Smart Homes – The View from Berlin (And some answers to Life’s Enigmas)

This blog was written by BSRIA's Henry Lawson

This blog was written by BSRIA’s Henry Lawson

For decades, mankind has agonised over such worrying conundrums as whether the fridge light goes out when the door is closed, or whether I need to drive 20 miles home to check that I really did turn the iron off. (I plead guilty to the latter).

If the 2016 IFA Messe in Berlin, which finished on 7th September, is anything to go by, then these dilemmas will soon be a thing of the past. Not only will I be able to log into my iron from the other side of the world, but a web cam will allow me to check the contents of my fridge, and potentially even the status of the food.

For a long time the idea of smart appliances has seemed almost whimsical, the domain of the geek or the obsessive with surplus money on their hands. The more serious message from IFA is firstly that most of the major quality appliance manufacturers, in both Europe and Asia Pacific are starting to make serious investments in smart appliances. Of course this investment does not prove that the demand will grow to match it. This will depend just as much on a second clear trend, namely that smart appliances are starting to interact with wider home management systems in a way that can potentially change the whole way that households operate, and revolutionise day to day domestic life.

To take a simple example; in the UK there is a lot of talk about shifting tasks that are not time-critical to off-peak times when energy is cheaper. But this mostly hangs upon smart meters. In Germany there has been a lot of resistance to smart meters (especially on data protection grounds), but the country is a world leader in domestically generated solar power. Several of the leading ‘white goods’ manufacturers, including Siemens, Miele and Bosch have partnered with SMA, the country’s leading supplier of residential solar power and storage systems. Your wash can now be kicked off automatically when there is enough solar power to drive it thus saving both  money and CO2 emissions.

From intelligent fridges to robots to keep an eye on grandma; the smart future is emerging

From intelligent fridges to robots to keep an eye on grandma; the smart future is emerging

Specialised smart systems are also increasingly being integrated into wider smart home systems, with a combination of open standards and a “best of breed” approach. This allows you not just to invest in one of the market-leading smart lighting systems, but also, for example to use it to changing the light settings to suggest that the building is occupied.  Home security is a huge theme in Germany, where burglary rates have actually been rising over the past couple of years. Another smart home system can use top of the range entertainment sound systems to mimic sounds like hoovering – with the added bonus that you can now also annoy the neighbours even when you are on holiday.

One flip-side of this is a degree of potential complexity, and many vendors are aware that systems that are complex to install, program and to manage are incompatible with a true mass market. Accordingly many now offer voice-command systems most commonly using Apple Siri or Amazon Alexa. Some suppliers also offer a degree of “machine learning” based on the behaviour both of typical users and of the actual householder.

Another key trend that BSRIA has also picked up over recent years is that much of the higher-end smart home market overlaps with the light-commercial market. A luxury home and a small office may have many similar requirements in terms of lighting security and energy requirements, and the owners may be willing to make the investment. KNX has a huge presence in this market.

On the other hand, the mass market will only be conquered by systems that are relatively low cost, and simple to install, either by the owners themselves or by an ordinary non specialist electrician. One supplier, Datastrom, makes use of mains electricity wiring to connect and control devices, so can be installed by an electrician. Others deploy low- power devices which can be battery powered and can communicate wirelessly using a low energy protocol such as Z-wave. This also makes the smart home relatively portable, which is an attraction in a country like Germany  where far more people rent their homes than do in the UK or the USA.

Smart technology - light in the tunnel, not just at the end of it.

Smart technology – light in the tunnel, not just at the end of it.

I came away from IFA with a confirmation that a dynamic smart home market is taking shape as part of the massive expansion in smart technology and the Internet of Things. There remain huge question-marks. While there is almost universal awareness that cybersecurity is an issue, and much is being invested in it, it is not yet clear that there is an effective way of keeping all devices secure at all times. In fact this concern could drive the move towards complete smart homes, as it is probably easier to monitor a network of IoT devices for ‘suspicious behaviour’ than to try to protect and update each one individually on a continual basis.

BSRIA will be shortly be publishing a series of studies on each of the Smart Homes and Light Commercial markets in Germany, France, UK, the Netherlands  and on North America, which will explore all this, and much more.

For more information please feel free to contact me, Henry.Lawson@bsria.co.uk – +44 (0)1344 465 590

The return of Athens and Sparta, or the Rise of the Corporate State?

This blog was written by BSRIA's Henry Lawson

This blog was written by BSRIA’s Henry Lawson

For those of us who have been following the development of smart cities and smart government over the past few years, it has become more and more obvious that it is not only, perhaps not even mainly about the rapid advances in smart technology and the IoT. It is also about the social and political underpinning, who will control the developments and how far they will be allowed to go.

Recently we have seen a few useful straws in the wind. Last month, as some of you may have already noticed, the UK voted, by a narrow but decisive majority to leave the European Union. This will be the first time in its almost 60 years that the EU has contracted rather than expanded, and moreover losing its second biggest economy.

Partly in direct consequence, there is now a distinct possibility that Scotland in turn will leave the UK, which would leave the UK barely half the size physically than it was less than a century ago (prior to the secession of most of the island of Ireland). What is much less noted is how much more fragmented the world as a whole has become.

A century ago Europe was dominated by a few empires. Now, following the disintegration of the Soviet Union and the threatened fraying of the EU, there are a whole swathe of countries that either never knew an independent existence before or did so only transiently, especially in Eastern Europe. From Ukraine, Moldova and Belarus, to Croatia and Montenegro, Scotland could potentially re-emerge after 300 years followed perhaps by Catalonia. In the world as a whole there are almost 200 countries that can claim some degree of independence, and many more seeking it.

What has this to do with the way the smart world is organised? Quite a lot, actually. Evidence suggests that one of the things many people in the UK were voting “against’ was the power of global corporate forces that are moulding our lives, with Brussels seen as their eager collaborator. I Personally take a rather different view, that it is precisely corporate power, which is being reinforced by technological advances that means that if something like the EU did not exist, we would need to invent it, or perhaps more accurately, we need something that moves on from the original vision of the EU to reflect the more complex world that we are now moving into.

Business of course already operates on a global scale. The world’s most valuable corporation, Walmart – which let us not forget, also owns one of the UK’s leading supermarkets, would if it were a country, rank 26th in the world, just behind Belgium, and indeed ahead of 2/3 of the members of the current EU. If we focus in more on direct players in smart technology, Apple would rank 44th, putting it on a level with such a technologically sophisticated country as Finland. And Microsoft, which now only just makes it into the world’s top 50 corporations, makes more money than any of the 10 smallest EU members.

It seems obvious to me that, if such corporations are not to be dominating political decisions, as well as the technology, then a degree of cooperation between governments is needed, something possibly very like the EU, which has at least forced corporates like Google and Microsoft to sit up and take notice.

Another fascinating trend, that takes us perhaps in a slightly different direction, is the fact that so many of the world’s richest and most technologically advanced countries are in fact city states, or something very like it. According to the IMF, the top 10 countries with the highest per capita GDP, included six oil producers (no surprise there),  but also four that could be described as “city states” or something like it, namely Luxembourg, Singapore, San Marino and Hong Kong  – taken separately from the rest of China.

Now of course very small states have the option to attract business through tax incentives that are widely seen as underhand, in a way that simply is not feasible for larger countries. But what is also interesting is that both Singapore and Luxembourg have been to the fore in global smart city developments. There are clearly advantages where a government can focus on the needs of a city and its immediate surroundings and needs. Even in larger countries, cities and their regions are being accorded more power, or are demanding this.

And of course this is not a new trend. You can travel northern Europe, from Flanders to the Baltic States, and admire handsome cities that grew rich as part of the Hanseatic League, essentially a league of cities that dominated much of northern Europe’s trade for several centuries from the late middle ages onwards. Before that, the first major flowering of European civilisation, with huge leaps in philosophical and scientific understanding occurred in a scattering of Greek city states. And of course the discoveries, inventions and creativity of the Renaissance was cradled by Italian city states from Florence and Pisa to Venice and Mantua.

Linked to this, it perhaps tells us something that by and large, the UK’s biggest cities voted very differently in the EU referendum to the small towns and countryside, reflecting a different attitude. There’s a case for saying that Londoners, Parisians and Amsterdamers have more in common with each other in some ways than with their own hinterlands.

Could politics and technology therefore be moving us away from the old fashioned nation state, and perhaps away from massive continental alliances like the current incarnation of the EU, but towards alliances between small states and cities that have common interests and a common culture to protect?

One thing seems clear to me; if we want a future whether the major technology providers work for us, rather than one where we for them, then we need a major shake-up in the way the world is managed.

Have you been blackmailed by your Dishwasher? Who Owns the Smart Future?

This blog was written by BSRIA's Henry Lawson

This blog was written by BSRIA’s Henry Lawson

Having recently updated BSRIA’s key market studies on Building Automation Controls (BACS), Building Energy Management (BEMS) and Smart Evolution – towards the Internet of Everything, I was struck by a world in a state of flux with  implications for the built environment and technology in general that could be as profound as they are unpredictable.

The structure and make up of our buildings and cities have always been intensely political. The most visible of all human creations, they speak volumes about our abilities, our status and our values and our aspirations. I felt this last month  when viewing the ruins of Ephesus – once the second city of the Roman Empire –  as much as when  I am visiting London or Chicago.

At least since the turn of the millennium there has been a tacit assumption that while technology is the great enabler, much of the change in the way our buildings and cities are designed and organised will be driven by social concerns, typically expressed through politics. In particular, the perception that the threat of climate change requires far reaching action has led to a sustained series of targets, guidelines and regulations to increase both energy efficiency and the use of renewable energy, which naturally impacts on the built environment as one of the biggest consumers of energy.

Is this movement losing momentum? The financial crisis and recession affecting much of Europe, North America and some other parts of the developing world has proved to be the most prolonged since the 1930s. Even countries which appeared to escape the worst impact have since experienced either recession or a dramatic slowdown, including Australia, Canada and of course China.

With falling or stagnating production and rising government debt levels in so many countries, it is no surprise that finances and basic economics have come to the fore. Violent conflicts, especially in the Middle East, Africa  and Eastern Europe, but overflowing into other parts of the world, and in turn fuelling mass movements of refugees and economic migration are also seizing attention in developed countries as well.

All of this has sometimes appeared to leave the “green agenda” somewhat on the back foot. Even in countries like Germany, Austria, Australia and New Zealand, where Green parties have attracted mass support and had a major influence on government, they have seemed to become more marginalised. Britain’s recent elections resulted in a new majority government which has very quickly moved to relax requirements on the energy efficiency of new buildings, and also to phase out subsidies for wind power.

While there is argument as to how far this is simply a question of means, and how much it represents a shift in priorities, there is little doubt that measures to improve energy efficiency or to promote use of smart technology face an uphill path if they cannot also provide a quick pay-back.

Where governments get involved in technology, it tends to be for old fashioned economic reasons.  When  mega-corporations  like Microsoft, Apple, Google and Amazon have been in the spotlight it has mainly been because of accusations of anti-competitive practices or because of their tax policies. Rather less thought has been given to the ways in which companies like these could change the basic structure of society, the balance of power, and the whole environment.

Increasingly these global brands interact directly with a global audience, influencing their behaviour, and in turn being influenced by them. It is no accident that Microsoft, Apple, Google and Amazon, having established themselves as consumer brands, are now all active in the area of smart buildings, ranging from the smart home to, in Microsoft’s case, providing the data crunching to manage and optimise whole campuses of buildings.

Increasingly we can link these to wearable devices and to creators of virtual realities which could radically change our day to day activities and environment. Even the basic blocks  from which buildings are made can have ‘smart’ properties, from ‘self-healing’ bricks to glass that responds dynamically to different levels of light.

threatsWith artificial intelligence already surpassing human intelligence in certain well defined areas – such as chess playing – questions are raised about how far the technology goes, who owns it, and how much power they will have. Even our homes and offices can study, learn and predict our habits and our preferences, in ways that can certainly be useful, but also potentially disturbing.

For over a hundred years there have been fears about the prospect of vital areas of technology  being dominated by a single concern or perhaps a cabal of companies. So far, in practice, it has been innovation itself  that has come to the rescue. Even the most nimble footed technology giants have been caught off-guard by new waves of technology, from IBM, to Microsoft to Nokia. In the case of building technologies the requirements are particularly diverse, and  it is quite unusual to find a country where a single supplier accounts for more than 25%-30% of the market.

Nonetheless as we look to a future where corporations and, by implication, governments have access to information about almost every aspect of where we are, what we are doing, how we feel and what we want and fear.

While you can probably rest assured that your dishwasher probably doesn’t have a motivation to blackmail you (why were those extra glasses washed out at 3 o’clock last Thursday morning?) you can be less assured that it won’t soon have the evidence to do so.

More information about the latest editions of BSRIA’s market studies on Building Automation, Building Energy Management, and Smart Evolution is available here.

Should Building Managers worry about scary movies?

threatsBuilding managers thinking of films to see this winter may give some thought to a previously little known comedy largely set in North Korea.

The successful cyber-attacks on Sony, one of the world’s best known corporations, and which lives and breathes digital technology, resulted in the release of reams of sensitive information, and led  Sony to delay the opening of the film. All this may on the face of it have little to do with the nuts and bolts of building automation, but it does fire another warning shot across the industry’s bows.

We have known for some time that buildings are vulnerable to cyber-attack. Not only can they be major targets in themselves, but they often offer an easy “back” door” into an organisation’s wider IT network. The successful attack on Target stores in the USA gained access via the company’s HVAC system which in turn allowed them into the more lucrative customer data records. BSRIA research shows that, in the USA for example, over 90% of all larger buildings (i.e. those with more than half a million square feet of space – or c. 50,000 m2) have some kind of building automation and control system (BACS), and many are to some degree at risk.

What is striking is that in so many successful attacks on buildings or infrastructure the problem had less to do with the cyber-protection systems in place than with the way in which they were being maintained and operated. At Target, alerts were generated but not acted on until after much of the damage was done. The earlier attack on Google’s Australian offices in Sydney were linked to the fact that an older version of the Tridium platform was still in use.

Many organisations lack effective processes and procedures, which in turn is linked to the fact that, even within the same organisation, building services and IT tend still to work in separate, parallel worlds.

All of this is compounded by the fact that BACS systems increasingly have at least one foot in the Cloud, and often several. Almost all major suppliers of BACS and Building Energy Management Systems (BEMS) offer at least the option of cloud based analytics, and the ability to access and manage multiple buildings remotely is seen as almost a “must-have” – outside of industries which have traditionally been hypersensitive about security. The cloud brings huge technical, social and financial benefits, but also greatly increases risk, as does the general spread of IT based functionality through buildings and devices, a process that the ‘internet of things’ is set to expand exponentially.

Major suppliers of BACS systems are talking publically about ways of addressing the challenge, and companies like Lynxspring are establishing a reputation in this area. In the UK the Institute of Engineering and Technology (IET) issued a Code of Practice for Cyber Security in the Built Environment in November 2014.

This blog was written by BSRIA's Henry Lawson

This blog was written by BSRIA’s Henry Lawson

Cyber-attacks tend to be motivated by political, ideological, or financial motives, or by a combination of mischief and malice. On all these scores, major buildings remain vulnerable especially when they are associated with prominent organisations, whether private or public.

In the latest edition of BSRIA’s market briefing Threats / Opportunities for Building Automation Systems, we look further at the cyber threat and what is being done to counter it. The study also looks at other major trends that are changing the profile and prospects of building automation. These include the development of more intelligent HVAC systems, (whether Direct Expansion or VRF based), the growth of ‘smart homes’ solution which are also snapping at the heels of the BACS market at the “lower end” of commercial buildings, the growing importance of building analytics and big data, and the rise of potential new global players, especially in countries like China and India.

We will be following these and other emerging trends through the course of 2015. It should be as exciting anything that Hollywood has to offer, for rest assured: The cyber threat (and much else) is coming to a building near you soon.

 

Additional Sources:

http://techcrunch.com/2014/08/05/smart-buildings-expose-companies-to-a-new-kind-of-cyber-attack/

The Institute of Engineering and Technology (IET) guidelines.

http://www.theiet.org/resources/standards/cyber-cop.cfm

Global BEMS Market set to Approach $7 billion by 2020

This blog was written by BSRIA's Henry Lawson

This blog was written by BSRIA’s Henry Lawson

If I could point to a market which is already worth some $3.5 billion, or 3 billion Euros, and which is growing globally at well over 10% per annum, at a time when growth in building automation is a fraction of that, I suspect that many investors and industrialists would bite my hand off. This is the industry that we explore in BSRIA’s newly updated report BEMS Opportunities.

Even Europe, which currently accounts for almost half the current Building Energy Management Systems (BEMS) market, is growing at around 10%, while North America has been growing faster, and the rest of the world substantially faster still.

BSRIA forecasts that the global BEMS market will almost double, to more than $6.8 billion by the year 2020. This impressive growth is set to occur in spite of numerous obstacles and uncertainties. This is partly because the factors driving this growth differ from one region to another.

In Western Europe, gas prices almost doubled between 2005 and 2013, while at the same time major economies like Germany became increasingly dependent on import of gas from politically sensitive countries like Russia and the Gulf states, raising the spectre of uncertain supplies.

While the rise in electricity prices has been less dramatic, Germany faces the huge task of fulfilling its commitment to

henry dec2shut down all nuclear power generation by 2022, and the UK faces similar challenges as its ageing, coal-consuming and CO2-spewing power stations reach the ends of their lives, with the ghost of Christmas back-outs rising like a Dickensian spectre to haunt the business and political worlds.

This, and increasingly aggressive environmental targets, at national and EU level, mean that even a Europe which has been in or near recession for more than five years continues to invest in energy efficiency. At the same time, there are signs that organisations at all levels are beginning to understand the full potential of BEMS to save money while meeting obligations and improving the brand.

In North America, the pressure of energy prices has been less relentless, especially since fracking of shale gas has got underway. The movement towards environmental regulation has also been patchier – often varying at local and state level, and has faced more opposition. At the same time, the proportion of energy consumed by office buildings has been rising inexorably at a time when energy used in such areas as transport, industry and homes has been either stable or falling, placing office buildings firmly in the sights of those wishing to make savings. North America also benefits from the plethora of firms developing innovative energy management solutions in both the USA and Canada.

In the rest of the world the picture is extremely varied, from developed countries like Japan and Australia with widespread adoption of BEMS, to major emerging economies like China, where energy has hitherto been seen as rather less of a problem but where the pollution associated with fossil fuels is becoming more pressing.

This growth presents huge business opportunities but also as many gauntlets thrown down. The mainstream building automation suppliers are all active, unsurprisingly, given that the two are so genetically interlinked that building automation was originally widely referred to as building energy management. They can offer the benefit of relatively easy integration of energy management into the building’s wider functioning.

Against this, as virtually every device, appliance and component of a building becomes capable of generating and communicating data, the advent of big building data has opened huge opportunities both to enterprise data and IT suppliers and to an army of smaller newer suppliers of advanced analytics, allowing building managers to predict and pre-empt problems that degrade a building’s energy performance.

Some of these new entrants will fall by the wayside, especially given the level of overlap between many of the offerings, others will be ripe for take-over, but a few are likely to emerge as major disruptive players. In our report we identify the leaders and challengers, along with the niche players and some of the most likely acquisitions. As always, there is an implicit conflict between the move towards integration on the one hand and the desire for innovation on the other, and we look at some of the standards that are emerging to address this.

The prize is most likely to go to companies that can combine innovation in new technologies, and understanding of how a building’s occupants interact with the building, with a deep-seated understanding of how buildings function. This report should help to shine a light on who will be left holding a torch for others to follow if and when the lights really do threaten to go out.

This is the industry that we explore in BSRIA’s newly updated report BEMS Opportunities.

Smart Building Conference – The Human Factor

This blog was written by BSRIA's Henry Lawson

This blog was written by BSRIA’s Henry Lawson

On 7th October I attended the SmartBuilding Conference in central London, in the course of which we were treated to the views of a range of industry-experts including BSRIA’s own Jeremy Towler.  Like all worthwhile conferences, it presented a mixture of familiar messages being elaborated and reinforced – such as the all too frequent gap between the vision and the delivery of smart buildings, and the vital role of retrofit in a world where 80% of the buildings we will be using in 2050 have already been built, and some less familiar insights. These are some of the main points that I took away.

While we often talk, rather platitudinously about, buildings, or businesses being “all about people”, we spend less time thinking about what this really means in practice.  An often overlooked fact is that people’s statements of what they want is often a poor guide to how they will actually take to new technology. This is not just because we often lack the understanding and vision of what is possible (as in the famous Henry Ford quote that “What people ‘really wanted’ was not cars, but faster horses.”), but also because (as every psychologist knows) we are much less rational and consistent in our judgements than we like to think we are. This places a premium on observing how people actually use buildings and adapting them and, even more so, future buildings.

Effectively observing and responding to the way people use buildings has wider implications.  One speaker suggested that the general move from a product-based to a serviced-based approach (as exemplified by cloud based solutions and the increasing tendency to lease equipment and facilities) is likely to penetrate from the “easy hits” to the more general areas of building services and smart technology, even potentially to the concept of a “building as a service”, where those who design and construct and configure the building are also those responsible for running it, helping to combat a problem where a building is designed supposedly to be smart, by people who then walk away having handed it to a completely different group, resulting in a loss of understanding, continuity and accountability.

Having buildings that genuinely learn and evolve in response to users’ changing needs over time calls for flexible and adaptable approach to design and construction so that they can cope better with changing needs. One way of achieving this is by using more modular construction techniques, which can at the same time reduce construction costs. Project Frog which has been responsible for a number of modular buildings in the USA was cited as an example of this.

Where an end-to-end approach is lacking, smart technology is too often a late add-on which means that it is not fundamentally designed into the building, and that those implementing it lack a connection with the original concept.

With IT increasingly at the heart of buildings, IT departments need to be involved from the early stages, and if engaged correctly they can help identify and address problems, including some of the most potentially serious challenges such as building cyber security.  Too many organisations still see IT and Facilities Management as separate disciplines to be kept siloed.  This can lead to failures of communication, and worst case, to actual conflicts.
There was also a lot of discussion of the role of more specific types of technology. For example, wireless technology is recognised as a useful backup, and for fixes to problems where the building can’t easily be rewired (historic buildings come to mind here) or where a ‘cheap and cheerful’ solution is sought, but is unlikely to become reliable enough for critical services, owing to fundamental problems of potential interference and obstructions which can arise unpredictably. This reminds us that “You cannae change the laws of physics” is a maxim that extends well beyond grainy back-editions of Star Trek.

There was much discussion of the way in which companies that have not traditionally been thought of as buildings- related, even in the most technological way. BSRIA research has already identified how IT companies like IBM and Microsoft are starting to make an impact in the world of smart buildings, now joined by Google and Apple, especially at the residential end of the market. This raises intriguing questions. On the one hand these companies bring not only deep knowledge of key areas of IT, especially in processing ‘big data’, on the other they  also have massive financial resources and proven commercial acumen, which could help to spearhead and open up  new markets.

However there are also fears that the delivery model typically deployed by companies like Google and Apple may not lend themselves to the more complex demands of building management. Simply buying a “smart home kit” from an Apple or DIY store is unlikely in itself to give you the hoped-for results in terms of improved energy efficiency, comfort and security. This could even lead to a consumer backlash that sets back the technology. There was a consensus that consumers will need experts who can provide advice and also ensure that systems are properly implemented. This in turn requires a range of skills broader than the “traditional” electrician, plumber, heating engineer or security engineer.

We were reminded that major disruptive technologies are normally led by new entrants into the field, posing a challenge to the major established players. Indeed it seems quite likely to me that the companies that are leading the field in 20 years’ time could well be ones that most of us haven’t heard of, or which don’t yet exist.

I left the conference slightly haunted by one further thought: We heard a lot about how buildings must learn and adapt to their users’ actual needs and behaviour. This led me to wonder how far this change, if it emerges and it surely will, will in turn change actual human behaviour.

Since our ancestors emerged from the forests and savannah thousands of years ago, humans have gradually been losing the need to be acutely aware of the physical world around them. First there was the loss of contact with the wilderness, and nature “red in tooth and claw”. Then the industrial revolution alienated us increasingly from the basic processes of producing food and the physical manipulation of nature.

Smart conferenceThe electronic revolutions mean that we need to understand less and less about the way that for example, our cars or heating systems or computers operate and indeed we meddle with them at our peril.

If even buildings and cities come to observe, know and “understand” us and anticipate our actions, will humans then become, physically at least, almost wholly reliant on outside intelligence, and end up, in effect almost leading an artificially controlled ‘virtual’ existence, and what role will human intelligence then play as opposed to artificial intelligence?

This might seem far-fetched, but big changes often tend to occur much faster than anticipated, and often, far from being incremental, can depend on sudden tipping points. There are also of course  formidable barriers, not least the public reaction to the prodigious level of data sharing that would be needed to make all of this even remotely possible.

Nonetheless, I for one find it intriguing that the development of the smart building could just be part of the gradual emergence of a new “breed” of human, in terms of what they think and more importantly how they interact with the world.  Could we be seeing the emergence of a kind of “virtual man” where the boundaries between the human and the buildings, vehicles and cities we use and inhabit are hopelessly blurred?

Building services now look more exciting today and indeed  look closer to science fiction than could have been imagined when BSRIA started out 59 years ago.

Building Controls: Throwing a BRIC in the Works

Henry BlogThe BRIC countries; Brazil, Russia, India and China feature prominently in the news on an almost daily basis, for all sorts of reasons. While there have been concerns over a slowdown in growth, China, India and Brazil have all continued to grow through the recession at substantially faster rates than most of the developed world, and whilst the somewhat reduced growth rates may cause alarm in China and India, they would be cause for wild celebration in, say, much of Europe.

China, Brazil, Russia  and India all now rank in the World’s top 10 economies, and China is already second only to the USA, and is poised  to overtake it sometime in the next few years.

This economic development has naturally been associated with a lot of building development, including demand for such systems as HVAC and Building Automation. Nonetheless, in the BRICS countries the Building Controls markets have tended to lag behind their economic development.

Hence, according to BSRIA research, China’s Building Automating market was the world’s 5th largest in 2012, while Russia ranked 11th, India 16th and Brazil 18th.

What is more, the same research shows that the Chinese, Indian and Brazilian markets were dominated by the “Big 4” global suppliers: Siemens, Johnson Controls, Honeywell and Schneider Electric, even though the individual company shares varied reflecting local market conditions.

One thing that the history of the past 150 years has taught us is that as technologies mature and economies develop, industries tend to migrate to areas which offer the combination of lower costs and growing markets which China, India and Brazil are all in a position to do. This has been seen with the massive movement of manufacturing industry to China and of IT related industries and services to India. This in turn has created some new locally owned corporations with major industrial and financial clout, in a position to compete and invest on a global basis.

The latest update to BSRIA’s global study Challenges and Opportunities in the BACS Market , looks at a number of key trends, including the potential for new challengers to emerge in China, India and Brazil.

Unsurprisingly, the process appears to be most advanced in China. Spurred on by the wave of new construction, suppliers such as Techcon, SUPCON, Beston and RUNPAQ have started to make a real impact covering most of the main vertical markets, and including some high profile projects.

In India, where the overall market is significantly smaller, only Larsen and Toubrou, a major Indian-owned global corporation, stands out. There are however a host of Indian companies providing implementation and integration services.

This blog was written by BSRIA's Henry Lawson

This blog was written by BSRIA’s Henry Lawson

In Brazil a major domestic supplier has yet to emerge, though as in India there are a range of local companies offering related services.

In Russia, local Champions such as Regin and Polar Bear have gained a significant national market share, but have yet to have much impact elsewhere.

Past experience in other industries suggest that these countries may well provide favourable conditions for local champions to emerge and that, as their national BACS markets grow and mature, so this could even provide a springboard to offer products and services on a regional or even a global basis. This is definitely an area that everyone with an interest in Building automation, be it as a supplier, customer or service provider, should continue to watch going forward.

Other subjects that we focus on in the latest update include Technical Infrastructure Support Providers, developments in cybersecurity for buildings, and new alliances and mergers.

To find out more about Challenges and Opportunities in the BACS Market please contact Steve Turner – Steve.Turner@bsria.co.uk

Who Will Rule the Smart New World?

While Analysts’ predictions of the next big developments in Technology have become as much a January tradition as are hangovers and the task of hoovering pine needles from the carpet, it is often even more illuminating to look at what is actually happening, but which may be “hidden in plain view”.

Henry latest

While BSRIA has been reporting on and working with developments in building technology for decades, two recent trends have become clear:

  • The pace of development is accelerating, as buildings move increasingly into the IT mainstream, with elements such as software becoming as important as the more ‘traditional’ electronic and mechanical aspects.
  • Other areas of smart technology are not only developing apace, but are converging, in ways that are both predictable and perhaps more surprising.

Already smart technology is ubiquitous and affordable enough to influence every area of life from home and leisure to commercial premises to infrastructure and the most basic processes used to run cities and the governments of whole countries.

Whether it is using a smart phone to adjust your home heating or to pay your local taxes, or a smart meter to indicate the cheapest time to run a load through a smart washing machine, or smart glass that lightens or darkens in response to ‘instructions’ from a building, or smart cars communicating with traffic signals, we are seeing technologies that we have always thought of as independent interact, as the Internet of Things steadily expands to becomes the Internet of Everything.

This interaction is not only convenient; it also means that the same goals can be pursued simultaneously using different smart systems. To take one example, if we want to reduce greenhouse gases, we can use smarter and more energy efficient devices and appliances, we can manage the energy consumption of our home or office through building controls (or even by using smarter building materials), or wider society can invest in smarter grids and smarter sources of energy production. The balance of the mix that brings the best result can change depending on the situation, so they need to be interconnected.

All of this opens up huge potential opportunities for companies to emerge as leaders in the smart new world. Some of the leading automation companies are already well established here. But other sometimes surprising challengers are emerging. As information and analysis becomes more central to the smart world, including the smart built world, so software and IT services companies are seeing and seizing opportunities, and other companies are also branching out.

While the “smart homes” market may initially have been slower to take off than some expected, it is telling that Honda entered the market in 2013, and Google followed, with its acquisition of  Nest Laboratories in January 2014.

Of course growth by acquisition is not in itself enough. The much more challenging task is integrating diverse offerings into a single seamless and coordinated whole. Here the advantage will go to those companies who can develop solutions that naturally fit together, and who also understand how to develop and market them in a coordinated and holistic way.

Equally, the smart new world will rest not just on technological ingenuity and innovation. Equally important will be the understanding of the world of organisations – from private companies to governments, and on the behaviour of individuals. Each of these will interact and influence the other, often in unintended and unpredictable ways. The larger the scale of the system, the more complex and unpredictable it becomes. (It is telling that it is huge projects which interact both with governments and with a myriad of individuals that are especially liable to go wrong, as witness the debacle over the roll-out of the computerised elements of the new American Health Care system – ‘Obamacare’).

The companies that do best in this environment will need to offer the soft skills, including the social, the psychological and the political, in order to prevail.

BSRIA has just published a major new Market Study Smart Evolution 2014: Convergence of Smart Technologies: Towards The Internet of Everything which considers these questions and much more, and identifies the companies who are currently best placed, and those who are set to emerge as challengers.

This blog was written by BSRIA's Henry Lawson

This blog was written by BSRIA’s Henry Lawson

It is a new world that sometimes appears as through a looking glass. As Lewis Carroll didn’t quite write:

The time has come to talk about the Internet of Things

Of BEMS and BACS and web attacks

On automated Buildings

And power from bricks and glass that thinks

And should smart cars have wings?…

To find out more about the study  Smart Evolution 2014: Convergence of Smart Technologies: Towards The Internet of Everything   or to order it , please contact:
Steve Turner Steve.turner@bsria.co.uk
T +44 (0)1344 465610

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