Tuesday, 23 December 2014

Merry Digital Christmas! A review of the year in the smartlock/digital keys space, and AT&T's Digital Life smartlock present for you

Merry Christmas and Happy New Year! And what a year it has been in the smartlock/digital keys space.

This year we've seen many ups and downs for smartlock companies - for example Goji, Lockitron and August all had delays to their promised delivery dates. Kwikset's Kevo, also behind in their promised delivery date, finally released their smartlock at the start of this year, and since then they've been moving amazing volumes - 30,000 a month.

And we had Assa Abloy install 30,000 smartlocks into Starwood Hotels later in the year, with even Steve Wozniak getting excited by the technology (see video here). Hilton Hotels and Accor Hotels also announced plans to begin rolling out smartlocks/digital keys into all 650,000 of their hotel rooms over the next few years.

When August and Kevo finally started shipping they got alot of mixed reviews in newspapers and journals (see some examples here and here).

This year we've also seen loads of partnerships, collaborations, mergers and acquisitions in the smarthome space. But the smartlock as part of the smarthome so far has essentially been locked out of all that action (pardon the pun!).

We had the big smart-thermostat acquisition of Nest by Google for $3.2 billion. Then the big acquisition of the smart camera of Dropcam by Google for $555 million. And smart lights companies, and smart security systems, and smart hubs have all seen plenty of action too (e.g see here).

But so far we haven't seen any real action yet with smartlocks in the smarthome. By real action we mean, there has been no smartlock acquisitions yet, and there has not been any smartlock start-ups aligning with big IoT players, other than Apple with August, and Yale with AT&T.

So its shaping up to be a massive 2015 then for smartlock/digital keys companies. We're just going to have a quick look at why perhaps we haven't seen much action yet in smartlocks/digital keys by looking at the AT&T Digital Life Yale smartlock offering as an example.

Firstly these are your choices for smartlocks if you sign up with AT&T's Digital Life - you have 2 choices - a Yale Deadbolt with keypad, or a Yale Deadbolt with touchscreen. And that is it. See them below.


The Yale touchscreen deadbolt works with Z-Wave so that you can control it with your smartphone. But the Pushbutton deadbolt isn't really a smartlock at all. You can't control access to it remotely with your smartphone, and you can't open it with your smartphone. So really you have one choice if you want a smartlock as part of your smarthome package with AT&T - a Yale touchscreen deadbolt which retails for around $400 - see here.

Recently we published a post on our blog here about the massive range of metal key locks available in hardware stores. The biggest hardware store chain in Australia for example was found to have stocked over 2000 different types of metal key locks. 

So if there are over 2000 different type of metal locks in your average hardware store, what does this tell you about consumers 'wants' when it comes to locks? They want to choose from a range of lock hardware right? If they didn't want a big choice, then there would only be two metal key locks in the hardware store right? That's if we assume the old economic theory of supply and demand.

So if the consumer wants a range in lock hardware, then why do they essentially get no choice about the smartlock range they must take with the AT&T package? Is it because there is nothing else out there? If not why not? Are smartlocks that hard to make?

Now we have no idea how many Digital Life packages with the Yale Deadbolt have been purchased from AT&T since its been on the market. Maybe its selling really well. Maybe people love it - who knows.

We also posted earlier this year the alarming statistic that keyless locks are now in 80% of 1.5 billion cars on the planet, but keyless locks are only in .1% of 1.5 billion houses on the planet.

So if you put all the facts here together from 2015 this is what you come out with; there has not been any smartlock acquisitions yet; there has only been a couple of smartlock partnerships (where-as there has been hundreds of partnerships for other smarthome products); there are only a couple of smartlocks currently available in the marketplace; even the ones that are available have had serious issues. The IoT companies want to sell smartlocks; customers want a range of smartlock options. 

So the final point to make then is that the smartlock/digital keys market is ripe for the picking right now. Will one company emerge next year in 2015 with dozens of smartlock products, and dozens of partnerships or sell for $500 million to $3 billion? We're excited about finding this out!

Happy Holidays and New Year and thanks for reading - see you again in 2015!


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