Building value and trust into the connected home
By Sanjay Khatri, Head of IoT Platform Product Marketing, Cisco IoT
Most of us today are familiar with the concept of the smart home. Even if we are not yet one of the lucky ones already benefitting from products such as intelligent lighting, heating and security, which can be remotely controlled from a mobile, we are likely to be aware that such convenience and efficiency exists and might be hoping to install something similar soon.
Smart home potential
Smart home devices and apps are part of the Internet of Things (IoT), which is growing at an exponential rate. Estimates by the business analyst firm, Gartner, put the number of connected devices in use in 2017 at 8.4 billion with a prediction that this will reach 20.4 billion by 2020. Many of these connected devices will be in our homes as developers, manufacturers and IoT service providers look to capitalize on how connectivity makes our lives easier as well as more comfortable and convenient.
Services are king
These stats are impressive but although the number of connected devices is important for critical mass and to enable the development of all the possibilities for IoT, it is not the determining factor in the long-term success of IoT, or the smart home.
The enduring success of IoT depends on the perceived value that is derived from the services delivered by all those connected devices. The ultimate measure of this value will be if a service delivers a level of usefulness and convenience that a user doesn’t want to lose.
IoT holds great potential for consumers but there is one stumbling block that must be removed before connected devices become widely accepted by users in a smart home or more generally. The challenge to be addressed is consumer concern about potential data control issues and IoT industry leaders must alleviate these before confidence becomes compromised and the promise of the connected world and smart home - the delivery of value - will be left unfulfilled.
The IoT value/trust paradox
In order to shed light on consumer perception of the value of IoT, a Cisco study explored what people find valuable and the role played by trust in their willingness to share data as part of the information exchange that drives value in all types of connected services, including smart home applications.
When it comes to IoT in the world around us, the survey revealed that consumers have a high awareness of connected personal devices and services, including those within a smart home, which is good news for the IoT industry. Home security systems along with wearable fitness devices, smartwatches and health monitors were identified as being part of IoT according to 63 percent of respondents. In addition, almost 50 percent of respondents said that smart home devices provide increased value, 66 percent saw increased convenience, and 60 percent increased efficiency. Even more significant was that 53 percent said they were unwilling to disconnect temporarily or even permanently from their IoT devices and services, because those devices were too embedded in their daily lives.
Although unwilling to disconnect, the study also found that in general, consumers are not comfortable with their data being collected by either personal or public IoT devices - 53 percent said they would rather not have any data collected, and 52 percent had either a low level of trust or no trust at all that their data was secure. This very low level of trust is a real threat to the consumer perception of value and indicates a paradox: a high level of value for IoT devices, but a low level of trust in the very thing that drives IoT services – the exchange of data.
Increase consumer confidence in three steps
Everyone involved in the connected home industry – from the original manufacturers of the connected products, the firms delivering IoT services, or those designing the homes where these devices will be installed – is poised on the edge of a huge market opportunity by being part of the IoT ecosystem. However, it will not realize its full potential unless the fear associated with IoT devices is addressed. Smart home businesses will live and die on their reputation for delivering trusted IoT services, with robust security and well managed data handling. Through this they will earn consumers’ trust and provide the security they need to embrace smart home living,
So how can smart home businesses help resolve the paradox of value vs trust for their users in order to accelerate and sustain IoT growth and the smart home?
Establish a clear, concise data policy then share it with customers. Consumers want more transparency and control of the data collected and shared across connected devices and services. If consumers understand how their data is being treated and can be assured that it is managed appropriately, they will have a better experience. This will lead to improved Brand reputation for the device or service and – as the Cisco study reveals – some customers would be willing to share even more data.
Take granular control of data. Not all data collected from a single device needs, or should, go directly to a public cloud. The ability to create a process to determine who gets what data, where and when and, crucially, the ability to show this to customers will be an important differentiator between vendors. Don’t take a blanket approach to IoT data.
Create accountability. Everyone in the IoT value chain has a critical role in data security, not just security software vendors: smart home device manufacturers, IoT service providers, application developers, network providers and cloud platforms all have their part to play. Evaluate all providers in the IoT value chain and establish minimum security standards and requirements so each provider has accountability.
Towards the connected life
There is no doubt about consumer demand for smart homes and connected services to provide convenience and efficiency. However, as data breaches continue to hit the headlines, consumers must be educated on how their data is being used to deliver these services in order for them to trust the technology and embrace the potential of a smart home. For many of the service providers behind IoT, a platform will enable them to provide the data management and transparency required around IoT data governance in order to enhance consumer confidence and trust. Ultimately, get this right and you will reap the rewards as consumer-demand in the smart home ecosystem is ripe and ready for harvest.