This presentation to the IEEE Computer Society examines new and disruptive developments in the technologies used in homes, commercial buildings, and manufacturing lines to control lighting, HVAC, security, entertainment, appliances, and other devices. It summarized a market research report written for Parks Associates that also examined market drivers and remaining challenges while providing forecasts, company profiles, and descriptions of each of the enabling standards.

1. Home & Building Automation & Controls Finally ready for the Mass Market? by Wayne Caswell [email_address] A presentation for the IEEE based on a report by: © 2006 CAZITech Consulting C O N S U L T I N G

2. LightFair ISC NFPA COMDEX NSCA Training Sales ASHRAE AHR Expo FMA WEEC Lighting Access CCTV Fire Networks Wireless Telecom PA Video Audio Vendors EIB BACnet HVAC FM Energy Security Building Mgt IT http://www.automatedbuildings.com/news/ mar03/articles/builconn/bcon.htm Building Systems Sub-industries Life Safety LonWorld Retail Hospitals Schools LonWorks Verticals C O N S U L T I N G

3. Lighting PC Network Internet Access Phone Audio Video Security Irrigation HVAC Energy Information Comfort, Convenience, Security Entertainment Digital Home Applications C O N S U L T I N G

5. Source: Parks Associates’ Research © 2004 Parks Associates 68 1970 72 74 76 78 1980 82 84 86 88 1990 92 94 96 98 2000 02 04 06 08 68 1970 72 74 76 78 1980 82 84 86 88 1990 92 94 96 98 2000 02 04 06 08 Relative Market Size ECHO IV ECHO IV X - 10 X - 10 CEBus kicks off CEBus kicks off Echelon founded Echelon founded Firewire invented Firewire invented HomeRF WG founded HomeRF WG founded Japan’s HomeBus Japan’s HomeBus 802.11 WG founded 802.11 WG founded CEBus IS - 60 standard CEBus IS - 60 standard IEEE 1394 std IEEE 1394 std LonWorks EIA - 709 std LonWorks EIA - 709 std HPnP begun HPnP begun DAVIC formed DAVIC formed VESA HNC formed VESA HNC formed CEBus EIA - 600 std CEBus EIA - 600 std HomePNA founded HomePNA founded HomeRF 1.0 HomeRF 1.0 802.11b, 802.11a 802.11b, 802.11a HomePlug 1.0 HomePlug 1.0 DOCSIS 1.0 DOCSIS 1.0 802.11g 802.11g Bluetooth Bluetooth OSGi OSGi HomeRF 2.0 HomeRF 2.0 HomeRF ENDS HomeRF ENDS CEBus ENDS CEBus ENDS HomePNA 2.0 HomePNA 2.0 SCP ENDS SCP ENDS HPnP ENDS HPnP ENDS HPNA 3.0 HPNA 3.0 802.11n 802.11n 802.11e 802.11e 802.11i 802.11i UWB UWB UPnP UPnP Zigbee Zigbee HomePlug BPL HomePlug BPL Z - Wave Z - Wave Insteon Insteon DOCSIS 2.0 DOCSIS 2.0 Powerline Wireless Phoneline 30-year Digital Home Technology Timeline 68 1970 72 74 76 78 1980 82 84 86 88 1990 92 94 96 98 2000 02 04 06 08 ECHO IV X - 10 CEBus kicks off Echelon founded Firewire invented HomeRF WG founded Japan’s HomeBus 802.11 WG founded CEBus IS - 60 standard IEEE 1394 std LonWorks EIA - 709 std HPnP begun DAVIC formed VESA HNC formed CEBus EIA - 600 std HomePNA founded HomeRF 1.0 802.11b, 802.11a HomePlug 1.0 DOCSIS 1.0 802.11g Bluetooth OSGi HomeRF 2.0 HomeRF ENDS CEBus ENDS HomePNA 2.0 SCP ENDS HPnP ENDS HPNA 3.0 802.11n 802.11e 802.11i UWB UPnP Zigbee HomePlug BPL Z - Wave Insteon DOCSIS 2.0 C O N S U L T I N G

6. Early Adopters Innovators Early Majority Late Majority Laggards Source: Crossing the Chasm , by Geoffrey Moore Enthusiasts try any new technology Visionaries seek competitive advantage through revolutionary breakthrough Pragmatics want evolutionary change and “safe” choices Conservatives avoid risk and are price sensitive Skeptics maintain the status quo CHASM A Wide CHASM separates Today’s Home Controls Niche from Mass Market Growth Mass Market Households vs. High-end New Homes

7. Mass Market Households vs. High-end New Homes C O N S U L T I N G 68 K New Homes sold in 2003 worth >$500K New Home Construction 2002 New Home Value >$500,000 New Homes Valued at $500,000+ are just 0.065% of the Total Opportunity. 1.33 M New Homes 1.33 M New Homes Sold in 2003 Total U.S. Housing Market (#M) New Home Construction 2002 Source: U.S. Department of Commerce, National Association of Home Builders 105.5 M Occupied U.S. Households (2000 Census) 2/3 Owned 1/3 Rental

8. PC, Internet & Home Network Penetration (Millions of U.S. Households) ~76M ~71M ~39M ~23M Broadband Households (#M) C O N S U L T I N G

10. Source: Parks Associates 2004 Builder Survey © Parks Associates Technology Amenities Offered & Installed C O N S U L T I N G

11. Entertainment Amenities Offered & Installed Source: Parks Associates 2004 Builder Survey © Parks Associates C O N S U L T I N G

13. Households w/ Structured Wiring So, only about 1/3 can use Ethernet ~23M Home Networks C O N S U L T I N G

14. Do-it-yourself Data Voice Appliances Entertainment X10 Builder- Installed Custom- Installed Control & Security HAI Niles AMX Crestron Lutron Application Silos Level of Sophistication (installation, support, cost) Source: CAZITech & Parks Associates Industrial & Commercial Home Controls & Automation Market Segmentation C O N S U L T I N G

15. Home Controls & Automation Market Drivers 1. Embedded Processors , Sensors & Actuators 2. Digital Convergence : Media, Devices & Disciplines 3. Standards that Scale & attract Big Players C O N S U L T I N G

17. 1. Embedded Processors, Sensors & Actuators More Computing Performance at Less Cost (Embedded processors in Everything with a Digital Heartbeat) LINEAR SCALE PERFORMANCE C O S T PERFORMANCE COST C O N S U L T I N G TIME

18. 1. Embedded Processors, Sensors & Actuators PERFORMANCE COST PERFORMANCE C O S T More Computing Performance at Less Cost (Embedded processors in Everything with a Digital Heartbeat) LOGARITHMIC SCALE C O N S U L T I N G TIME

19. 1. Embedded Processors, Sensors & Actuators Intel processors over Time, showing the effect of Moore's Law 0.1 1 10 100 1,000 10,000 100,000 1984 1987 1991 1995 1997 1999 2002 2004 2008 Source: Intel Performance (MIPS) $0.01 $0.10 $1.00 $10.00 $100.00 $1,000.00 Cost ($ per MIPS) Performance (MIPS) Cost ($/MIPS) Note the Logarithmic Scale 8088, 4.77 MHz 0.03M transistors 80286, 12 MHz 0.1M transistors 32-bit 386, 20 MHz 0.2M transistors 486DX2, 66 MHz 1.2M transistors Pentium, 100 MHz 3.1M transistors Pentium 4, 3.2 GHz 50M transistors 1981 Pentium II, 1 GHz 20M transistors Pentium Pro, 200 MGHz 5.5M transistors C O N S U L T I N G

20. 1. Embedded Processors, Sensors & Actuators Security System Photocell Night - light Whirlpool Tub GFI Plug Hair Dryer Garage Door Opener Air Conditioner Irrigation VCR, DVD, Cable Box, … Coffee Pot Toaster Microwave Oven Answering Machine Alarm Clock Motion Sensor Light Baby Cam © 2004 Parks Associates © 2004 Parks Associates C O N S U L T I N G TV

22. Lighting PC Network Internet Access Phone Audio Video Security Irrigation HVAC Energy Data N/W Home Mgt. Multimedia 2. Digital Convergence: In the Home Comm. CONTROL & AUTOMATION C O N S U L T I N G

23. Data Voice Appliances Entertainment Control & Security Industrial & Commercial Do-it-yourself Custom- Installed New Technologies move Up- Application Integration IP-based Standards (reliable, scalable, affordable) Ethernet 10/100/1000-base-T HomePlug, UPB Insteon Wi-Fi BOM = $14 (2006 MIMO) ZigBee Z-Wave MoCA w/ Sensors & Actuators Source: CAZITech, Parks Associates & IDC 3. Standards that Scale blur Market Segmentation and Down-Market C O N S U L T I N G

25. 3. Standards that Scale attract Big Players

26. Standards & Technologies that impact Home Control

27. Standards & Technologies that impact Home Control

28. Powerline Standards for Home Networking & Controls See also: http://en.wikipedia.org/wiki/Power_line_communication FEATURE X-10 UPB LonWorks HomePlug AV Insteon Devices 256 >62K >32K >16M Cost (lamp mod.) $12 lamp $75 lamp $35 $30 lamp Reliability 1-way 2-way 2-way 2-way Speed 1-3 sec. 0.3 sec. 85-200 Mbps 0.04 sec. Range 150’ 75’ 4,000’ n*150’ Compatibility de facto Proprietary ANSI/EIA709 X-10 Function

30. 0.1 Mbps 1 Mbps 10 Mbps 100+ Mbps Throughput 10m 100m 1,000m 10,000+m Range Vehicular Nomadic Stationary Wireless Positioning (Relative Measures on Logarithmic Scale) 802.20 802.16e 802.15.1 (Bluetooth) 802.15.4 (ZigBee, UWB Lite) Z-Wave 802.16a (WiMAX) 3G Cellular 2/2.5G Cellular 802.15.3 (UWB) 802.11 (Wi-Fi) C O N S U L T I N G

31. Wireless Standards for Home Networking & Controls Remote Control of A/V Equipment or Media Center PC Remote Control of Surveillance Equipment

32. Wireless Standards for Home Networking & Controls Crestron Niles TS1 (~$500) Philips Pronto Remote Control S/W for existing PDA CorAccess Amigo Sony VAIO VGN-U50 AMX Modero

33. Mesh Networking Source: C O N S U L T I N G

34. Mesh Networking Source: C O N S U L T I N G

35. Mesh Networking Self Configuring Source: C O N S U L T I N G

36. Mesh Networking Source: C O N S U L T I N G

37. Mesh Networking Self Healing Source: C O N S U L T I N G

38. PAN coordinator End Device Network Topologies ZigBee & Z-Wave C O N S U L T I N G Cluster Tree Mesh Star

39. PAN coordinator End Device Bridging Clusters >10,000 Devices (254 * 255 ) 254 Devices 254 Devices 254 Devices C O N S U L T I N G

40. Wireless Standards for Home Control Applications FEATURE ZigBee Z-Wave INSTEON Devices >64K (254*255) 255 per controller 16.7 M Cost / Availability None yet Zensys ~$1 chip set Home Depot, Lowes ~$2 chip set $35 lamp module Battery Life Low Power Low Power Low Power Frequency 868/915 MHz (EU/NA) 2.4 GHz (WW) 868/908 MHz (EU/NA) 868/915 MHz (EU/NA) 131/120 KHz (PLC) Speed 40-250 Kbps 9.6-40 Kbps 10 messages/sec Range ~150’ ~150’ ~150’ Compatibility IEEE 802.15.4 Proprietary Proprietary, X-10 Topology Routed Mesh/Star Supervised Routed Mesh/Star Supervised Peer-to-Peer Mesh Non-supervised C O N S U L T I N G

41. Conclusions The Consumer’s Cultural Lag Technology Innovation Curve What we are confronted with © 2004 Parks Associates C O N S U L T I N G Consumer Adoption Curve Cultural lag What we are able to take in

44. Wayne Caswell [email_address] 512-507-6011 After retiring from IBM, Wayne Caswell founded CAZITech Consulting and co-founded Homeowners of Texas, a nonprofit consumer advocacy. He is known as a Technical Marketing Strategist, Futurist, and Consumer Advocate. With some 40 years of experience, Wayne is now older and wiser but still enthusiastic and physically fit. He keeps learning new things and pushing new boundaries and is currently studying the intersections of dozens of MiniTrends, looking for innovative companies with a promising future and a corporate culture he can support and believe in. © 2006 CAZITech Consulting C O N S U L T I N G