MOOREVILLE, N.C. — As Lowe’s completes the rollout of its new cloud-connected wireless control system, competition continues to ratchet up for attracting cost-conscious homeowners with self-installed security, automation and energy management product suites.
Lowe’s new entrant, Iris, provides consumers the ability to remotely control and monitor systems such as thermostats, door locks, power consumption, cameras and motion sensors via Web-enabled computers and mobile devices. The home improvement giant first began selling the system earlier this year and set its sights on completing a nationwide rollout in 500 stores by the end of August. The product is also available online.
“We have the perfect storm — cloud computing, broadband and smartphones are ubiquitous, connected devices are becoming simple and affordable, and customers are looking for greater connectivity and control of their home,” says Kevin Meagher, Lowe’s vice president of smart home. “We also understood there was a gap in the marketplace and we could provide something different. We believe existing security and home automation solutions are expensive and offer limited value, which is why despite many years of heavy investment, they have failed to really appeal to the mass consumer.”
Lowe’s is working with vendors to support the widest possible range of devices with a goal to one day connect everything in their stores to Iris, Meagher says. To that end, the platform was designed to accommodate ZigBee, Z-Wave and Wi-Fi wireless standards.
Iris is available in three different starter kits. The security kit and home control offerings are each $179; the smart kit bundles both security and control feature sets for $299. The basic level of self-monitoring service is free and includes text alerts when alarms are triggered; remote control of connected devices, thermostats and locks; and access to remote video streaming from cameras. A premium monthly service for $9.99, with no contract obligation, provides additional messaging for home events and allows customers to schedule device activation on varying schedules.
Early in Market Penetration
Iris is the latest in a string of smart-home systems that have come out recently from non-security players, including entrants by Time Warner, Verizon, Comcast and AT&T. While some of these offerings include professional installation, still others go to market as do-it-yourself systems. The market penetration for mainstream home automation services, DIY or not, is still in its very early stages, says Chris Johnson, president and founder of St. Mary’s, Kan.-based SafeMart, a provider of self-installed wireless alarm, automation and monitoring services for residential and commercial customers.
“There is tremendous upside potential if we can respond to the evolving demands of today’s consumer. Services that offer only a wow factor will not be sustainable. Those that offer wow and real value will stick, like energy management that actually lowers your bills,” he says. “However, the exposure needs to be driven on a larger scale. This is where some of the new entrants into this space are a double-edged sword. They will create chaos, but at the same time expand the market and demand.”
In the end, home automation services deliver a huge amount of value and should be a boost for the entire industry, Johnson says. “As basic services are more commoditized, RMR levels per customer will go down. That’s where home automation can help support RMR levels, by delivering more value.”
The penetration of professionally installed security systems in the U.S. is said to be in the 20%-25% range, leaving a large majority of the potential home security market untapped. Given the increasing array of DIY options, technological advances and consumer desire to stay connected to their homes, traditional security dealers will be wise to diversify their portfolios, says George DeMarco, a 30-year industry veteran who chairs the Electronic Security Expo (ESX).
“Not everybody out there is going to choose a professionally installed system, especially professional monitoring. There are a lot of people who are comfortable with installing a system but also comfortable with managing their home through apps,” DeMarco says. “For the next generations coming up, it will be a walk in the park for them. The market is big enough to handle both professionally installed systems as well as DIY. There is a lot of money to be made in both areas.”
DeMarco’s message is even if it’s not professionally monitored, traditional dealers can still generate some sort of recurring revenue from a DIY system.
“If I want to use remote applications such as viewing from my smartphone or remotely activating-deactivating the system, then there is going to be [RMR] associated with that even if it is self-monitored,” he says. “Think of it as a faucet. The more information that comes out of it, the more you charge for it. If they want less, then you charge less but you are still going to get money.”