Following Total Telecom Congress event in London last month, Total Telecom met up with devolo AG’s Director for Product Creation, Sebastian Richter, to discuss developments in the home networking market
What trends are you noticing developing in the market at the moment?
A couple of weeks ago, one of the biggest discounters offered the latest version of its food processor. The special thing about it: For the first time, it had an integrated WiFi function. This example shows, it becomes totally normal that kitchen appliances in the mass market, not only the premium products, also have WiFi – it becomes normal that all possible devices at home are wirelessly connected to the Internet, not just those in your living room or your study.
Therefore, the need for seamless coverage across the entire home is growing rapidly. And we haven’t even talked about the need for high bandwidths that data-hungry services such as online gaming or streaming in high resolution entail. So, the trend is clearly towards higher bandwidths, available in every corner of the home.
Why is home networking becoming an increasingly important topic for operators?
Because the development I just outlined, directly impacts the solution, they provide to their customers. For years, many operators focused on providing broadband access, the faster the better. Meanwhile they realised, this is not sufficient if they want to keep their customers satisfied. They have to think of an end-to-end solution, because the customer is no longer happy with strong Internet access in some area in his house, he wants to use the device and the service he wants wherever he wants.
If the coverage, the provider’s solution offers, isn’t sufficient, clients might try to help themselves by buying some devices to repeat the signal, which still won’t do the job. And in the end, they blame their provider for weak reception – which leads to a higher churn rate and a decreasing net promoter score. Therefore, more and more operators think beyond providing access.
What are the keys to a high-performance home network?
There are three keys: availability, performance and convenience. Availability means to secure connections everywhere, which can be a challenge especially in houses with different floors. Customers therefore need a distributed solution with several well-placed access points. Then you have to make sure, this distributed network provides high performance. To do this, you combine WiFi and powerline communications: Using the powerline as backbone, you make sure the WiFi signal is not blocked by thick walls or ceilings. Besides, you save WiFi spectrum you’d otherwise need if you use WiFi as backbone.
Finally, you must avoid a distributed network becoming complex, as no one wants to bother with settings or maintenance. WiFi mesh features, Multi Access Points and intelligent comfort feature management, e.g. by devolo’s Config Sync, ease the set-up of a home network and ensure, customers experience the best performance.
How do operators benefit, if they put a stronger focus on home networking solutions?
They enter, what was formerly a black box for them – their customer’s home. We see more and more ISPs gathering information about the use of their devices and designing home networking solutions additional to the gateway. Thus, they are able to provide better services or even sell additional ones. But most important, they actively increase the customer retention, lower their service call rate and positively influence their net promoter score.
How will home networking solutions evolve over the next couple of years?
We will see the spread of new standards, take Easy Mesh for example – this is a very important step for operators, because they can combine different devices from different vendors within the home network with their gateway and make all of them trackable. This is an important step for them.
Moreover, the networks will become more intelligent as they will be able to configure, manage, repair and even defend themselves. The home network will then also become an essential part of a truly smart home, e.g. the user could just tell the voice system to switch on the guest WiFi and provide a guest with the login details – this intelligently links two previously separate systems.
We also see that coverage will become more important than pure speed. With more and more devices wanting to go online, the network needs to be capable to deal with 30 to 50 WiFi clients, while today it only needs to handle some 10 or 20.
What new markets are particularly interesting to devolo at the moment?
Additional to the market for home networking solutions we focus on smart home and smart grid. The smart home market is growing steadily, more and more people benefit from modular solutions like devolo Home Control to reduce energy costs and to increase comfort and security. This market is also driven by the spread of voice systems like amazon Alexa. Besides, we give the market additional impetus through new partnerships, e.g. with insurance companies. The combination of technology, special tariffs and exclusive services creates new business models that open up new sales opportunities.
Moreover, a smart networked home will become part of the new energy world, which is currently emerging, since the energy infrastructure is evolving into a smart grid. Therefore, devolo offers a new range of products and solutions e.g. comprising smart meters or a smart meter gateway to secure its position as technology leader in this area as well.