It’s a New Year, which means it’s time for the annual week of madness in Las Vegas which is the Consumer Electronics Show. For four days, the electronics industry comes together to tell consumers what they ought to be buying, whilst analysts and the media try to predict what will really be the hot product sector for the coming year.
Over the last few years, as PCs, tablets and phones have lost their wow factor, that’s proven to be a little more difficult than it used to be. In 2014, the consensus was that wearables would be the next big thing. They have definitely made strides beyond basic step counting, but are still smouldering rather than setting the world on fire. Instead, the innovation which caught the public imagination at CES in 2014 was the selfie stick.
In 2015, the smart money was on smart homes. But with a few exceptions, consumers felt the smart thing to do with their money was to buy more selfie sticks. This year, the pundits will probably predict that 2016 will be the year of the drone. My guess is that most consumers will still prefer to buy selfie sticks. Unless someone comes up with cheap drones that take selfies*.
Of course, like all good works of fiction, the CES show contains a number of interesting subplots, one of which will be the battle for mesh.
If you’ve invested in any Internet of Things companies or bought a smart thermostat or Apple watch you may live to regret it. Current plans by the people who regulate the radio spectrum – OFCOM in the UK and the FCC in the US have plans in place which may stop most of these devices working. As a result they could cost investors and the industry hundreds of trillions of dollars.
To most people this is a very obscure technical subject, but I’d urge you to read on. The problem is that the debate is being conducted by regulatory specialists, who appear to have little idea of the damage they may be doing. The consequences are not percolating up to CEOs and investors, who should be screaming blue murder. The result of that resounding silence could be that any products that use Wi-Fi, Bluetooth, ZigBee, Thread or any other radio that works at 2.4GHz will degrade or stop working. That includes your home internet, smart watches, fitness trackers, hearing aids, smart meters, health monitors, wireless headsets; in fact most of the products which collectively are beginning the make up the Internet of Things. It will be a self-imposed wound which could put the industry back ten years, allowing China and others to leapfrog to a position of technical leadership.
Today Google and Nest launched the Thread Group – a new wireless network for home automation. It’s not the first and it won’t be the last, but it has some important names behind it. The big two are Google and Nest, not least because Nest’s products may already be using it. But others in the consortium are interesting. ARM is there. Today they power most of our mobile phones, providing the IP behind the processors in billions of chips. But they have a vision of being the microprocessor architecture of choice for the Internet of Things. They processors will be smaller, cheaper and lower powered, but will provide the first opportunity for chip vendors to think about trillions. ARM’s inclusion in the group is an obvious step in their process of acquisition and investment in IoT companies.
Samsung are there (aren’t they always), but so are some very large names in home automation, such as Big Ass Fans and Chubb. And what must be worrying the ZigBee community is that Freescale and Silicon Labs complete the list of founder members.
The important point here is that Thread is not ZigBee. It works in the same spectrum and can use the same chips. It is also a mesh network. But it is not compatible. As the Thread technology backgrounder says, they looked at other radio standards and found them lacking, so they started working on a new wireless mesh protocol. To put it more crudely, it’s Google and Nest saying “ZigBee doesn’t work”.
Having delayed the Fiendishly Complicated United Kingdom Enduring Deployment** of smart meters earlier this year because of technical delays, you might expect that the British Government would have spent some time reviewing the technology they had mandated. If they had done so, it would have become clear that the program was out of control. Under the surface, too many cooks have ratcheted up the technical complexity to the point where it is no longer fit for purpose. However, it appears that no-one wants to point out that the Smart Metering Emperor is stark naked. That’s largely because those overseeing the programme don’t have the depth of technical knowledge to understand the implications of what is going on.
As always with big Government driven IT programs, whilst there’s money to be made by the metering industry and consultants, momentum rules. It seems perfectly justifiable to carry on and saddle consumers with a £12 billion white elephant which will further inflate domestic energy bills. As a result of this lack of due diligence, smart metering is firmly on course to be the next big UK Government IT disaster.
It’s not that there’s a fundamental problem with smart metering, but there are massive mistakes in the way that the UK has decided to do it. When the programme started, it was seen as world-leading. It should have set a global standard for smart metering, giving UK plc a commanding lead in exporting expertise to the rest of the world and creating long term employment opportunities. Instead it has resulted in an out-dated, over-complicated system which will be incompatible with any other solution in the world, cost more than any other, fail to deliver the promised customer benefits, add risk to our energy security, threaten jobs, further alienate customers and make the UK energy industry a laughing stock.
If we look at the issues, the GB smart metering program appears to have a unique capacity not just to duplicate major errors from previous Government disasters, but to combine many of them into one overarching Government- destroying fiasco.
Back in 2010, Mark Thomas, the head of PA Consulting’s Strategy and Market practice published a book called The Zombie Economy. In it he defined a Zombie company as one which is generating just about enough cash to service its debt, so the bank is not obliged to pull the plug on the loan. The issue with such companies is that they can limp along, and just about survive, but as they don’t have enough money to invest, they fall over once the economy picks up, as they become uncompetitive. The problem they pose is that by continuing to exist in this Zombie state they threaten the development of other companies, acting as a damper to more sustainable businesses.
It struck me that there’s a close analogy in the area of wireless standards where we have what are effectively Zombie wireless standards. There’s not necessarily anything fundamentally wrong with these individual standards, other than that they have failed to get traction and so limp along. Here, the problem is that they tend to jealously claim a particular application sector or market segment, blocking other more successful standards from entering. That has a damping effect on product development, creating silos which keep putting off innovation in the hope that one day the standard will gain traction, constantly delaying growth and interoperability. Because they’re not being incorporated into enough products, they have effectively lost their ability to function and have become half-dead, half-alive ‘Zombies’.
I think it’s time to recognise the damage that this is doing. Rather than pursuing multiple parallel paths, the industry needs to concentrate on a far smaller number of short range wireless standards. They in turn need to embrace the requirements of a wider range of sectors.
Today in Parliament, the UK Secretary for State for Energy and Climate Change – Ed Davey, announced that there would be a one year delay in the GB deployment of smart meters. That’s not a great surprise to anyone. Rather than copy what has been deployed in other countries, the UK industry has been developing specifications to make our smart metering system the most complex (and expensive) of any deployment anywhere in the world, and complexity takes time.
However, the timing is not great. Anyone following smart meter deployment will have noticed a distinct slowdown over the past few years. Some of the larger US utilities have already rolled out smart meters, helped by $83 billion of stimulus funding. A significant chunk of Australia has them as well. But as stimulus funds have dried up, so have the bulk of smart meter deployments.
The one remaining gung-ho project was the UK one, where previous ministers had been keen to pull it forward. A lot of the rest of the world, particularly other countries within Europe, who are working out how to address the EC directive on smart metering, have been waiting and watching to see how we’re doing. On the surface it’s looked good. Underneath there are conflicting interests which have been building up delays. Unfortunately the timing of today’s announcement plays to quite a lot of those underlying politics, which could further derail the future of the program.