This document discusses the history and current state of the smart home market. It makes the following key points: 1. The smart home market has been slow to develop, despite early experiments in the 1990s. Standards wars and a lack of clear value propositions held the market back for decades. 2. Today's smart home products still have limitations. Smart watches like the Apple Watch have not solved clear problems and underwhelmed users. Smart home gateways are becoming obsolete unless they provide additional capabilities like voice assistants. 3. For the market to grow, future smart home products will need to be seamlessly integrated, secure, learn user behaviors, and update automatically without configuration. They will also face increasing expectations

1. YOUR NEW PRODUCT
IS ALREADY OLD

2. ABOUT RWE
8m in Germany, 4m in theUK, 2m in Holland
Customers
Around 80 peoplein the Innovation Hub
Employees
Operating energy retail or distribution in 11
countries, with generation presencein several
more
Geographies
23m 65k

3. Slow to Start – Impossible to Stop
Product Zero
In 1990,before there were any
web pages, there wasa connected
toaster – followed bymanymore
experiments that didn’t have
commercial applications Is this a Thing?
In 1999,as part of theRFID boom,
the phrase‘Internet of Things’ is
coined for thefirst time
The Standards
Wars (ongoing)
Across domains– energy,
telecoms, manufacturing,wehave
lost at least a decade in
committee considering which
radio or application protocol isthe
most appropriate
Jam Today?
?It now seems there is a market,
there arecustomers and we can
finallystart selling Connected
products

4. Today’s Smart Home Market
It is 26 years since that first connected toaster – why aren’twe all living smarter lives
at home?
We are still attending conferences talking aboutwhen our marketwill materialise….

5. What is Missing?

6. HERO to ZERO
10 years ago, Smart Watches werestill science fiction.
Today, the Apple Watch – easily the most appealing smart watch
to the generalpublic – is regarded as a disappointment by an
informed audience.
Apple have only sold 10m units and mostcustomers are
underwhelmed.
It isn’t magical enough, it is slow and thebattery life isn’t practical
yet - and it is less than 40 years since Space Invaders was a global
phenomenon - butwhatproblem is the Apple Watch trying to
solve?

7. SPY to SAINT
Thetech reviewers aren’t always right– they didn’t think that
consumers would accept a not-so-covertchannel to order morestuff
from Amazon. We’d be concerned aboutsnooping, and wewould feel
awkward talking to a machine….
But it ticks theright boxes;
• natural interface – watch a child use onevs. a smart homeapp
• onestep install to share the WiFi password
• nota onetrick pony – music, jokes, stories, shopping, smarthome
• interoperable – new services and integrations each week
• the clever bit is portable – Alexa isn’t tied down
• plus, it is fun
• other homeassistants are coming – Google, Apple, Sears

8. Today’s PERFECT Smart Home Product
Self Install & Never Touch
Ethernet ports and WiFi passwords are
for geeks – justmake it work. And if it
breaks more than once – in the bin,
we’ll get the newer better cheaper one
‘Magical’ Interface
We want to talk to our tech, or wave at
it. We also want to be Tony Stark and
liberate ourselves from the tyranny of
apps, chimping and batteries that just
die
Unhackable & Private
We don’t make good passwords, we
won’t use 2 factor authentication – just
make it better, or I wouldn’t trust myself
to have it in my home.
Properly ‘Smart’
Radio does not make a fridge smart – it
needs to learn about our homes and
habits. Itshould also update itself with
good new features without me needing
to do anything
Beautiful
Fully Interoperable
Open Source

9. GATEWAY TO
OBSOLESCENCE
Your Smart Homegateway isn’t cutting it anymore. Unless you’rea
speaker and virtual assistant, or streaming 4K content or enabling
massively multiplayer gaming – you’rea waste of an Ethernet socket and
frankly, energy to make and operate.
Pretty or functional, costly or cheap, the first generation ofsmart home
gateways have had their day.
This domain is already transforming into the service layer it should have
been from the start – embedded into other devices that have more
permission to exist in the home.

10. The Enemies Are At The Gate
Natural Interfaces
‘Magic’ Radios
Blockchain
AI
Theemergence ofthe Internet ofThings and the
Connected Homemeans they arenow genuine
opportunity spaces whereclever technologies can
find useful applications.
Customer expectation is now that technology is
child’s play, does magical things and is practically
disposable.
How slow, clunky and generally underwhelming
does any 5 year old piece of tech in your homefeel
today?
Today’s cutting edgeis next week’s dullblade – the
unwritten covenant in technology purchasing, but
customers expect today’s products to keep up at
least.

11. MAGIC RADIOS
For pennies a month, with a battery life matching
productlife, you can now havesimple connected
sensors that don’tneed a gateway or signal
boosters. Sigfox smart homegateways are
already available.
Sigfox and LoRa networks arehereand will
connect everything that doesn’tneed lots of
bandwidth – but they will generate enormous
amounts of data from
• Metering (heat, water, energy)
• Presence sensing
• Appliance monitoring
• Leak detection
• State detection or changes
Data = value = opportunity

12. INTELLIGENT VALUE CREATION
Theexplosion ofdata doesn’thave to go to an
enterprise cloud to become valuable.
Smart Contracts built on theblockchain can create
value transactions within a smart homethat
generate revenue;
• Demand response
• Frequency response
• Intelligent generation/storage optimisation
• Pay As You Go appliance models
• Remote boiler monitoring can becomea remote
service model whereplumbers bid for remedial
work on an open ledger platform
These usecases are being built as we speak – how
can wesell a productor servicewhen customers
could use a self-financing oneoperating for their
benefit on an open platform powered by choice?

13. The New Normal
Unlocking Value in Data
AI and the smart contractson open ledgers
will allow for businessmodels that drive
exponential adoption
Stateless Interfaces
Not just on a phone, not just on theweb,
not just voice - thiscan be on the TV,it can
be in your bathroom mirror,it can react to
the preference of theindividual user and
the service being delivered
Transparent Interoperability
IFTTT istoo hard for 90% of the population,it has
to be easier – productshave to be open or
customers will stayaway
Unconstrained Radio
Connecting manysensors and switches,
generating data and enabling services to
support therest of the stack

14. EVERYTHING HAS TO BE HEROIC
• Self driving cars
• Robot vacuums
• 700mph trains
• Hitch hikers guide in your pocket
• All the music, ever, on demand
• Real time pizza delivery tracking
Technology is accelerating customer
expectations – even humble
products need to step up, especially
those that want to be part of the
future
We don’t have hoverboards, flying
cars or cryogenic immortality – yet –
but that’s what we want instead of
marginally better lightbulbs
Smart Home products HAVE to try
and be heroes too

15. THANK YOU
+44 7572 81709 simon.harrison@rwe.com simon.harrison@raygun-consulting.com @raygunsimon
SIMON HARRISON
Head of InnovationTechnology – RWE Innovation HubUK Outpost
(until1st July 2016!)