Germany Will Have More than 5 million Smart Homes by 2020

  • Posted on: 20 May 2015
  • By: Tillmann Braun

According to a recent survey, approximately 5 million households in Germany will be equipped with a smart home system by 2020. That means that the number of connected homes will increase by almost 900 per cent within a few years. One of the main reasons for the predicted surge is that the current solutions are often still quite expensive and don’t offer the security end users are looking for. However, now that more and more companies have started to develop new systems that aim to match the user’s needs, the demand for smart home systems is growing rapidly.

The survey conducted by MS&C, reveals that 21 per cent of users in Germany have safety concerns when it comes to current smart home technologies. The expensive price-tag of the products is an even bigger factor.  More than 50 per cent are put-off by the costs of smart home systems. The good news is: MS&C expects that the prices will fall by approximately 50 per cent over the next seven years. The price drop, which is already taking place, is one of the reasons why the number of smart homes in Germany will be two times higher in 2016 than it was in 2014.

Thanks to up-to-date smart home systems, insurance companies are expected to save up to 340 million euros over the next 5 years. For the end user, this means that he and his house will be much better protected - and that he will be able to save a lot of money in insurance premiums. A possible model for the insurance companies, for example, is to offer consumers special insurance packages for the holiday season when certain smart home devices are in place.

According to the survey, the main driver for the market surge is the new focus on the needs and expectations of the customer as well as on useful applications and software optimisation. The days of a more technical approach to the smart home seem to be numbered.

Germany’s market leader for home networking devices, AVM, has already added smart home features and functions to its FRITZ! products, using the secure and eco-friendly ULE standard (Ultra Low Energy). Once the latest firmware, called FRITZ!OS, has been installed on one of the company’s FRITZ!Box routers, users can control their entire home network via their router - or other connected devices such as a smartphone.  As many consumers in Germany have a FRITZ!Box at home, millions of homes could be converted to a smart home by the click of a button.

Another German company that uses the ULE standard for networking devices is Gigaset. Gigaset Elements is a sensor- and cloud-based solution for the networked home. The starter kit consists of a door sensor and a motion sensor as well as a base station and an app for smartphones. The system can be expanded by additional modules.

Potentially, all ULE-based products from different manufacturers can be combine within one network. To ensure compatibility, the not-for-profit organisation ULE Alliance launched a certification program for ULE-products earlier this year. The organisation expects that a wide range of companies will get their products certified within the next months – not only in Germany, but globally. The predicted smart home boom in Germany might therefore soon kick-off in other countries too.

braunTillmann Braun is a freelance journalists and consultant from Stuttgart, Germany. He covers all kind of IT topics such as IT solutions for businesses and end users, M2M communication, home networks, consumer electronics and building automation.