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We’re one step closer to living like the Jetsons.
According to a study released today by Juniper Research, the smart home market will reach $71 billion by 2018 — up from $33 billion in 2013, and $25 billion in 2012.
While this $71 billion figure seems large, it’s a rather modest estimate if you consider Juniper’s report last year; the firm predicted in 2012 that revenues would hit $60 billion by 2017. In fact, if the industry does not accelerate any further and continues its 2013/2014 growth rate of ~$8 billion per year, it will easily surpass Juniper’s predictions.
According to the new report, entertainment will be the main driver, accounting for as much as “80% of total Smart Home service revenues” — an interesting find, considering the push for smart appliances, like refrigerators and smoke alarms. More along these lines, Juniper states that “no single stakeholder [will] be able to dominate thanks to the number of verticals within the home.”
Amid all of this smart home excitement, some research firms are genuinely struggling to define and measure the sector. A report published in 2012 by Allied Market Research, for example, valued the industry at just $4.8 billion. The smart home market balloons in size if you include the service providers that supply products like smart TVs with content, as Juniper has done. Still, in defense of AMR, it’s potentially inaccurate to define Netflix as part of the smart home industry — even if it is currently a key aspect of the experience.
Despite these discrepancies, however, it’s clear that the smart home market is becoming increasingly measurable as it grows — if you focus on concrete deals like Google’s recent acquisition of Nest for $3.2 billion. Judging simply by the investments of companies like Google, Microsoft, and other industry giants, it’s easy to see why mouths are watering over the smart home gold rush.
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