Though it sometimes still feels like the stuff of science fiction, it’s no secret that smart home technology is taking off. A new data-driven report predicts that the market for everything from voice assistants to interactive security systems will cross a significant revenue threshold this year, and also that we’ll be letting a staggering number of smart devices into our homes in the years ahead.
According to a report by research firm Strategy Analytics, the global market for smart home technology is set to reach a projected $103 billion in annual revenue by the end of 2019. A majority of that projected spend (an estimated 54%) will be on smart devices and hardware, but the figure also includes smart home services (think subscriptions) and installation fees. Strategy Analytics further estimates 11% compound annual growth in the smart home market, which means it could reach $157 billion in annual revenue by 2023.
What’s behind that growth? Strategy Analytics states that interactive security devices are a market driver, spearheaded by tech startups like Ring (acquired by Amazon in 2018) alongside more traditional security companies like ADT. However, electrical devices (a category the report doesn’t define clearly, but presumably includes tech like voice and video assistants that can in turn control connected Internet of Things–enabled devices) remain the category volume leader.
Jack Narcotta, senior industry analyst for Strategy Analytics’ smart home strategies group, says these hardware sale increases are “driven by increased awareness of the capabilities and benefits of the solutions.” Furthermore, he notes that prices in the category have declined, making these solutions more accessible to the average consumer.
Subsequently, both the number of IoT–connected homes and the number of gadgets to be found in any given household are set to increase significantly. The report notes that there were already more than 200 million homes worldwide that contain at least one smart device at the end of 2018, and an additional 100 million households are expected to get on board with smart home tech by 2023.
Remarkably, Strategy Analytics expects there will be a total of 6.4 billion smart home devices in use by the end of 2023, making for an astoundingly high average of 21 such connected devices per home. When that comes to pass, designers inevitably will be tasked with finding new and interesting ways to incorporate—and conceal—such gadgets.