Deutsche Telekom first launched its smart home proposition based on the Qivicon platform in 2013. Without insight as to the apps that would drive customer adoption, it sought to give customers maximum choice of smart home devices and to remove barriers to take-up.
Initial adoption was slow. In 2017, Deutsche Telekom integrated its Magenta SmartHome control functionality into Speedport Smart Routers, of which there was an installed base of 170,000. This removed the need for customers to install additional hardware to enable SmartHome. It also offered free device kits as an inducement for customers to sign up to the service. The result was an 80% increase in paying subscribers in one year. Even so, with less than 350,000 subscribers five years after launching, it’s clear that smart homes are not delivering DT a significant boost in the consumer market. By Q3 2018, STL Partners estimated annual revenues from SmartHome reached about €39 million.
The telco continues to evolve its offering with entertainment, asset tracking and smart speaker integration. As the smart home market evolves, DT and other telcos may yet capture opportunities with more targeted products focused on security, entertainment or energy management.
See our in-depth research on smart homes:
- Can telcos create a compelling smart home?
- Consumer Wi-Fi: Faster, smarter and near-impossible to replace