A presentation for the IEEE based on a

A presentation for the IEEE based on a report by: Home & Building Automation & Controls Finally ready for the Mass Market? by Wayne Caswell waynecaswell@CAZITech. com © 2006 CAZITech Consulting CONSULTING

Building Systems Sub-industries Lighting Energy Building Mgt FM HVAC Light. Fair Security Access ISC CCTV FMA WEEC NFPA Life Safety Fire Networks ASHRAE AHR Expo COMDEX Wireless IT Telecom Lon. Works Lon. World BACnet EIB http: //www. automatedbuildings. com/news/ mar 03/articles/builconn/bcon. htm NSCA Retail Hospitals Schools Verticals Training Sales Vendors PA Video Audio CONSULTING

Digital Home Applications Lighting Comfort, Convenienc e, Security PC Network Information Internet Access Energy Phone HVAC Audio Irrigation Security Video Entertainment CONSULTING

Solutions Experience Lab l l l l Hotel / Living Room Kitchen Garage / Car Hospital Room Retail Café NW Operations Ctr IPTV, Web. Sphere, RFID, Speech, Embedded, Location Tracking, RSS, Pen-based, Mobile Devices CONSULTING

30 -year Digital Home Technology Timeline Home. PNA founded HPNA 3. 0 CEBus EIA- 600 std HPn. P ENDS Lon. Works EIA- 709 std SCP ENDS HPn. P begun Powerline CEBus ENDS Relative Market Size IEEE 1394 std Wireless Home. RF ENDS VESA HNC formed Phoneline Home. RF 2. 0 DAVIC formed OSGi UWB 802. 11 g 802. 11 WG founded Home. RF WG founded Zigbee DOCSIS 1. 0 Japan’s Home. Bus Home. Plug 1. 0 DOCSIS 2. 0 802. 11 i DOCSIS 2. 0 UPn. P Echelon founded Home. Plug BPL 802. 11 b, 802. 11 a Firewire invented Home. PNA 2. 0 X-10 Z-Wave Home. RF 1. 0 CEBus kicks off Insteon 08 06 04 04 04 02 2000 98 96 96 96 94 92 92 92 1990 88 86 86 86 84 82 1980 78 78 78 76 76 76 74 72 1970 68 Source: Parks Associates’ Research © 2004 Parks Associates 802. 11 e Bluetooth CEBus IS- 60 standard ECHO IV 802. 11 n CONSULTING

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

Mass Market Households vs. High-end New Homes Valued at $500, 000+ are just 0. 065% of the Total Opportunity. 105. 5 M Occupied U. S. Households (2000 Census) 2/3 Owned 1/3 Rental 1. 33 M New Homes Sold in 2003 68 K New Homes sold in 2003 worth >$500 K Total U. S. Housing Market (#M) New Home Construction 2002 New Home Value >$500, 000 Source: U. S. Department of Commerce, National Association of Home Builders CONSULTING

PC, Internet & Home Network Penetration (Millions of U. S. Households) ~76 M Broadband Households (#M) ~71 M ~39 M ~23 M CONSULTING

Structured Wiring (for Satellite TV, Telephone, Ethernet, 1394) Distribution Hub / Panel • Demarcation point for telecommunications and video services. • Often includes Ethernet routers and video amplifiers. • Cost: about ¼ of the entire system Category 5 UTP cables • Cat. 5 unshielded twisted pairs support voice/data transmission up to 100 Mbps. Cat. 5 e supports 1 Gbps Ethernet. • Cost: ~$100 per 1, 000 feet versus $80 for older Cat. 2 cable. RG-6 Coax Cables • Quad-shielded and most effective media for video distribution of hundreds of channels (satellite). • Cost: ~$350 per 1, 000 feet Optical Fiber (optional) • One pair has more capacity than 1, 400 pairs of copper. • Cost: about $150 per foot Wall Outlets • Can accommodate multiple services (data, voice, and video)

Technology Amenities Offered & Installed Source: Parks Associates 2004 Builder Survey © Parks Associates CONSULTING

Entertainment Amenities Offered & Installed Source: Parks Associates 2004 Builder Survey © Parks Associates CONSULTING

Home Builders’ Attitudes about offering NEW Products l They sold $11 Billion in technology products in 2004 (est. $12. 2 B in 2005) They represent a Formidable Channel, but only for NEW homes l 26% have dedicated resource for New Product Development l Source: Parks Associates 2004 Builder Survey © Parks Associates CONSULTING

Households w/ Structured Wiring ~23 M Home Networks So, only about 1/3 can use Ethernet CONSULTING

Home Controls & Automation Market Segmentation Industrial & Commercial AMX Crestron Custom. Lutron Level of Sophistication (installation, support, cost) Installed Builder. Installed HAI Niles Do-it-yourself Appliances Data Entertainment Application Silos Source: CAZITech & Parks Associates Voice X 10 Control & Security CONSULTING

Home Controls & Automation Market Drivers 1. Embedded Processors, Sensors & Actuators 2. Digital Convergence: Media, Devices & Disciplines 3. Standards that Scale & attract Big Players CONSULTING

1. Embedded Processors, Sensors & Actuators l Average Car: 110 embedded processors and capacity of Cray-III supercomputer l A Trillion smart devices by 2010 (interconnected by Standard Protocols) l 4 G Computers: Processor, Network, Power – Berkeley’s Golem Dust (11. 7 mm 3) – Berkeley’s Deputy Dust (6. 6 mm 3) l l Inside the Home: Since you can’t anticipate future wiring, Wireless Mesh to the rescue. Cybernetic Age: embedded Processors, Sensors & Actuators Outside the Home: Always-on Broadband, BIG Broadband CONSULTING

1. Embedded Processors, Sensors & Actuators More Computing Performance at Less Cost (Embedded processors in Everything with a Digital Heartbeat) LINEAR SCALE COST PERFORMANCE TIME CONSULTING

1. Embedded Processors, Sensors & Actuators More Computing Performance at Less Cost (Embedded processors in Everything with a Digital Heartbeat) LOGARITHMIC SCALE COST PERFORMANCE E C AN M OR F CO R PE TIME ST CONSULTING

1. Embedded Processors, Sensors & Actuators Intel processors over Time, showing the effect of Moore's Law Note the Logarithmic Scale Performance (MIPS) Cost ($/MIPS) 100, 000 $1, 000. 00 Pentium 4, 3. 2 GHz 50 M transistors Pentium II, 1 GHz 20 M transistors 8088, 4. 77 MHz 0. 03 M transistors $10. 00 Pentium Pro, 200 MGHz 5. 5 M transistors 100 80286, 12 MHz 0. 1 M transistors $1. 00 10 486 DX 2, 66 MHz 1. 2 M transistors 1 Pentium, 100 MHz 3. 1 M transistors Cost ($ per MIPS) $100. 00 1, 000 $0. 10 32 -bit 386, 20 MHz 0. 2 M transistors $0. 01 Source: Intel 20 08 04 20 20 02 19 99 97 19 19 95 91 19 19 87 84 19 81 0. 1 19 Performance (MIPS) 10, 000 CONSULTING

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

2. Digital Convergence: Media, Devices & Disciplines l DCI Started by IC 2 Institute at U. Texas l Connecting the Greater Waco – Austin –San Antonio Corridor l Extends UTOPIA concept (Utah Telecomm. Open Infrastructure Agency) Digital Convergence Initiative

2. Digital Convergence: In the Home Lighting Home Mgt. Internet Access Energy HVAC Data N/W PC Network CONTROL & AUTOMATIO N Comm. Phone Audio Irrigation Security Video Multimedia CONSULTING

3. Standards that Scale blur Market Segmentation Industrial & Commercial 10/1000 -base-T Home. Plug, UPB Insteon Wi-Fi p- BOM = $14 (2006 MIMO) Zig. Bee Do-it-yourself Z-Wave Mo. CA U ve mo ies ket log Mar no ch own Te d. D an Ethernet w (reliable, scalable, affordable) Custom. Installed Ne IP-based Standards Appliances Source: CAZITech, Parks Associates & IDC Data Entertainment Voice Application Integration w/ Sensors & Actuators Control & Security CONSULTING

3. Standards that Scale attract Big Players l PC: Cisco/Linksys, HP, IBM, Microsoft, Sony l CE: LG, Panasonic, Sanyo, Samsung, Sharp, Sony l Semiconductor: Intel, Motorola, Philips, TI l Appliance: LG, Panasonic, Samsung, Sanyo, Sharp, Whirlpool l Retail: Best. Buy, Circuit City, Comp. USA, Home Depot, Lowe’s, Radio Shack, Sears, Smarthome, Tweeter, Ultimate Electronics, Wal-Mart Finding Nemo, by Disney & Pixar Animation Studios Working together in Trade Associations 1394 Trade Assn (1394 TA. org) Assn. of Home Appliance Mfgrs. (AHAM. org) Continental Automated Buildings Assn. (CABA. org) Consumer Electronics Assn. (CE. org) Digital Living Network Assn. (DLNA. org) Fiber-to-the-Home Council (FTTHcouncil. org) Home. Plug Powerline Alliance (Home. Plug. org) Internet Home Alliance (Internet. Home. Alliance. org) Multimedia over Coax Alliance (Mo. CAlliance. org) Open Service Gateway Alliance (OSGi. org) Universal Plug and Play Forum (UPn. P. org) Wi-Fi Alliance (wi-fi. org) Zig. Bee Alliance (zigbee. org) CONSULTING

3. Standards that Scale attract Big Players

Standards & Technologies that impact Home Control

Powerline Standards for Home Networking & Controls FEATURE X-10 UPB Lon. Works Home. Plug AV Insteon Devices 256 >62 K >32 K >16 M Cost (lamp mod. ) $12 lamp $75 lamp $35 $30 lamp Reliability 1 -way 2 -way Speed 1 -3 sec. 0. 3 sec. Range 150’ 75’ 4, 000’ n*150’ Compatibility de facto Proprietary ANSI/EIA 709 X-10 Function See also: http: //en. wikipedia. org/wiki/Power_line_communication 85 -200 Mbps 0. 04 sec.

Wireless Standards for Home Networking & Controls Tradeoffs l Cost l Battery Life l Compatibility Ease of Setup & Use Reliability Security Range Speed l l l

Wireless Positioning (Relative Measures on Logarithmic Scale) Nomadic 3 G Cellular 2/2. 5 G Cellular 802. 20 802. 16 e 802. 16 a (Wi. MAX) 100 m Vehicular 1, 000 m 10, 000+m Range Stationary 10 m 802. 11 (Wi-Fi) 802. 15. 1 802. 15. 3 (Bluetooth) 802. 15. 4 (Zig. Bee, UWB Lite) Z-Wave 0. 1 Mbps (UWB) 1 Mbps 100+ Mbps Throughput CONSULTING

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

Wireless Standards for Home Networking & Controls AMX Modero Crestron Sony VAIO VGN-U 50 Cor. Access Amigo Niles TS 1 (~$500) Philips Pronto Remote Control S/W for existing

Mesh Networking Source: CONSULTING

Mesh Networking Self Configuring Source: CONSULTING

Mesh Networking Source: CONSULTING

Mesh Networking Self Healing Source: CONSULTING

Network Topologies Zig. Bee & Z-Wave Mesh Star Cluster Tree PAN coordinator End Device CONSULTING

Bridging Clusters >10, 000 Devices (254 * 255 ) 254 Devices PAN coordinator End Device CONSULTING

Wireless Standards for Home Control Applications Zig. Bee FEATURE Z-Wave INSTEON Devices >64 K (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 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’ Compatibility IEEE 802. 15. 4 Proprietary, X-10 Topology Routed Mesh/Star Supervised Peer-to-Peer Mesh Non-supervised CONSULTING

Conclusions The Consumer’s Cultural Lag What we are confronted with Cultural lag Technology Innovation

Conclusions Ready for the Mass Market? We FINALLY have Scalability But TOO Many Standards Need a DOMINANT Player Tough MARKETING Challenges l l l Awareness Branding Partnerships Value Packaging X-10 Active. Home Automation Kit with 5 -in-1 remote, PC interface, and software $49. 95 CONSULTING

Reference Material Automated. Buildings. com (Resource: Building Management Systems) l CABA. org (Continental Automated Buildings Association – Residential & Commercial) l l l CAZITech. com (CAZITech Consulting – Speaker’s home page) Control 4. com (Good online marketing of Zig. Bee solution) Cortexa. Technology. com (Flexible and well-architected solution from local firm) DLNA. org (Digital Living Network Alliance) Home. Toys. com (Resource: Residential Market and Do-it-yourself) Internet. Home. Alliance. com (Collaborative Market Research) Mesa. Home. com (Austin’s oldest Home Systems installer) Parks. Associates. com (Premier Home Systems market researcher) Smart. Home. com (INSTEON developer and online Home Systems retailer) Z-Wave. Alliance. org (Z-Wave information) Zig. Bee. Alliance. org (Zig. Bee information) CONSULTING

Wayne Caswell waynecaswell@cazitech. com 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 Mini. Trends, looking for innovative companies with a promising future and a corporate culture he can support and believe in. © 2006 CAZITech Consulting CONSULTING