Closed ecosystems and the smart home

Time and again I hear about interoperability challenges and the internet of things. To put it simply, if we’re looking at connecting tens of different devices in different environments, closed platforms are not just going to annoy consumers, but I believe are going to make it more unlikely that the internet of things will succeed on the scale many hope it will.

Trying to lock up IoT in a closed platform under one tech giant will be very difficult. This won’t be as simple as something like an iPad, iPhone and Macbook where you’re dealing with three devices. Rather it’s closer to making the whole physical environment connected and thus much closer to the internet, which only works because it’s an open system. Imagine not being able to go to both the Samsung website and the Apple website on your web browser because they wouldn’t be able to link to each other.

That may sound like a crazy analogy but what happens when you have five, ten or twenty devices in your home that you want to communicate with and more importantly, you want to communicate with each other?

We saw the recent launch of Samsung’s Smart Home Service, which is a Samsung platform for controlling appliances that include a refrigerator, a washing machine and a TV.  The controlling app is available on Android. The problem of course is that this is a closed system and the app only works with Samsung appliances, and specific models at that (i.e., the Samsung Smart French Door Refrigerator and the Samsung Smart Front Loading Washing Machine).

This might work if you wanted all of your appliances in your home to be Samsung. As powerful as Samsung is becoming in home appliances, I’m not so sure that they could sew up the home appliance market to the point that they’d be a leader in everything from lighting to dishwashers to security. Needing a separate app to control these individual home appliances is, well, annoying.

So what gives? The AllSeen Alliance is attempting to create protocols to allow differing products to talk to each other. Many companies, like LG, Sharp, Cisco, and HTC have signed on. Not shockingly, Samsung and Apple’s names are absent from the list.

My bet is that this situation will be different than what companies like Samsung and Apple have experienced before since closing out communications with so much hardware will make them vulnerable to another platform finding its way into the home. I wouldn’t be shocked if we wind up seeing an Android like entrant that isn’t concerned about selling hardware, while providing a decent platform that can be monetized in other ways.

Others have pointed out that the Smart Home will force Apple’s hand and for the first time the company will have to allow a number of companies to develop hardware that plays well with iOS in the home. At Apple’s developer conference yesterday Apple’s Craig Federighi, who oversees iOS and OS X, introduced HomeKit, a common network protocol that will aid iOS developers in using the iPhone to securely pair, control individual devices and employ siri integration in communicating with smart home devices like locks and thermostats. It’s a part of Apple’s new SDK that has Apple working with many partners, like Philips Lighting.

In a world where hardware is the new internet, there’s unlikely to be much room for companies that try and shut that connectivity down. As I think of the failures in closed deck platforms (I’m recalling Verizon VCast right now), I’m aware that early attempts on closed platforms often occur because companies are misguided about the realities of what the consumer will actually pay for, what value is actually being created for consumers, or the standards and interoperability are not firmly codified.

That narrow thinking where a company produces a closed platform and maps out the monetization strategy is unlikely to work this time. The sole exception might be companies like Nest where the single product has such overwhelming value (a  significant reduction in energy consumption) and is so well designed, that consumers don’t worry about connecting it with other devices. This has been the typical Apple strategy, which Nest founder Tony Fadell knows well from his years designing the iPod.

But in the smart home where there’s a sea of diverse hardware and the value itself is interoperability, this is unlikely to work. Apple’s Federighi noted that the company believes it “could bring some rationality to the space.”  While Apple tipping its toes in the water with Homekit is unlikely to solve this problem entirely, the risk of fragmentation in the connected home is real and even Apple realizes that the company that can unify diverse devices is the company that wins.