Smart homes and the Internet of Things present a huge potential to bring efficiencies, increase service quality and improve the standard of living for millions of people. Social landlords and their tenants need these benefits in their properties; the problem is there exist several barriers to achieving this goal. Whilst the generic barriers to wider IoT adoption receive much coverage in the media (such as this excellent Wall Street Daily article), there has been little coverage of the barriers specific to the professional letting sector.
This article will address those barriers and provide some insight into a possible solution which will allow the professional letting industry to catch-up with the much more developed consumer smart home market.
1. Devices aren’t tailored to landlords
It’s hard to adopt a new technology, especially when the market is not tailored to the sector in question. The smart building market is an example that caters very well to the opposing ends of a scale. On one side are the well-known consumer focused devices offering smart thermostat services for example. These devices are specifically targeted at consumers with one property and who stand to receive a direct benefit from the services the device offer.
To illustrate this point, what reason does a landlord have to install a smart thermostat in their property, if only to improve the living conditions of their tenant? Even in cases where the landlord is the utility bill payer, a return on investment could take years or not occur at all, especially with the more premium services.
At the other end of the scale are the complex building management systems targeted at facilities management organisations. These are usually highly bespoke and deployed in large office buildings, hospitals and hotels. They are designed to facilitate the smooth running of the building as whole; treating floors and rooms as separate smaller buildings. These systems don’t make sense when there are multiple buildings (as with homes) with only a small number of rooms; hence why these systems are not deployed in domestic properties.
What is missing lies somewhere between on the scale. Social landlords are facing ever-increasing regulatory pressure, margins are getting tighter and there is strong competitive desire to innovate. Landlords urgently need the benefits of smart home technology, but without the costly and time-consuming process of deploying large building facilities management systems; or the headache of developing their own custom integrations with multiple consumer-focused systems.
What is needed is a smart home ecosystem that is specifically tailored to social landlords, that understands the unique operational and infrastructure requirements of the professional letting sector.
2. The age of the verticals
In recent years there has been an increase in the number of products and services offering ‘vertically integrated’ smart home solutions. This is where a vendor provides a comprehensive service which includes everything from hardware and connectivity to cloud services and analytics. A hallmark of vertically integrated systems is a strong product family ecosystem, with few third-party integrations. There are plenty of well-known vertically integrated smart home products covering areas such as heating, home security, lighting and entertainment. Whilst verticals present an opportunity to focus on a particular aspect of the smart home, when a social landlord eventually (and inevitably) wants to integrate additional services alongside their chosen platform, they will come up against the first barrier created by vertical systems – vendor lock-in.
In an age of continuous innovation and technological advancement, vendor lock-in is something to be avoided at all costs. Writing in a Fast Company article on the dangers of vendor lock-in, Jared Newman argues that smart home devices should be inter-operable and that the tech giants should commit to pushing standards forward. “Doing so will go against years of tradition, but in the long run, it’ll be worth it for everyone.” By owning each stage of the value chain, well-known verticals dominating the consumer market can avoid having to pay other vendors for their components of the solution. Furthermore, by controlling the entire ecosystem, the vendor effectively forces the customer to buy any subsequent products from them, in order to prevent the customer from having to rip up an entire system and replace everything anew.
Some vendors have responded by providing open APIs but this has been met with criticism in an internet age of information sharing and interoperability. Speaking of interoperability, Tobin Richardson, CEO of the ZigBee Alliance says, “having an open API just means ‘I’ll let you write to my system. That’s not really an open ecosystem. That’s just saying you can talk to me.” This is a far cry from the unfettered openness of the internet and is in stark contrast to the principles upon which the web as we know it today was created.
What all this means for customers is a very difficult choice indeed. Not only are they required to evaluate the vendor’s technology objectively, but they must also contrast this with their own strategic technological vision. Partnering with a vertical can bring powerful benefits in the short-term, but leaves social landlords with significant gaps in their technological future, forcing them to revisit costly procurement processes.
Social landlords are swamped with dashboard and management platforms for their various services. They need a unified smart home service with a single dashboard, single account with all their data in one place. What they need is a horizontally integrated service.
3. Consumer systems don’t scale well
Social landlords and property maintenance managers face a dilemma when it comes to procuring smart home solutions. Take a typical social landlord with 10,000+ properties who wants to leverage the benefits of connected homes in order to negotiate a better energy deal for example. There are plenty of consumer smart home solutions out there but if the landlord doesn’t want to develop a custom integration, they will need to use the vendor’s API (application programming interface). Added to this is the nature of consumer-focused devices, namely that they are built from the ground up to be used by a single account holder and at one property. The alternatives are the expensive bespoke building management systems mentioned previously, or a completely in-house solution. Even with these professional systems, there are few that operate across multiple properties in a portfolio and each have their own local dashboards, offering little strategic oversight.
Once the landlord has chosen a number of device vendors, they must now assemble an operations team with which to manage the thousands of individual user accounts that each smart device is linked to. Another team will be required to collate the data and produce reports, a step that could indeed be automated but at greater integration and development cost.
This begs the question – once a landlord has built up their crack team (software engineers, UX designers, web developers, hardware engineers, database engineers, data scientists and A.I. engineers), what are they to do with them once the system is built? Of course they will be needed from time to time to maintain the system and perform upgrades; but the vast majority of the development team will no longer be needed, forcing the landlord to shrink the team.
This presents its own problem. What does the landlord do if something goes wrong? The expertise which developed the system has left and hiring in consultants to fix the problem is a costly solution; with no guarantee that the problem indeed can be fixed.
Social landlords need systems that are modular, expandable and flexible enough to accommodate changing requirements and that can evolve along with the needs of society, the landlord and the tenant.
4. WiFi is unreliable
The widespread adoption of home broadband Wifi was supposed to usher in a new era of ubiquitous internet connectivity. Instead, it has created a veritable security nightmare; with huge differences in standards of security hygiene from one property to the next. One of the most important lessons I learnt when designing secure military IP networks in the defence sector, was the importance of being able to trust your data transport infrastructure. In most smart home setups, it is more convenient (and cheaper) to design a product that uses the existing Wifi. This cost-saving measure actually does more harm than good to the smart home industry as whole.
The assumption that an existing Wifi connection is secure is a dangerous one. According to a survey carried out by Broadband Genie, 82% of UK households do not modify the default admin passwords of their Wi-Fi routers. As if that was not bad enough, 82% did not change the default network name, 86% never updated the router’s firmware, 70% had never checked for unknown devices on the network and 69% had never changed the Wi-Fi access password. Perhaps the most worrying thing is that more than half of the people asked – 51% – claimed to have never taken any of the steps mentioned above to secure their network; and alarmingly, 48% didn’t understand the reason why they even needed to.
This is made all the more alarming by the fact that whoever operates the WiFi connection (usually the tenant), takes on the role of IT and information security administrator at the device end of the vendor’s smart home ecosystem. How many technology companies would be happy allowing their customers to set their security policies within the organisation?
Landlords need dedicated, independent and secure communications infrastructure that doesn’t rely upon the tenant’s WiFi. They need to be able to trust that the system they are using is secure and will not cause them embarrassment or lead to financial loss.
5. Consumer devices lack enterprise-grade security
Consumer smart home devices have evolved in an internet age that was built around computer terminals with keyboards and monitors. Most internet security mechanisms rely on the concept of a user of some device (usually a PC or smart phone) being a human, with an ability to follow security protocols. In the world of the IoT, devices do not have users or even keyboards and instead rely on other means of securely identifying themselves to a vendor’s cloud services. The problem arises when an IoT device becomes compromised. This can happen via any number of ways; either through deliberate internal abuses or by a newly discovered flaw in the security of the system. When this happens, the device itself may not be aware that it has become compromised. Without a sophisticated means of analysing internet traffic going to and from a device, compromised devices may go undetected for months or even years. This is made particularly difficult to detect by the fact that a compromised device may not exhibit any symptoms whatsoever.
Landlords wishing to deploy smart home systems must first overcome this barrier. The problem is similar to how large organisations source their IT systems. At no point would a large organisation build up their IT systems by purchasing multiple consumer devices and then proceed to knit them together without some sort of ordered and systematic approach (not to mention with a large IT department on hand to facilitate this).
This is further complicated by a lack of clearly defined areas of responsibility. In the consumer smart home market, responsibility is largely a black and white issue, with clearly defined lines between what is the vendor’s responsibility and what is the customer’s. In a large social housing smart home deployment however, who is responsible for cyber security? Take WiFi for example, where if the tenant owns and operates the WiFi connection, then they alone are responsible for everything that is done over that connection. Similarly if a landlord provides a WiFI service, they too are responsible, albeit sometimes through a lengthy terms and conditions agreement with the tenant. Most landlords are not in a position to provide the necessary security guidance and oversight, often leaving it the vendor to sort out.
All this coupled with the typically poor standards of WiFi security hygiene found in more than two-thirds of properties, presents enough of a headache to dissuade landlords from deploying smart home systems that aren’t specifically tailored to these unique challenges.
What is needed is a new approach to IoT security, where security is an integral part of the ecosystem, with state of the art A.I. and networking tools used to monitor traffic and the status of each device.