What’s in smart homes for telcos?


Yves Caseau,
Executive Vice
President, Bouygues
Interview with Yves Caseau, Executive Vice President, Bouygues Telecom, France

How profitable an opportunity is the smart home for telcos and utilities and how much more do they stand to gain when they ‘pull together’ and partner up?
Telcos need to expand their domain to find new growth, from telecommunications to digital life. An interesting property of digital life is that, because of its rising complexity, it may work better if operated, that is with the remote assistance of an operator. Smart homes are one of the most concrete opportunities of this digital life field, the combination of a home, multiple connected objects, together with comfort and efficiency services bundled into “life moment scenarios”.

This is indeed a growth sector, but it requires a “platform approach”, that is, the growth of an ecosystem with a “long trail” of “home apps” and services provided by third parties.
How can stakeholders better communicate with consumers and instill confidence in them, and whose responsibility is it to educate the consumer about better conserving energy?
Telcos together with their ecosystem partners need to educate their consumers about what is already there! This starts with better, more concrete advertising, showing the practical value and use of existing services, such as the cloud. This education also needs to become social, for instance the stakeholders can provide their customers with web platforms.

One could argue that everything is already on the web, but the smart home experience deserves better and a more specialized community with 2.0 tools.

Lastly, telcos need to provide reassurance; this is an operator role, part of taking care of our customers. It is not enough to sell, we need to demonstrate and ensure that smart home services deliver everyday value.
How is the market defining and measuring growth?
Value and growth are measured with sales of objects/accessories and services. The first KPI is the equipment rate of connected devices that slowly transform regular homes into connected homes. Once a critical mass is reached, telcos may start to bundle objects with services and measure the subscription rate of service apps and the bundled “smart home plans”.

The last measure of success is the incremental growth of subscribers’ value, which is the sale of additional objects. This requires a value-share mechanism so the telco may make a profit.

Yves Caseau is a panellist in the session ‘Reviewing the macro environment to determine the state of the smart home industry and its future’ and will be presenting on ‘Building the ecosystem and delivering value to the customer’ in the Smart Home track at European Utility Week 2013 on Tuesday October 15.

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