August 29, 2012 – As AT&T undertakes trials of what it hopes will be a game-changing approach to offering connected-home services the stage is set for robust competition among NSPs on this front even as much remains to be determined with regard to where the smart-home paradigm might lead.
AT&T is a year or more behind three major competitors, Comcast, Time Warner Cable and Verizon, which have taken a different approach to bringing such services to market (see July 2011, p. 14 for coverage on Comcast and Verizon rollouts). Whereas Comcast’s Xfinity Home Security, TWC’s IntelligentHome and Verizon’s Monitoring and Home Control services are only available in their fixed access network territories, AT&T’s plan is to go to a national model that allows consumers to interface with service controls via the Internet through their fixed and mobile broadband connections using any combination of service providers they choose.
“The AT&T Digital Life service has the potential to take home monitoring and home security solutions to another level” says Larry Hettick, research director for consumer services at Current Analysis. “I am particularly impressed with its IP-based wireless platform, plans for a nationwide offering and a wide range of devices that can be monitored and viewed from any carrier’s wireless or wireline Internet connection. These consumer-friendly capabilities will help grow this industry.”
Indeed, the stampede appears to be well underway as network service providers across North America realize the time to move is now if they want to get their share of what is variously estimated as an $8-$12.5 billion market for home security, energy management and other services. “We see an anxiety among service providers to jump in out of concern they might miss the boat,” says Cees Links, CEO of GreenPeak Technologies, a supplier of chips mapped to the ZigBee personal access network protocol. “There have been some big announcements, but many others are in the early stages of getting the offering right, so they’ve been hush, hush about it for competitive reasons.”
AT&T, through a new Digital Life Group within AT&T Mobility, is just in the early pre-rollout phase with trials underway in Atlanta and Dallas. The company hasn’t revealed pricing strategies, dates and locations of commercial launches or other key aspects of the service, but what it has said so far makes clear it’s taking a different tack from those of other announced providers.
“We’re planning a unique suite of services, from start to finish, that will give homeowners control of their property and their possessions through an easy-to-navigate user interface,” says Kevin Petersen, senior vice president of Digital Life at AT&T Mobility. “Our focus is on providing our customers with a comprehensive home security and automation solution that offers the best possible customer experience, and uses the most advanced mobile Internet technology on the market to make their lives easier and keep their families and property safer.”
Consumers will be able to control their services through their personal Digital Life management portal interfaces using any Web-enabled device through any carrier, Petersen says. “The service is smart, simple and customer centric, freeing homeowners to do the things they want to do without compromising on the things they need to do to care for family and home,” he comments.
Consumers will have access through AT&T retail stores and other channels to a wide range of devices operating over the Z-Wave platform to connect to the central home controller, including cameras; window/door sensors; smoke, carbon monoxide, motion and glass break sensors; door locks; thermostats, moisture detection and appliance power controls. AT&T’s pitch will be that “checking on the welfare of loved ones, protecting the home from intruders, fire or water damage, unlocking a door for the repairman or changing the temperature setting on the thermostat – and doing it from wherever you happen to be, here or abroad – can be as easy as if you were right at home.”
Along with a strategy envisioning ubiquitous availability, AT&T is supporting features not available with many other NSPs’ connected-home offerings, including professionally monitored security services through AT&T owned and operated 24/7 security monitoring centers. The carrier also says it will employ professionals to install the platform, sensors and other devices.
ZigBee and the Set-Top Box
So far, Z-Wave appears to be the connected-home communications protocol of choice among telcos while cable operators are gravitating to ZigBee. The Netherlands-based GreenPeak, a leading supplier of set-top chipsets that employ ZigBee, has already doubled last year’s chip sales volume thanks to growing demand for ZigBee in set-top boxes, Links says.
“I’d say more than half the cable operators in the U.S. are starting to include ZigBee in the new set-tops and gateways they’re deploying,” Links says. “Literally all the larger set-top makers are now including ZigBee RF in their products.”
Use of ZigBee as an alternative to infrared for set-top remote control applications has emerged as an early driver to establishing the foundation for an RF home network dedicated to smart-home apps, he notes. Comcast, for example, has selected GreenPeak as chip supplier for new hybrid IR/RF remote controls that can work with both the new RF Xfinity set-tops and legacy IR set-tops. The big advantage to the RF remote control is it eliminates line-of-sight restrictions while providing whole-home coverage, allowing subscribers to put their set-tops wherever they want.
In July GreenPeak announced general availability of the GP510, a set-top/gateway-based communication controller chip that supports all the communications between the gateway and devices enabled by ZigBee RF4CE, the IEEE 802.15.4-compliant remote control system standard. Integration of the connected-home capabilities with the gateway will lower costs of service deployment with a communications reach on par with Wi-Fi, Links says.
Links and his colleagues, with backgrounds as developers of the original Wi-Fi standard at AT&T Bell Labs, have applied sophisticated antenna technology to achieve robust but low-cost protection from interference between ZigBee and Wi-Fi links, both of which operate in the 2.4 GHz RF band. The IEEE took pains to ensure there would be no interference between the two protocols, but the GreenPeak chipsets use patented antenna diversity technology to achieve a 100x improvement in interference robustness, thereby avoiding the indoor wave cancellation that might otherwise occur with Wi-Fi running with ZigBee on set-tops, Links explains.
The chipsets also offer maintenance-free lifecycle operability through use of an ultra-low power technique that allows the ZigBee functions to operate on a single coin cell battery for ten years without recharging, Links notes. “We have the best solution available in the market with the best range, the longest battery life and practically insensitive for Wi-Fi interference,” he says.
Demand and Competition
In the near term, in households where ZigBee-equipped media gateways don’t exist, which is to say the vast majority that subscribe to the new connected-home services, these services are supported by standalone units operating on the specifications of ZigBee or the competing Z-Wave protocol or, in some cases both, while employing Wi-Fi to connect the home controllers to broadband modems. The past few weeks have seen a surge in consumer demand for such services, Links says. “It’s moved beyond a few hundred a month here or there,” he says. “We’re seeing take-up rates for these new service packages hitting ten to fifty thousand per month.”
Getting into the connected-home services business, which until recently had been the purview of firms dedicated exclusively to specific applications such as home security, creates major challenges for NSPs, which are underpricing those traditional services by considerable amounts while adding to the range of apps that can be supported through their gateways. A review of consumer Web postings about early service experiences shows that while most appear to be satisfied with their services there have been many instances of unprofessional installations resulting in sometimes near disastrous experiences. Poor customer service follow up and faulty equipment, including thermostats that have been known to turn on furnaces in 90-degree heat, have fueled complaints as well.
But the early rate of success has been sufficient to prompt aggressive expansion of services by the leading providers. Comcast is now offering the Xfinity Home Security service in over 65 percent of its markets with the goal of making it available in all markets by year’s end. In October Verizon said it had expanded the Home Monitoring and Control service to 12 states and Washington, D.C. with many more added this year.
The competition promises to be fierce. While most NSPs are banking on connected-home service revenues to add to the bottom lines as their growth levels off in legacy markets, Verizon has adopted a subscriber-retention strategy aimed at increasing its overall service appeal with a $9.99 monthly rate for the basic home security service. Comcast’s basic service rate is $29.95.