|Today’s smart home applications elicit a similar craze like the stylish motorcycles, cars or smartphones ten years ago|
The development of smart homes is an indispensable trend of the global real estate market and a fertile ground for big tech firms. Most of the leading names in the industry are participating in this field, including Google, Samsung, Microsoft, and Apple, just to name a few, through mergers and acquisitions or the self-development of smart home solutions.
For example, Google acquired Nest Labs (the maker of high-tech thermostats and smoke detectors), Apple introduced the HomeKit smart home application development platform, and Samsung launched its closed smart home system integrated into other products of the company.
Moreover, there are some highly reputable smart home brands worldwide, such as Schneider (France), Honeywell (the US), Legrand (France), Bticino (Italy), and WattStopper (the US). These are the pioneers in the field of smart home development around the world—and many of them have established affiliates in Vietnam.
While commenting on the prospects of smart home development in Vietnam, Lieu Nguyen, president’s liaison to Vietnam for the National Association of Realtors, said that the development trends of real estate projects in the world in general and Vietnam in particular will be largely driven by the application of smart technologies. The world will see the emergence of more and more smart cities, an indispensable element of which is smart homes.
Sharing his opinion, Nguyen Thu Trang, representative of Arkos Smarthome, said that Vietnamese real estate developers are now more proactive in integrating smart home technology into their projects.
Similarly, Mai Trang Thanh, president of Honeywell Indochina, one of the global leading businesses in smart home development, said: “We have received very positive feedbacks from Vietnamese customers about the economic benefits and efficiency that smart home technology and services have been bringing to several projects.”
According to Thanh, Honeywell now owns technologies that are being applied in more than 150 million homes and more than 10 million buildings in the world. The firm is also developing long-term plans for the Vietnamese market, particularly the smart home segment.
Following this trend, in Vietnam, Bkav Corporation is one of the first to launch smart home products. Do Thi Thu Hang, director of Communication at Bkav Corporation, said that Bkav SmartHome has deployed nearly 60 projects in and outside the country. The most recent projects are Ecolife Capitol in Hanoi, Hanoi Landmark 51, and Condotel Royal Park Bac Ninh.
With its tremendous potential, the smart home market is not only a playground for international technology giants and has attracted many Vietnamese enterprises to participate in the field. In addition to Bkav, producers of “made-in-Vietnam” smart home applications also include FPT and Lumi Vietnam Smart House JSC.
Nguyen Duc Tai, CEO of Lumi Vietnam, said that the company has been established for six years, but mainly focused on conducting research on products and potential market over the first three years.
“We have tried to learn from the equipment and solutions of the world’s leading businesses. We then carry out improvements and adjustments in the products to make them better suited for the Vietnamese market. In the past three years, we have focused more on providing solutions and equipment,” Tai said.
He also revealed that 100 per cent of the solutions are self-developed. Up to now, the company still concentrates on big cities like Hanoi and Ho Chi Minh City, which account for 60 per cent of total sales.
Apart from providing smart home solutions for domestic customers, Lumi Vietnam also exports products to foreign countries, such as India, Thailand, Australia, and Brazil. It is expected that in 2018, the company will expand its export markets to other countries like Malaysia or Indonesia.
Tai said that while in 2017, export sales brought in only half of the revenue from the domestic market, the business expects to increase its export market share to be at least as large as its domestic market share in 2018.
Regarding Bkav, after focusing on high-end products, recently, the corporation has started paying more attention to the mid-range segment and export markets.
Hang said: “Right from the beginning, in order to affirm our capabilities as well as to reinforce Vietnam’s technological position, we have been looking to make products of the highest standards by applying state-of-the-art technology. Bkav SmartHome is the latest smart home system in the world. However, to bring this product to more consumers, besides Bkav SmartHome Luxury, we offer the Bkav SmartHome Premium package at a more affordable price for the majority of customers. Bkav SmartHome is becoming popular in Vietnam.”
Hang added that besides product diversification, the corporation is also operating other smart home projects in Europe, Singapore, India, and Myanmar and continues to search for other export markets.
Although the market has witnessed many positive developments, it is not a simple thing to boost the smart home movement in Vietnam. Many smart home solutions have been applied in some real estate projects in Vietnam, but this is only to “pave the way.” It is estimated that it might take about 3-5 years for this innovation to grow stronger.
Tai said that currently, investors also pay more attention to smart homes. They want their products to contain higher added values, thereby offering high-end solutions and equipment, including solutions for smart homes. However, the smart home market in Vietnam remains quite premature.
“According to our survey, only 10-12 per cent of target customers have heard about the concept of smart homes, and over 80 per cent have not shown any particular interest in the idea. Therefore, it should take several years to orientate and raise awareness about smart homes among potential users. It can be said that today’s smart home applications are quite similar to the dream of motorcycles, cars or smartphones of about 10 years ago,” Tai said.
As the market is still in the early stage of paving the way for further development, investors and customers mainly choose basic solutions, such as a management system for air conditioning, lighting, and electricity. Newly designed apartments with open-concept layouts are also becoming more prevalent.
This is the first phase for customers to become familiar with smart home applications. After they have established their needs, more advanced and specialised solutions might be integrated with the existing ones.
According to experts, for the practical deployment of smart home technology, the cost largely depends on the categories and frequency of application. For local businesses, the price of a basic package can hover around VND10-60 million ($440-2630) per building. Meanwhile, to own a smart home with out-of-the-box solutions and equipment, experts estimate that the lowest cost might be $25,000 (about VND600 million).
Despite prices getting lower, customers still have major concerns about the quality of domestic smart home products since most brands have not been tested much. On the other hand, a small obstacle for foreign smart home solutions is that they are not really compatible with the infrastructure and the development of the construction sector in Vietnam.