Research Paper

On
STUDY OF HOME AUTOMATION AND ITS MARKET POTENTIAL IN
INDIA

Presented to
DON BOSCO INSTITUTE OF BIO SCIENCES AND MANAGEMENT
STUDIES

At
2ND INTERNATIONAL CONFERENCE ON SUSTAINABLE
DEVELOPMENT THROUGH BUSINESS STRATEGY AND SOCIAL
SCIENCES
18 MARCH 2016

By
RM Sudhakar
(Research Scholar Jain University, Aug 2012 Batch)
CEO, AUTOMAT - Netsoft Group,
No. 2453, 9 Main, 17 E Cross, BSK 2 Stage, Bengaluru 560 070
Email: sudhakar@automat.co.in, Ph: +91 9886795676
&
Dr. Y Vijayakumar
(Principal, Sri SAIRAM College of Engineering, Bengaluru.)

Title: STUDY OF HOME AUTOMATION AND ITS MARKET POTENTIAL IN INDIA

RM Sudhakar *, Dr. Y Vijayakumar **
* Research Scholar Jain University, CEO at AUTOMAT - Netsoft Group, Bengaluru
** Professor & Principal, Sri SAIRAM College of Engineering, Bengaluru.

ABSTRACT
Technology advancement is touching every corner, with the mobile device sales soaring high and
internet bandwidth cost coming down. Once the costly solutions like Home automation is now
affordable to most of them. The home automation technology makes life simpler and easier in
most of the way. Automated systems are being preferred over manual systems by the current
generations. The convenience of using smart phones to control home devices like Lights, Fans,
Geysers, Air Conditioning, Motorized Controls (Curtain, Gate) from any part of the world
remotely through internet / cloud networking is another breakthrough the technology has bought.
The home safety is of utmost importance to take care of near and dear ones. Though we are
developing in every aspect, but at environment level and energy generation, we have a major threat
and challenge, Home automation addresses the most need of the hour, energy savings and supports
Go-green concept. This research paper is to know what is Home Automation?, The technology
behind the Home Automation, what are the different home automation systems that are available
(Wired & Wireless Automation solutions), Key drivers of the Home Automation market, Market
of Home Automation in Global and in India., Challenges of Home Automation market, Benefits
of Home Automation to the home owners.

Key Words:
Technology, Home Automation Systems, Smart Home, Internet of things, IOT, Home Automation India,
Wired & Wireless Home Automation

INTRODUCTION
Technology advancement is touching every corner, with the mobile device sales soaring high and
internet bandwidth cost coming down. People who travelled in flight or visited Luxury Hotels have
already experienced various automation comforts starts with automated motorized glass door,
Automated Temperature control, lights which turn on when they enter the washroom, water which
is turned ON when they stretch their hand towards wash basin, auto flush, and so on. The
automation is not limited to only Airports or Luxury Hotels or Buildings. Home Automation with
much more convenience, safety, savings (time & energy) and convenience is here and has become
much more popular. Once the costly solutions like Home automation is now affordable to most of
them. The home automation technology makes life simpler and easier in most of the way.

Home of the 21st century shall be very secure and intelligent. Automated systems are being
preferred over manual systems by the current generations. We call this sweet home as Smart
Homes which shall be more self-controlled and automated due to the comfort it provides,
especially when employed in a own home. A home automation system is a means that allow users
to control electric and electronic appliances of varying kind. The convenience of using smart
phones to control home devices like Lights, Fans, Geysers, Air Conditioning, Motorized Controls
(Curtain, Gate) from any part of the world remotely through internet / cloud networking is another
breakthrough the technology has bought. The home safety is of utmost importance to take care of
near and dear ones. Though we are developing in every aspect, but at environment level and energy
generation, we have a major threat and challenge, Home automation addresses the most need of
the hour, energy savings and supports Go-green concept.

This research paper is to know what is Home Automation?, The technology behind the Home
Automation, what are the different home automation systems that are available (Wired & Wireless
Automation solutions), Key drivers of the Home Automation market, Market of Home Automation
in Global and in India., Challenges of Home Automation market, Benefits of Home Automation
to the home owners.

LITERATURE REVIEW
Brush, A.J. Bernheim., Lee, er. al., (2011), Home Automation in the Wild: Challenges and
Opportunities. This research is conducted by Microsoft Research, University of Washington to
analyse the Visions of smart homes. The research analyses that these technologies have not been
widely adopted despite being available for over three decades. To gain insight into this state of
affairs, researchers conducted semi-structured home visits to 14 households with home
automation. Researcher study of long-term use of home automation illustrates why participants
use automation, the diversity of use across households, and how both Outsourced and DIY
households struggled, albeit in different ways. The long term experience, both positive and
negative, of the households researcher interviewed illustrates four barriers that need to be
addressed before home automation becomes amenable to broader adoption. These barriers are high
cost of ownership, inflexibility, poor manageability, and difficulty achieving security. Research
findings also provide several directions for further research, which include eliminating the need
for structural changes for installing home automation, providing users with simple security
primitives that they can confidently configure, and enabling composition of home devices.

Sripan, Meensika., et. al., (2012), "Research and Thinking of Smart Home Technology".
Researcher identifies that smart home is emerging technology which is continuously growing.
With smart homes, the way people live will obviously become more efficient and comfortable.
Author says that all the time, our home can be saved from home automation, so we will have
much time to work on other pursuits. Researcher describes three main challenges of Smart home
technology as Security, adaption to new environment and high cost of intelligence. Despite of
challenges researcher concludes by mentioning that smart home technology is a good choice for
people who care about security and comfort but energy saving as well. Smart homes will become
more ubiquitous because new technologies will be explored more and more.

Palaniappan, Satish., et. al., (2015), "Home Automation Systems - A Study", Researcher says that
with the increase in consumption of energy and population, there is a grave need to conserve
energy in every way possible. Researcher says that based on all the systems surveyed and their
advantages and drawbacks, this paper presents the features to be possessed by an ideal system for

home automation with remote access. However, the data channel of GSM must be used, to provide
internet access. Only the Internet can ensure that access can be made available at all times. This
will give rise to a standard access method for the home appliances using the Internet protocol. The
user interface should be a web application that has an associated mobile application. So that people
of all kinds can access the system. Such a system should also have the feature of being easy to
install. Only then can automated homes become commercially viable. Researcher says that there
should be a lot of thought put into the design of the user interface for these apps. Plug and play
capabilities will be an added bonus for the system. Ease of adding a new device to an automated
house will play an important role in taking forward the systems commercially. Researcher
concludes by stating that the future scope for the home automation systems involves making homes
even smarter. Homes can be interfaced with sensors including motion sensors, light sensors and
temperature sensors and provide automated toggling of devices based on conditions. More energy
can be conserved by ensuring occupation of the house before turning on devices and checking
brightness and turning off lights if not necessary. The system can be integrated closely with home
security solutions to allow greater control and safety for home owners.

Kumar, Abhay and Tiwari, Neha, (2015), "Energy Efficient Smart Home Automation System".
The research focuses on planning of a system which will minimize energy waste in home
environments with efficient managing devices operation modes. The author uses design which
tend to use a wireless sensing element network to observe physical parameters (like light-weight
and temperature) additionally because the presence of users reception and in every of its rooms.
Author observes that when users change their habits as a result of unpredictable events, the system
is able to notice wrong predictions analyzing in real time info from sensors and to switch system
behaviour consequently. This research is based on the meaning of smart phones and its details of
smart home elements projects and challenges. Author says smart is the good and beneficial which
is very much easy for the security and comfort but who also want to save their electrical energy
that is wasted by many people in regular span of time. Authors conclude by stating that with the
introduction of smart home people live more comfortable life.

OBJECTIVES OF THE STUDY

To understand the current trend in home automation

To observe and analyze the need for home automation

To understand the acceptance of home automation by end users and the builders

To study the penetration of home automation

To understand the market segment for home automation products

To study and understand various challenges for home automation industry

METHODOLOGY
An exploratory study was conducted by 180 selected experts from the industry. Primary data was
collected through structured interview. For the research purpose, published reports, research
papers, newspaper reports, blogs, conference proceedings, were considered.

LIMITATIONS OF THE STUDY

The study is limited to the top level overview of the Smart Home Automation market
in India and Globally.

The study is limited to experts only as the awareness about the concept is very less.

As structured questionnaire was not administered, there may be a possibility of

misinterpretation of the question asked during the interview.

Since the concept is very new, lack of knowledge about the same may have influenced
the responses.

AUTOMATION
The automation and control systems market may be broadly classified into building automation
and home automation. The deployments of these automation systems are in industrial, commercial
and residential settings. The commercial market, which includes Corporate Houses, Offices,
Hotels, Hospitals, Educational Institutions and other types of buildings accounts for a bulk of
revenues of the India Automation Market; on the other hand, the residential market is regarded as
an immense growth opportunity in the present scenario due to the increasing entry of dwelling
units in a large number of cities and towns across India.

HOME AUTOMATION
Home automation refers to the centralization on a unique user interface of five main home systems:
1.

Home Security - CCTV (Closed Circuit Television), VDP (Video Door Phone),
Intrusion / Burglar Alarm System, Panic System, LPG Gas Leak Sensors, Smoke
Detection System, Intercom, etc.

2.

Lighting Control (ON/OFF, Dimming, Scenes, Mood lights)

3.

Home Energy and Utility Management - Smart meters with energy consumption
details, Solar Energy & other alternative Green Energy

4.

Temperature Control- Thermostats, HVAC (Heating, Ventilation and AirConditioning), etc.

5.

Entertainment Audio & Video, Home Theatres and Voice controls

The Worldwide home automation technology market is witnessing remarkable growth thanks to
the demand for home automation and security systems that improve the efficiency of all kinds of
homes. Home automation technologies not only simplify living, but also increase energy efficiency
and secure lives. The home automation by application can be classified as Entertainment (Home
Audio & Video), Lighting, Safety and Security, HVAC, Energy Management and others (Home
Robotics and Home Healthcare)
One of the widely used home automation and control systems is lighting, which results in
significant energy savings. The largest segment of the home automation market, however, is in
entertainment controls, which include Audio/Volume Control, Home Theatres, Keypads,
Multimedia Room Controls and Touch Screens.
Major players contributing to the growth of the global home automation market include AMX
Corporation, ABB Ltd., Control4, Crestron Electronics, Inc., GE Security, Haier Group, Home
Automation Inc., Honeywell International Inc., Lightolier Controls, Lutron Electronics, Inc.,
Schneider Electric Ltd., Siemens AG, SmartHome Controls Ltd., Smarthome, Inc., Vantage
Controls Inc, among others. There are special bodies who work on the technology specific products
and the popular ones are KNX (wired) and Zwave (Wireless).

SMART HOME AUTOMATION

Smart Home Automation solution focuses on complementing home owners lifestyle with control
of Lighting, Climate/Temperature (HVAC), entertainment systems (TV, Home Theatre, Audio&
Video), Security & Surveillance (CCTV), Motorized equipment (Curtains, Blinds & Gates),
Locks, Sensors, Home Appliances, Garden Control, Green & Solar Energy. Smart Home
Automation integrates these systems with a home network to give you simple & complete control
which can be controlled through smart devices (Smart Phones, Tablets, Touch Screens) and
remotely (through the internet from any part of the world). The user can get updates through SMS/
Email / Push Messages and can give control through Voice Command or Global positioning
system or sensor based actions and many other ways based on the features provided by the
automation solution provider.
The four functional segments of home automation in India include Lighting, Security,
Audio/Video and HVAC (Heating, Ventilating, and Air Conditioning). A detailed segment wise
breakdown of the systems is given below:
FUNCTIONAL

ITEMS CONTROLLED

SEGMENTS
LIGHTING:

Bulbs, Chandeliers, Fans, Geysers, Shades

FUNCTIONS
Scenarios, Dimmers, Energy Savings,
Motion Sensors

SECURITY:
AUDIO

Door Locks, VDP, CCTV, Hooters, Smoke

Door / Window / Smoke / Motion Sensors,

Sensors, LPG Gas Sensors,

Alarm, Alerts

/ Home Theatre Systems, TV, Music Systems, IR Control Operations (Volume, Recording,

VIDEO:

(infrared) Modules

Channels)

HVAC:

AC (Thermostat), Centralized Heating Systems,

Temperature Control, Climate Control

Table 1: Functional segments wise items controlled and its functions.

The Major benefits the Smart Home is sought for:

Enabling beautiful yet smart living has experienced in homes.

Augmenting the safety and convenience of the elderly, physically challenged & for the
entire family.

To get the digital living with ones imagination into reality in automating his/her needs.

Major driving forces for installing smart home systems are Safety, Security, Convenience and
Energy Conservation.

HOME AUTOMATION TECHNOLOGY

Home Automation is broadly classified as Power Line systems, Wired Systems and Wireless
Systems.
Power Line systems leverage the existing power lines of home to transmit information to a
common control interface. They commonly use Insteon / X10 Technology, an international and
open industry standard for communication among electronic devices used for home automation.
Currently this system is limiting users and solutions providers.
Wired Systems use Data cables (CAT 5/6/X) to communicate information, usually connected to
a proprietary control system (leading brands like ABB, Crestron, Legrand, Schneider) or a more
open control center (like KNX). In this system the power line of each equipment has to be
connected to the central automation, distribution board (this demands additional cables which are
a cost) and a data cable has to be drawn to the required locations for Keypads/Touchpads
(Automation Switch or Scenes controller). This is a more reliable automation system, however its
limitation is that it is not upward scalable means any add on to the automation system means
additional cabling (which is breaking the walls).
Wireless Systems do not require cabling behind the walls to communicate with the automation or
central controller. Wireless home automation systems have developed very rapidly and integrates
with Wi-Fi networks, so they can be integrated into existing home networks, including computing
networks. The most popular wireless automation technology is Zigbee, Zwave & Wi-Fi. In this
system, there needs to be a sender and receiver. The automation gateway has to be configured with
all the wireless devices like Relays / Actuators / Sensors / Infrared Modules. Currently Z-wave is
one of the reliable and affordable wireless home automation solution. The wireless system main
advantage is scalability both upward (adding more automation device or equipment) and
downward (removing or moving existing automation devices or equipment).

WIRED VS. WIRELESS SYSTEMS

Home automation is provided popularly in two ways Wired Systems or Wireless Systems. Wired
Systems are preferred at the time of construction as this needs a special wiring system for the home
automation. Wireless systems rely on the conventional or existing wired structures (power lines)
at home.
Wired systems are typically used when the automation is done at the time of construction, making
installation easier. Wireless technology largely relies on existing wired structures (power lines) at
home. Wireless technology is however less invasive and more convenient and given the
proliferation of smart phones and smart home appliances, are fast gaining popularity.

Major differentiator of both the systems is listed in the table below:

Parameters

WIRED

Features:

reliable

WIRELESS
and

most

durable

technology.

Installation

Maintenance:

Can handle large bandwidth

Durable works for years

Quick response time

Can seamlessly operate without the

congestion of wires

Decrease in response time by a few

seconds

Ease of access

Smooth & simple technology

Has to be planned at the time of

Quick installation

construction

Retrofitting is easy

Special wiring is necessary

Requires fewer hours and is very

Can be done in less than a day, in

convenient to install

some cases it could get up to a week`s

Prerequisite and dependency on Wi-

time.

Fi System

Works based on the CAT cable

Troubleshooting is a difficult task in

Easy

case of any issue arise

networking

Need special skilled and trained

background technician can maintain

resources whose availability, are

it.

to

use

technology;
and

electrical

limited

Cost

Expensive in terms of the product

Is available at a very competitive

price.

Cabling and its labours are the

Affordable, no more a costly product

additional cost.

and affordable by many

The most expensive products are

available in wired ranges.

Interface

Switches, Touch Plates / Keypads,

Smart Phones, Tablets, Remote

Wall Mounts, Interactive Screens.

Controls, Table Tops.

Can

also

be

operated

through

Remotes and Smart Devices but not

Can also be operated through normal

switches.

normal switches.

Advantages

Quick

response

of

automation

Retrofitting - can be used in existing

systems.

houses.

Size or measurement of the house

Remote Management can be done

doesnt matter. It can be used for a

through Cloud System and one of

home to large buildings.

the popular IOT (Internet of Things)

There is no limit of number of devices

product.

or appliances that can be connected to

Completely Scalable (both upward

the home automation systems.

and downward)

The lifetime of the systems is more

Start with minimum automation and

due to wired communication.

scale up to any level.

As these systems, including sensors

Apps is easy to use and is regularly

are

evolving due to the volume of the

not

battery

operated

the

replacement or maintaining part of it

is minimised.

product sales.

Interoperable

with

many

other

products.

Quick installation and very cost

effective and easy to maintain.

Aesthetical
include
with

benefits

representative

all-glass

(Examples
buildings

architecture

and

historical buildings where the design

or conservatory reasons do not allow
laying of cables)

Disadvantages

Difficult to retro-fit & maintain

Slight (fraction of seconds to few

Lack of interoperability between

seconds) delay in the response of

different products

automation systems.

Lack of remote management from

Limited to the house and not for a

outside

large units or houses.

Settings to be configured only by

Number of devices per gateway or

company engineers

automation controller, some systems

Lack of flexibility for adding new

support up to 230 devices.

products (scalability limitation)

The lifetime of the systems are

High installation time & costlier

limited to the electronic operations.

Apps of limited features and upgrades

Few products like sensors which are

are available based on the company

based on the batteries needs frequent

that sells.

replacement based on its usage.

Not a complete IOT solution and has

limitations on the cloud solutions.

Limitations of interoperability or
integration with the external devices.

Table 2: Differences between wired and wireless systems.

In recent years, wireless systems like Wi-Fi have become more and more common in home
networking. Also in home and building automation systems, the use of wireless technologies gives
several advantages that could not be achieved using a wired network only.
For all the reasons as pointed in the above table, wireless technology is not only an attractive choice
in renovation and refurbishment, but also for new installations. And it is imperative to know that
the home automation market worldwide is making a shift from wired to wireless systems.

HOME AUTOMATION MARKET GROWTH DRIVERS

The digital space has undergone major transformations in the recent past, and has witnessed the
surge of disruptive technologies. The latest entrant in this space is Internet of Things, which
broadly can be defined as a network that is connected devices together for communicating amongst

themselves and taking decisions. Just as the first decade of the 21stcentury witnessed an
unprecedented increase in adoption of mobile phones, the coming decade is going to witness the
proliferation of Internet of Things (IoT) and Smart devices- which will increase resource efficiency
in all facets of our lives and the products we use. Smart Home Automation is one of the main IoT
application.

According to a report by Cisco, as of 2015, there are approximately 3 smart devices per person in
the world. This number is expected to rise as the number of connected devices will reach 50 billion
by 20201.

Figure 1: Population and total number of smart devices in the world

CISCO IBSG REPORT 2013

Figure 2: Bandwidth cost

From the above figures it is clear that the usage of smart devices is more and the bandwidth cost
compared to 10 years back it has come down substantially. This is a clear indication that IoT as
such is the happening technology and Smart Home Automation is going to grow with it
accordingly.

The main growth drivers of the home automation market are comfort, modularity and peace
of mind, especially when it comes to security, while energy management emphasizes cost
savings.

Security and energy management are the more advanced systems in terms of integration,
while home automation is still at the early stages of development.

The popularity of home automation has been increasing greatly in recent years due to much
higher affordability and simplicity through smartphone and tablet connectivity.

The rise in standard of living, combined with the growing awareness of both security and
energy efficiency driving the demand and supply side for home automation products.

Home automation market is mainly driven by the declining cost and complexity of home
automation products. Once perceived as elite class-only, the home automation products
are gaining widespread popularity mainly because of the development of standard-based
technologies that can be integrated into existing communications/ utility infrastructure of

modern homes, resulting in lower cost systems that eliminate the need for bulky hardware
and cabling.

New initiatives such as Googles Android at Home can bring increased consumer
awareness of Home automation systems and facilitate interoperability between equipment
from multiple vendors.

The home automation industry is also opening up a new potential market for cellular M2M
devices and services.

HOME AUTOMATION MARKET - GLOBAL

The home automation, global market is estimated to see North America retain its position as the largest
market. Revival of construction activities, especially for new residential buildings and renovations, is
expected to support market growth in the region. Of all the applications of home automation systems,
growing consumer preference for safety and security solutions is expected to result in safety and
security segment dominate market growth across all these regions. Energy management and HVAC
automation systems too are expected to see a similar growth phase towards the second half of the
forecast period. Deployment of smart meters and need to curb household energy bills is further expected
to drive the demand for such systems, especially in Europe and North America, which are at the
forefront of smart meter installation. The home automation market was valued at USD 3.6 billion in
2012 and is expected to reach USD 16.4 billion by 2019, growing at a CAGR of 24.6% from 2013 to
20192.

HOME AUTOMATION MARKET INDIA

The India automation and control systems market has seen significant changes in dynamics over
the years. According to industry estimates, the India automation and control systems market is
expected to grow at a CAGR of 30% over the 5 years to 2019, with applications such as security,
lighting and energy management likely to play an important role in achieving this significant
growth rate. Increasing data thefts, burglaries, demand for enhanced security, the need for energy
management / conversion, are a few of the key factors that have spurred the India automation and
2

ResearchMoz, Home automation market Global Industry Analysis 2012-2019

control systems market. The Indian building automation & control systems market is anticipated
to grow by three folds, in revenue terms, by 2019, exhibiting robust CAGR of around 21.7% during
2014-193.

Initially concentrated in the areas of HVAC and security systems, the market has now evolved into
newer areas like lighting systems, fire detection systems, entertainment systems and energy
management systems as well. The automation not only integrates different automation systems as
mentioned, but also enables substantial power savings.

The rise in standard of living, combined with the growing awareness of both security and energy
efficiency driving the demand and supply side for home automation products. Though the
economic

crisis

has

somewhat

dampened

the

construction

of luxuriousautomated

homes, researches are of the view that it will once again flourish in the coming years, as the
technology-savvy young generation of today will become homeowners in the near future.

Also, it is imperative to note that the market is mainly driven by the declining cost and complexity
of home automation products. Once perceived as elite class-only, the home automation products
are gaining widespread popularity mainly because of the development of standard-based
technologies that can be integrated into existing communications/utility infrastructure of modern
homes, resulting in lower cost systems that eliminate the need for bulky hardware and cabling.
Home automation in India is rapidly growing and is used in a variety of applications across
residential, commercial and hospitality segments.
According to Redseer consulting, research paper Home Automation Market in India An
overview of the market and drivers impacting its growth is as below:

TechSci Research report India Building Automation & Control Systems Market Forecast & Opportunities,
2019
3

Figure 3: Functional segments in home automation in India

Home automation could have well been a part of science fiction many decades ago, but is a reality
today. Home automation has its roots in smart home appliances which has over the years led to the
development of integrated smart homes. 4
Home automation today largely consists of four functional segments Lighting, Security,
Audio/Video and HVAC (Heating, Ventilating and Air Conditioning). The home automation
market in India is expected to reach INR 8800 crores by 2017, with the residential segment
accounting for nearly 60% of the industry. Home automation in India today consists of four
functional segments Lighting, Security, Audio/Video and HVAC (Heating, Ventilation and Air
Conditioning).
Lighting is the largest component of residential market while security is the largest component of
Commercial market. The key growth drivers of this demand are increasing consumer awareness
and financial ability, product innovations (like smart phone apps), builders requirement for market
differentiation and an increase in the preference for energy efficient systems.

Redseer consulting research paper "Bringing convenience home - Home Automation in India Fast evolving and rapidly growing

However the market is still in its growth phase with a significant gap for more innovative and
connected systems. Some of the key constraints include high product costs and moderate levels of
satisfaction among the customers.

LEADING MARKETS IN INDIA

The market is currently concentrated in top-10 cities and a few smaller cities; companies are
looking at tier-2 cities for their next level of growth.

Figure 4: Market share by geography

It can be observed that certain areas have shown higher growth and this can largely attributed to
two factors growth of IT Hubs and HNIs (high net-worth individuals). HNIs are concentrated in

NCR, Punjab and Gujarat and IT Hubs are located in Pune, Hyderabad, Bangalore, Noida and
Coimbatore.5
Pune currently is the biggest market for home automation in India. The market shares for key
markets are as follows:

Figure 5: Market share by region

MARKET ANALYSIS
a) Customer segment analysis 6
The residential segment accounts for nearly 60% of Indias home automation industry (out of
which individual homes and villas account for 75-80% of the market and builders account for
~20% of the market). This segment has the highest growth and is currently growing at a CAGR of

Redseer consulting research paper Home Automation Market in India - Deep dive into the
future trends of the market
6
Redseer consulting research paper Home Automation Market in India - Deep dive into the
future trends of the market
5

35-40%. The market for residential home automation is highly fragmented, especially in home
security systems.
Commercial spaces contribute to 30% of the home automation market. This segment is largely
driven by security and access systems. Large companies like Samsung, Bosch and Honeywell
dominate this segment in India. Efficient building management systems are fast gaining popularity
in India as well.
The hospitality industry also uses home automation and accounts for 10% of the market. Security
and lighting systems are popular in this sector due to the growing need for differentiation.
b) Product segment analysis7
Lighting and security are the top selling products in home automation, accounting for nearly 8085% of the market.
The lighting market is largely driven by the residential segment. In India, the industry is still
dominated by remote control solutions as mobile apps and other advanced solutions are costlier.
Lutron, Philips and Legrand dominate the lighting market in India. Security systems are also
becoming very popular in India and are used by both the residential and commercial segments.
CCTVs accounts for about 25% of the security systems. The market for security systems is
however highly fragmented between local, Chinese and other international players.
HVAC and Audio/Video systems account for about 15-20% of the market and is typically provided
in hotels and commercial complexes; residential applications are still low. HVAC is largely done
in complexes with centralized air-conditioning.
A market split by product and customer segments can be seen in the chart below:

Redseer consulting research paper Home Automation Market in India - Deep dive into the
future trends of the market
7

Figure 6: Market split by customer and functional segments

It can be seen from the chart that lighting is the largest component of the residential market while
security is the largest component of the commercial market.
Overall, the market is highly fragmented, largely due to the low entry barriers. Availability of open
source technologies makes it easier to enter the market. Innovation is the driving force of the
industry and the market is evolving fast both in terms of technology and features (mobile apps
etc.).
In India, the home automation market is expected to grow significantly over the next few years
and will witness growth both in terms of number of players and technologies offered.

MARKET ANALYSIS BY PRODUCT SEGMENTS

a) Lighting Market 8
The lighting market makes for 39% of the home automation market, thus being the second largest
segment of the market (the first being the security market at 45%).The lighting market is highly
fragmented with 60% of the market captured by the organised players and the rest by unorganised
players. Legrand leads the market, followed by the next 25 players. The unorganised market

Redseer consulting research paper "Bringing convenience home - Home Automation in India Fast evolving and rapidly growing

largely constitutes of local players who import sensors, switches, control boxes and remotes from
other markets such as China.

Figure 7: Market share by product segment and players

b) Security Market 9
The security systems market is the largest product segment in Indias home automation market.
The market is dominated by organised players; nearly 70% of the market is made up of organised
players. Zicom, Honeywell and Bosch lead the market this segment. The unorganised market
includes players who sell CCTVs, alarm systems, door sensors and video phones imported from
China.
The security and surveillance and market in India stand at INR 9000 crores. The industry and
government security market accounts for 85% of the security market.

Redseer consulting research paper Home Automation Market in India - Deep dive into the
future trends of the market
9

SMART HOME AUTOMATION CHALLENGES

As any new system is going to bring change in the regular habits of the consumer, which is not
usually embraced by many. The technological change is still a taboo in Indian scenario and has
the challenge to face the change and Smart Home Automation is under the test phase and
undergoing the following challenges.

Convenience and comfort functions offered by Home Automation systems are not
critical or essential and thus suffer when the financial and economic picture is gloomy.

The best time to install a Home Automation system is during new home construction
in terms of convenience and as such growth of Home Automation depends on the
growth of the housing market.

Other challenges include lack of awareness of Home Automation offerings and the fact
that consumers in many segments do not see a strong reason for Home Automation
systems.

The costs involved in terms of equipment, installation and ongoing maintenance and
service, are all perceived as deterrents.

Added to the cost of home automation technologies is the price of bandwidth that rule
the proliferation of multimedia, which is an integral part of home automation systems.

Deployment costs and labor are site-dependent and may represent a constraint until
uniform packages are launched.

The next primary challenge for home automation is the existing disparity of
technologies (e.g. wired versus wireless networks, diversity of protocols and
platforms). Players are developing alliances and partnerships along the value chain to
promote and develop their platform.

Home automation vendors are expected to deliver customized solutions that suit the
demands of individual customers. This results in a lack of proper service strategy,
including SLAs (Service Level Agreements) and pricing plans. Standardisation of
home automation technologies and their seamless integration into existing home
infrastructure will address these challenges.

Service providers are also challenged by the huge infrastructural costs associated with
providing seamless communications to emergency home automation systems.

Owning a smart home means having to learn and adapt to new environments.

Product and Supplier related: Although foreign players are entering the market, the
process of purchasing and maintaining a system sold by a foreign player is still not
smooth. Some of the drawbacks of foreign players in India are as follows:
o Product replacement times are as high as 4 weeks
o Lack of service infrastructure as 1 service engineer services up to 400 clients
o Lack of support for India-models of products as codes are written for Foreign
(US/Europe) models
o Lack of support for system integrators
o Unsuccessful solutions by MNCs is leading to system integrators creating their
own protocols or switching to open source products.

SMART HOME AUTOMATION BENEFITS

Smart Home automation provides various benefits to the consumers and some important ones are
as below:

Acts as a Security Guard

Home automation provides various security and safety features for the whole familys
wellbeing. Alerts user to the specific area usage in uncommon time. Shall be completely
vigil when user are out of home.

Its Safety first

The Video door concept shall let user know who is in entrance and sends the user a picture
message when user are out of home. Allows user to open the door with the help of Home
automation interface.
In incidents like fire the Home automation system shall do the necessary actions that are
viable including dialing the concerned person.

Physically challenged & Aged people Boon

Smart Home System is a boon for the Handicapped and aged people. As the dependency
on them on others can be minimized as much as possible. They can turn ON / OFF - lights
/ fan / other devices at their wish with the remote control or smart devices or smart sensors

shall Turn ON / OFF the lights based on their presence / absence. Panic Alarm in case of
emergency shall alert their near and dear ones to act accordingly and its a life saver.

Kids Safety
The safety solutions that home automation provides include flood sensors, shock sensors
and smoke sensors which contribute to a safe environment. CCTV security cameras, if
placed strategically the working parents can track their kids and alert system shall help
them to be closely associated with their kids even far from them. Maid servants who are
left alone with the kids is also being in control with the various features and facilities that
home automation provides.

Home Automation ROI (Return on Investment)

Energy Management features in Home automation shall give users an idea of the usage and
assists in saving electricity bills. The automated schedules and sensor based lighting shall
ensure no power is wasted by Mistake. Dimmers shall make sure the light intensity is as
required.

Saves Energy pilferage

Generally, when the electrical equipment is plugged in but it is not in use, there still has
the flow of electricity. That means we will lose the electrical energy about five to ten
percent of regular usage, so that wastes money for no reason. Moreover, that may also be
the cause of many accidents such as the conflagration from electrical short circuits.
Therefore, many people who always forget to unplug the electrical device have to remind
themselves every time they go out. On the other hand, if they go out with forgetting to
unplug, they must go home to pull the plug out to avoid the dangerous situations, so it is a
waste of so much time. In order to solve these problems, smart home technology will be
required.

Talk to your home Scenes or Moods

Scenes or the various lighting status and lights dimming capacity with the Fan or A/c
temperature as user need. Users can create scenes or templates that match their specific
moods. User can create a scene of Dining time, Welcome Home, Family Time, TV or
Movie Time & more.

Make Life more Productive

Automate the common activities in the home with the help of Home Automations
Intelligence features like Morning Activity - user daily alarm, actions to be performed at a
specific time and day, prepare coffee for the user, set the TV channel user like; Evening
Activity make the home to welcome the user with his/her interest by opening the garage
door, setting the room temperature and lighting; Weekend activity and many more. User
can use these saved time for himself/herself.

Support Staff
The whole world is facing the challenge of shortage of manpower in support activities like
house maid, servants and security guards. Even the trust of the available support staff is
still a concern. The Smart home system shall decrease the dependency of these support
staff activities.

Home Assistant
Custom Schedules provides user various options to automate the common lighting and
other home appliances activity. Like common area lighting shall switch ON every evening
@ 6:30PM and goes off at 10PM.

Control from anywhere

User can Turn ON/OFF Home Lights or other appliances from any part of the world
through his/her smart devices. Turning ON the geyser before reaching home is the need of
many, setting up the home temperature shall be very beneficial, heating up the meals is an
another important area, motorized gate which shall open up as car reaches is critical for
security and convenience reasons. Smart home systems provide these benefits and much
more.

MAJOR FINDINGS

The Home automation market is going to be here and it is no more limited to the rich class
of society.

The Home security has good traction and growing rapidly. Medium luxury homes are
considering this as a prerequisite of their homes, which is a good sign.

The Home Automation is being accepted well in Builders segment and IT (Information
Technology) hubs / Metro Builders are implementing it to make their offer more attractive
to customers which shall help them in their sales and for better cash flow. However the
level of Home Automation that each builder investing varies based on the need and the
budget that they can afford.

The Brand is a very important parameter for end users, especially in the security domain.
However, a brand is not a significant factor for builders, as price is the most important
consideration for builders.

As the affordability of the Home Automation has come down (wireless solutions close to
INR 1 Lac) more and more Tech Savvy Home buyers are going for it.

Apartment home buyers have a limited option of technology selection of Home

Automation. As this depends on the type of wiring the builder would have implemented.
Wireless Home Automation comes handy for the apartment buyers and major reason for
this being of the Retrofit ability and Cost-effectiveness of the solution.

The Independent Home Owners or Villa or Bungalow Owners are still in dilemma of
choosing the right automation technology that best fits them. As the best selection over
Wired and Wireless is still in debate. The more number of people the owner consults the
more he/she shall be confused. Over a time this shall be easy due to the rapid development
of the solutions and due to more and more manufacturers entering into this market to get
their share of the business opportunity.

The Indian market is a great potential for both the local and foreign players to invest in this
space. As Make in India program of the Indian Government is encouraging both the local
and foreign players to manufacture the best in class solutions and also it is providing
various benefits that the manufacturer is looking for. With the potential of the home
automation market in India, it shall be no surprise to see that there shall be many products
both local and international products for the customers to choose from.

The demand of more electricity power in the near future, can be addressed with the better
utilization of the power that is being generated and by avoiding the pilfering of the
unwanted power usage. The Home Automation system shall support in energy savings and
with the greener solutions it contributes towards a better environment.

CONCLUSION
With smart homes, the way people live will obviously become more efficient and comfortable.
Smart Home Automation shall save time of the home buyers from the mundane activities, which
can be well utilized for other efficient pursuits. Smart home technology is a good choice for people
who care about security or comfort or energy savings as well, with the affordability part this shall
reach to more number of users in urban and to the rich class in rural areas as well. Smart homes
will become more ubiquitous because new technologies will be explored more and more.
Also an attempt is being made by the researcher to assist the home buyers to choose the best home
automation solutions by giving the various pros and cons of the available (wired and wireless)
home automation solutions. With the potential of the home automation market in Global and India
there shall be more and more service providers and products to choose from shall benefit the
market as a whole.

SUGGESTIONS

Technology decision
o For Independent house owners

If budget is not a constraint and you need best of the product then go for
Wired Home Automation (Crestron, Lutron, Control4, AMX, Legrand, )
for better reliability and stability of the product and for the elegant look of
Touch Panels or Keypads.

If budget is limited and do not need the best of features and functionality
then go for the simple wired home automation solutions (Schneider Clipsal,
KNX based and other Proprietary Products).

If budget is limited and need the best of features and functionality then go
for the Wireless Home Automation (Zwave based systems offered by
various vendors like Vera, HAI, Fibaro, AUTOMAT ).

For a budget automation it is better to choose for Wireless Automation.

Zigbee based products are more cost effective and is old in the market,
however it has its limitation in the feature and functionality.

For a semi automation, customers can choose RF or Wi-Fi based Home

Automation Systems.

o For Builders / Flat owners

For a premium projects the options can be wired or wireless, based on the
expectation as pointed above (refer technology decision for independent
house owners).

For not so premium projects, go for wired automation if the expectation is

to give a better and reliable automation system with aesthetics - touch panel
(over the traditional mechanical switches). Solutions can be KNX based or
other proprietary protocol system who can give customized solution at a
competitive price.

For luxury projects with budget limitation it is better to go to the wireless

options and choice is again based on the kind of features that the builder
would like to provide.

o Wireless home automation shall be viable for the house owners who would like to
start with small and would like to go for the full home automation in near future.
Also for the existing home owners, wireless shall be the best option.

Smart Home Automation is a viable business model for the technology manufacturing
companies who would like to add more solutions in their portfolio or for the new
manufacturing companies.

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