Smart Thermostat Market Analysis By Technology (Wi-Fi, ZigBee) And Segment Forecasts To 2022

Published: February 2016 | Report Code: 978-1-68038-513-7 | Report Format: Electronic (PDF)

Industry Insights

The global smart thermostat market size is expected to exceed 40 million units by 2022. These are electronic devices that regulate the operation of heating and cooling devices in residential or commercial applications. They constitute the next generation of home automation devices that form a significant part of smart homes. Back-up of data in the cloud, managing data and applying analytics to improve performance and achieve self-learning are expected to drive smart thermostat market size.

Proliferation of smartphones acts as enabler towards energy management solutions. The provision of open source developer APIs enhances usability and performance of these devices. The global thermostat industry has gained traction over the past few years owing to increased deployments in residential sectors in North American and European regions. Ease of use and improved energy management offered by such devices has favorably impacted growth. Rise in average energy expenditure the and need for remote access is also estimated to spur demand.

Data security concerns the and high cost of devices may restrain smart thermostat market growth. Reduction in energy bill costs and improved return on investments offered by such devices has considerably increased their demand in households. Furthermore, business and industries have also adopted the technology as a low-cost way to manage their HVAC systems.

These devices are capable of identifying user behavior, analyzing patterns and adjusting the HVAC systems automatically, and offer remote monitoring via wireless connectivity. The Google Nest is one such example of a self-learning device that analyzes user activity by means of motion and Infrared (IR) sensors, humidity and temperature sensors. Such devices are capable of programming themselves and therefore users do not have to program the device daily. Demand for the technology will be supplemented by growing popularity of smart homes and ubiquity of wireless connectivity.

Technology Insights

Key technology segments include Wi-Fi, ZigBee, and other technologies such as Power Line Communication (PLC), NFC, Ethernet and Bluetooth. They enable these devices to connect to the internet and offer analytics and performance measurement tools through web portals.

PLC technology enables sending data over existing power cables, and is adopted as means of communication interface when the data network infrastructure is not well developed Programmable devices that do not feature wireless connectivity modules are packed pre-programmed processors that manage the device.

Regional Insights

North America smart thermostat market is expected to dominate the global industry, due to increasing demand for energy efficiency and presence of key vendors in the region. Booming home automation devices market in Asia Pacific is expected to positively impact regional penetration.

The European smart thermostat industry is expected to gain traction over the forecast period, led by favorable government initiates in the region. For instance, the Department of Energy & Climate Change in the UK introduces the Energy Company Obligation (ECO) in January 2013 by to reduce Britain’s energy consumption and support people with lack of fuel by funding improvements for households towards energy efficiency.

Competitive Insights

Notable manufacturers including Honeywell, Google Nest and Ecobee accounted for over 40% of the global smart thermostat market share in 2014. Honeywell enjoys a strong position in the industry owing to its broad portfolio of products; however the company is facing intense completion from start-ups such as Nest Labs and Ecobee that have gained popularity by offering innovative products.

Other key participants include Schneider Electric, Emerson Climate Technologies, Radio Thermostat Company of America, Carrier Corporation, Ingersoll-Rand (Trane), Allure Energy Inc., Tado GmbH, Eneco, British Gas Hive, and Lux Products Corporation.

Increasing collaborations and partnerships with utilities and energy agencies and technology giants have driven the scope for this industry. For example, SDG&E is working with and EnergyHub to offer products at an aggressive pricing option as a part of its peak rebate program.

In order to sustain share and ensure future growth, companies must rely on their ability to identify and exploit emerging technological trends, while developing and maintaining competitive products. Industry participants can enhance their product offering by incorporating innovative features that enable differentiation while preventing commoditization of products.

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