available for under $10 from many retail outlets. Tens of millions of households will use smart lighting systems by 2020. ON World s recently completed surveys with 2,000+ U.S. consumers found that 1 in 3 are likely to use smart home solutions within the next three years and over half of these likely adopters are planning to purchase smart wireless LED light bulbs in the next two years. Consumers are demanding interoperability and the ability to combine smart lighting with other smart home solutions such as thermostats, security systems and smoke alarms. Global annual shipments for smart home wireless lighting products will reach 133 million in 2019 up from 6 million in 2014. Figure 1: Global Smart Home Wireless Lighting Product Shipments (2014-2019) 150,000 100,000 50,000 0 2014 2015 2016 2017 2018 2019 Thousands Source: ON World Retail sales of smart wireless lighting continues to accelerate with smart LED light bulbs now outselling other market segments such as switches, dimmers, plugs and sensors. Drivers include rapidly dropping prices for smart LED bulbs, standards for vendor interoperability and seamless integration with smart home platforms including Belkin (WeMo), Connect (Staples), Iris (Lowe s) 2015 ON World Inc. All Rights Reserved. 1
Executive Summary SmartThings (Samsung), Nest (Google), Wink and others. In 2020, there will be over 30 million smart home controllers/hubs shipped worldwide and lighting controls will be used in half up from 27% in 2014. Sales of smart LED light bulbs are on track to triple this year. By 2019, smart bulb sales will dwarf other smart lighting products and make up three quarters of the global shipments at this time. ZigBee has the largest smart lighting market share but Bluetooth LED light bulbs are also showing up in ever increasing numbers and will soon be the second largest smart lighting technology up from 7% of the market share in 2014. Figure 2: Smart LED Light Bulb Sales (2013-2015) xxxxx xxxxx Sales of smart LED light bulbs increased by 15X over the past two years and are on track to triple this year. 0 Thousands 2013 2014 2015 Est. Source: ON World There are over 100 smart LED light bulb products currently available for sale with 3 out of 5 launched/announced in 2014. Retail channels include Apple Stores, Best Buy, Home Depot, Lowe s, Staples and Walmart. Figure 3: Smart LED Light Bulb Products by Launch Date <2014 38% 3 in 5 smart bulb products were launched or announced in 2014 or more recently. >2014 62% n=45/58 Source: ON World 2015 ON World Inc. All Rights Reserved. 2
Executive Summary ON World s April 2015 survey with 1,000 U.S. online adults found that smart LED light bulbs are the most likely smart home product to be purchased over the next two years, planned by over half of likely smart home adopters. Figure 4: Top 3 Smart Home Products Most Likely to Purchase (% of Likely Adopters) 53% 34% Over half of likely smart home adopters will purchase smart LED light bulbs within the next two years. 28% n=394 Smart LED light bulbs Smart thermostat Smart appliance Source: ON World Through smart lighting, ZigBee has found a direct channel into the consumer s home. ZigBee smart lighting products are currently available from most of the major lighting manufacturers and smart home platform providers including Belkin, Control4, GE, Cree, LG, Lutron, Osram Sylvania and Philips. However, the number of Bluetooth smart lighting products is rapidly growing with recent offerings from Elgato, Satechi, Sengled and Misfit and increasing crowd-funded projects. Bluetooth Smart Mesh is ZigBee s biggest threat with pre-standard products launching this year such as Feit Electric s HomeBrite product line. Long term success for smart lighting product will largely be dependent on their ability to be used with a variety of smart home. Another ON World survey with 1,000 U.S. online consumers completed in August 2015 found that 55% would like to integrate smart lighting with at least one other application. Based on vendor surveys and phone interviews with 2,100 individuals across the whole smart lighting value chain along with an evaluation of 260+ products and 20,000 consumer reviews, this report analyzes the rapidly growing market for residential smart lighting. The report provides global 5-year forecasts for equipment and software/services with breakdowns by market channel, product segment, technology and geography. It also includes the key findings from two surveys on smart homes and lighting controls with 2,000+ US consumers as well as phone interviews and another survey with 100+ smart wireless manufacturers, developers, suppliers and distributors. 2015 ON World Inc. All Rights Reserved. 3
Scope & Methodology Report Scope & Methodology This report covers the global market for wireless controls used for smart lighting in residential applications. We include five-year forecasts by device units and revenues for equipment as well as services and include breakdowns by market, product segment, geography and wireless sensor network (WSN) technology (by chipset). Our research methodology consists of the following steps: Primary Research: Interviews/surveys with 2,100 individuals including consumers, home service providers, retail outlets, facility/property managers, professional installers, lighting manufacturers, control system providers, component suppliers and other industry experts. Investigation: Analysis of over 20,000 product reviews for 260+ residential smart wireless lighting products and extensive review of technical and financial reports. Product Segments: Wireless adapters, smart LED light bulbs, sensors, switches/dimmers/plugs, keypads/remotes and controllers/gateways. Target Markets: o Professional Installer o o Retail Managed Services Technology Evaluation: Competing WSN technologies, standards developments, industry alliances and testing on the power consumption and performance of WSN radios, protocols and energy harvesters. WSN technologies analyzed include ZigBee, 802.15.4, 6LoWPAN, Bluetooth Smart, WiFi, Z-Wave, EnOcean and several proprietary variants. Competitive Landscape: Analysis of 40 companies with smart wireless lighting control products and/or services including technologies adopted, target markets, pricing, sales channels and strategic partners. Market Size Projections: Our market size forecasts are based on all of the above that is applied to our proprietary forecasting methodology that has been refined over the past decade (see the report for more details). 2015 ON World Inc. All Rights Reserved. 4
Table of Contents Table of Contents Executive Summary... 1 Report Scope & Methodology... 4 Ecosystem... 5 Trends & Developments... 5 Plummeting LED Lighting Costs... 5 Growing Bluetooth Smart Lighting Products... 5 Widespread Smart Home Adoption... 6 Open Source Software & Cloud-based Platforms... 6 The Value System... 8 Smart Lighting Product Analysis... 9 Smart LED Light Bulbs... 9 Enormous Smart Bulbs Sales Growth... 10 Consumer Product Ratings... 10 ZigBee Leads the Smart Bulb Market... 11 Smart Bulb Products by Technology... 12 Smart Bulb Products by Price... 12 Consumer Views... 14 Primary Smart Home Adoption Driver... 16 Preferred Smart Lighting Integration... 18 Most Likely Smart Home Products... 20 Preferred Smart Lighting Features... 22 Most Important Experience Features... 24 Maximum Smart LED Bulb Pricing... 26 Smart Lighting Service Fee... 28 Percent of Home s Light Bulbs to be Smart... 30 Smart Wireless Lighting Concerns... 32 Technology Dynamics... 34 Trends & Developments... 34 Low Power Chips... 34 6LoWPAN Everywhere... 34 Mesh Networking... 34 Technologies & Standards Developments... 35 IEEE 802.15.4... 36 ZigBee... 36 ZigBee Home Automation... 37 ZigBee Light Link... 37 ZigBee Green Power... 37 ZigBee 3.0... 37 2015 ON World Inc. All Rights Reserved. i
Table of Contents The Thread Group... 38 EnOcean... 39 Z-Wave... 39 Low Power WiFi... 40 Bluetooth Smart... 40 Other Industry Alliances... 41 Connected Lighting Alliance... 41 UPnP+ Initiative... 41 AllSeen Alliance... 41 AllJoyn Service Frameworks... 41 Connected Lighting Project... 42 Open Interconnect Consortium (OIC)... 42 Mozaiq Operations... 42 Market Size Forecasts... 43 Methodology... 43 Units by Channel... 44 Revenues by Channel... 45 Units by Product Type... 46 Revenues by Equipment & Services... 47 Revenues by Geography... 48 Chipsets by Technology... 49 Smart LED Light Bulb Shipments... 50 Smart LED Light Bulb Revenues & Control Costs... 51 Competitive Landscape... 52 Components... 53 Lighting Manufacturers & Smart Bulb Products... 55 Control Systems & Software... 57 List of Figures Figure 1: Global Smart Home Wireless Lighting Product Shipments (2014-2019)... 1 Figure 2: Smart LED Light Bulb Sales (2013-2015)... 2 Figure 3: Smart LED Light Bulb Products by Launch Date... 2 Figure 4: Top 3 Smart Home Products Most Likely to Purchase... 3 Figure 5: Global Smart Home WSN Controllers/Hubs (2014-2020)... 6 Figure 6: Consumer Smart Wireless Lighting Products by Type... 9 Figure 7: Consumer Smart Wireless Lighting Products by Launch Date... 9 Figure 8: Residential Retail Sales Growth by Product Type 2013-2014... 10 Figure 9: Consumer Smart Lighting Ratings by Product Type... 10 Figure 10: Residential Retail Sales Growth by Technology 2013-2014... 11 2015 ON World Inc. All Rights Reserved. ii
Table of Contents Figure 11: Consumer Smart Wireless Lighting Products by Technology... 12 Figure 12: Consumer Smart Wireless Lighting Products by Price... 12 Figure 13: When Likely to Adopt Smart Home Sensing System All... 14 Figure 14: When Likely to Adopt Smart Home Sensing System by Gender... 14 Figure 15: When Likely to Adopt Smart Home Sensing System by Age... 15 Figure 16: When Likely to Adopt Smart Home Sensing System by Income... 15 Figure 17: Primary Reason to Purchase a Smart Home System All... 16 Figure 18: Primary Reason to Purchase a Smart Home System by Gender... 16 Figure 19: Primary Reason to Purchase a Smart Home System by Age... 17 Figure 20: Primary Reason to Purchase a Smart Home System by Income... 17 Figure 21: Preferred Smart Lighting Integrations All... 18 Figure 22: Preferred Smart Lighting Integrations by Gender... 18 Figure 23: Preferred Smart Lighting Integrations by Age... 19 Figure 24: Preferred Smart Lighting Integrations by Income... 19 Figure 25: Smart Home Products Most Likely to Purchase - All... 20 Figure 26: Smart Home Products Most Likely to Purchase by Gender... 20 Figure 27: Smart Home Products Most Likely to Purchase by Age... 21 Figure 28: Smart Home Products Most Likely to Purchase by Income... 21 Figure 29: Preferred Smart Lighting Features - All... 22 Figure 30: Preferred Smart Lighting Features by Gender... 22 Figure 31: Preferred Smart Lighting Features by Age... 23 Figure 32: Preferred Smart Lighting Features by Income... 23 Figure 33: Most Important Experience Features All... 24 Figure 34: Most Important Experience Features by Gender... 24 Figure 35: Most Important Experience Features by Age... 25 Figure 36: Most Important Experience Features by Income... 25 Figure 37: Max Price for Smart LED RGB Light Bulb All... 26 Figure 38: Max Price for Smart LED RGB Light Bulb by Gender... 26 Figure 39: Max Price for Smart LED RGB Light Bulb by Age... 27 Figure 40: Max Price for Smart LED RGB Light Bulb by Income... 27 Figure 41: Amount Willing to Spend on a Monthly Lighting Service Fee - All... 28 Figure 42: Amount Willing to Spend on a Monthly Lighting Service Fee by Gender... 28 Figure 43: Amount Willing to Spend on a Monthly Lighting Service Fee by Age... 29 Figure 44: Amount Willing to Spend on a Monthly Lighting Service Fee by Income... 29 Figure 45: Percent of Home s Light Bulbs to be Smart - All... 30 Figure 46: Percent of Home s Light Bulbs to be Smart by Gender... 30 Figure 47: Percent of Home s Light Bulbs to be Smart by Age... 31 Figure 48: Percent of Home s Light Bulbs to be Smart by Income... 31 Figure 49: Smart Wireless Lighting Concerns All... 32 Figure 50: Smart Wireless Lighting Concerns by Gender... 32 2015 ON World Inc. All Rights Reserved. iii
Table of Contents Figure 51: Smart Wireless Lighting Concerns by Age... 33 Figure 52: Smart Wireless Lighting Concerns by Income... 33 Figure 53: Smart Home Wireless Lighting Unit Shipments (2014-2019)... 44 Figure 54: Smart Home Wireless Lighting Revenues by Channel (2014-2019)... 45 Figure 55: Smart Home Wireless Lighting Units by Product Type (2014-2019)... 46 Figure 56: Smart Home Wireless Lighting Revenues, Equipment & Services (2014-2019)... 47 Figure 57: Smart Home Wireless Lighting Revenues by Geography (2014-2019)... 48 Figure 58: Smart Home Wireless Lighting Chipsets by Technology (2014-2019)... 49 Figure 59: Residential LED Light Bulb Shipments, Smart Bulbs & Other (2014-2019)... 50 Figure 60: Residential Smart LED Light Bulb Revenues, Lamp & Control Unit (2014-2019)... 51 Figure 61: Smart Home Lighting Competitive Landscape... 52 List of Tables Table 1: The Smart Home Lighting Value System... 8 Table 2: Smart LED Light Bulb Products... 13 Table 3: Wireless Smart Lighting Technologies At-A-Glance... 35 Table 4: Smart Home Wireless Lighting Unit Shipments (2014-2019)... 44 Table 5: Smart Home Wireless Lighting Revenues by Channel (2014-2019)... 45 Table 6: Smart Home Wireless Lighting Units by Product Type (2014-2019)... 46 Table 7: Smart Home Wireless Lighting Revenues, Equipment & Services (2014-2019)... 47 Table 8: Smart Home Wireless Lighting Revenues by Geography (2014-2019)... 48 Table 9: Smart Home Wireless Lighting Chipsets by Technology (2014-2019)... 49 Table 10: Residential LED Light Bulb Shipments, Smart Bulbs & Other (2014-2019)... 50 Table 11: Residential Smart LED Light Bulb Revenues, Lamp & Control Unit (2014-2019)... 51 Table 12: Smart Wireless Lighting Components Profiles... 53 Table 13: Lighting Manufacturers Profiles... 55 Table 14: Lighting Control Systems & Software Profiles... 57 2015 ON World Inc. All Rights Reserved. iv
ON World Inc. Emerald Plaza Center 402 West Broadway Suite 400 San Diego, California 92101 http://www.onworld.com Toll free phone (U.S.): 888.312.2619 International callers: 858.259.2397 ON World provides global business intelligence on smart technology markets. Founded in 1996 in the San Francisco Bay Area, ON World is headquartered in San Diego, California. If you have any questions on the report, please call us or send us an email at: research@onworld.com 2015 ON World Inc. All Rights Reserved.