In case you haven’t heard, the Internet of Things is the latest thing.
The IoT movement, where manufacturers take formerly offline devices and update them with Internet capabilities, will encompass 20 to 30 billion gadgets by 2020, according to a 2014 report by McKinsey & Company. Data from CB Insights show that funding to IoT startups eclipsed $1.9 billion in 2014, a 158 percent increase from the amount invested in 2010.
Over the past several years, companies have introduced modified products that could make up the electronically cohesive home of the future: lights, security systems, and, of course, thermostats.
But some key questions regarding the IoT ecosystem remain unanswered. Which company or companies will have the most success linking these devices together? Will machines communicate directly with each other, or indirectly via a hub-and-spoke model? And will it be manufacturers who decide which integrations make the most sense, or the users themselves?
Tim Nott, co-founder of MobileIgniter, a Madison, WI-based startup that helps clients make and market prototypes for connected devices, says it’s still probably too early to tell.
“Nobody has deep penetration into the market yet,” Nott says. “I’d love to just pick a winner, but I don’t think it’s as simple as that.”
One way to illustrate some of the options for tying IoT gizmos together is by looking through the lens of a single business. Let’s use Ring, a Santa Monica, CA-based startup that sells a sensor-equipped connected doorbell. When a visitor rings the bell, residents receive a smartphone alert and, if they choose, can see and talk to the person at the door using the accompanying Ring app.
If users want to be able to let in a guest remotely—say, from the back yard—one way to do so is through direct app-to-app integration. From within the Ring app, one taps a button to jump into a lock app, and unlocks the door from there. According to its website, Ring is currently compatible with certain locks made by Kwikset and Lockstate.
Suppose, though, that a homeowner has already installed a smart lock from Schlage or another manufacturer, then purchases a Ring doorbell. In that situation, someone could use an IoT “hub” to access both devices from a single app. Hubs also allow residents to program smart devices to take cues from each other. For example, if the doorbell’s sensors detect movement, a hub can automatically turn on porch lights.
Ring CEO James Siminoff says the company is working to make its doorbell compatible with two hub brands: Wink and SmartThings, which Samsung acquired in 2014. Among their competitors are Iris and Nest, a subsidiary of Alphabet (NASDAQ: [[ticker:GOOGL]]). Nest is unique in that it is both an IoT device and a hub.
Siminoff says Ring felt that its doorbell should be interoperable with hubs and other connected devices. However, he says, creating an elegant, user-friendly product was more important to the company than trying to address every potential integration scenario.
“I’m not necessarily sure that everything has to be interconnected to the point where X happens on this [app] and Y then happens here,” Siminoff says. “Some of these things are technology looking for use cases. From our side, we don’t spend a lot of time thinking about it in that way.”
MobileIgniter’s Nott says the companies that have introduced hubs have an incentive to encourage manufacturers of new IoT devices to make them compatible only with certain hubs. However, he says, the competition is unlikely to result in a “walled garden” scenario where a machine only works with one type of hub.
“They’re not saying, ‘Make it work with us, and nobody else,’” Nott says. “What they might say is, ‘Make it work with us first because we already have this market penetration. We’re already on the shelves at Home Depot.’” Wink is being sold at the home improvement franchise.
The race to bridge the gap between connected devices and the connected home has been
