The smart home industry, or connected homes, has experienced explosive growth in recent years, as advances in technology have made it much more intuitive and easier to use. According to Zion Market Research, the global smart home market exceeded $ 24 billion in 2016 and is projected to increase to $ 53 billion by 2022.
An opportunity of such magnitude has attracted the attention of Wall Street and some of the best and brightest technology companies. Companies with smart housing offers can be divided into three broad categories: do-it-yourself (DIY), managed services such as home security and professional installation.
Let's take a look at some of the companies involved.
Amazon.com (NASDAQ: AMZN)
Alexa Devices, Security Cameras
Alphabet (NASDAQ : GOOGL) (NASDAQ: GOOG)
Nest thermostats, cameras, smoke detectors, Home
Apple  (NASDAQ: AAPL)
Speakers, cubes, sensors, plugs
AT & T
Managed content  Domestic security
Apollo Global Management
ADT home security
Control4 [1 9659039] (NASDAQ: CTRL)
Professional installation n
Custom design and configuration
With all those companies to choose from, which offer investors the greatest opportunity? I have four favorites, three in the DIY category that offer devices and software and one in the professional installation category. But first, some background.
What is an "intelligent home"?
In very general terms, a smart home incorporates any number of products connected to the Internet to automate, control or control the systems of the home. The devices can be managed on a local system, or remotely via a smartphone, tablet or computer, and can include lighting, security, climate control, appliances and entertainment. People can use the devices to perform a variety of functions, such as remotely viewing transmissions in real time from a security camera, turning appliances on or off, or adjusting a thermostat.
There was a time when these domotic systems required professional installation and were found only in high-end homes, but recent technological advances have resulted in options for all price ranges.
The emergence of the digital assistant in smartphones was the first step in the changing landscape. The advent of voice-activated loudspeakers based on artificial intelligence (AI) was the catalyst that made smart home products available to any consumer with broadband and a Wi-Fi network. Smartphones and smart speakers can be used as a control center for a smart home with a finger or a voice command, driving consumer adoption faster and faster.
Built on a strong AI base
Alphabet may be known for its Google search engine, but the company has been a pioneer in AI research, the technology that makes smart speakers possible. The company responded to Echo's challenge with the Google Home speaker who acts as its smart home hub, and recently launched several new additions to the line.
Data derived from the company's mass search engine provide the knowledge base for their devices. Instead of working through syntax-based commands such as Alexa, Google Home has a more developed understanding of natural language, which increases its ability to understand and respond to a user's request.
Google supports more than 1,000 third-party devices that work with your smart speaker. The company also supports the help center by chat or by phone for customers who configure their smart products using Google Home.
Instead of working only with smart home products from other companies, Google has its own brand, Nest, which offers smart thermostats, smoke and carbon dioxide detectors and security cameras that integrate seamlessly with the device.
CIRP analysis showed that Google Home controlled the rest of the smart speaker market, with an estimated 7 million devices and a 27% share market, which is impressive considering Amazon's two-year start .
The Google search engine and ads will continue to be Alphabet's main revenue driver. In its recently completed third quarter, sales grew to $ 27.7 billion, an increase of 24% year-over-year, while diluted earnings per share rose 32% even more impressive, to $ 9.57.
If you're worried about security …
Apple's flagship iPhone has a built-in application called Home that manages a HomeKit ecosystem of connected devices for the home.
What separates Apple from the competition is its penchant for privacy. Any product that works with HomeKit has been examined by Apple to ensure end-to-end encryption, protected wireless chips and various other measures designed to withstand most hackers. The result is the safest smart home system available today. Apple lists dozens of devices compatible with HomeKit on its website, each meeting its rigorous privacy and security standards.
Apple also uses a process called "differential privacy," which aggregates any information it collects and injects digital noise into data to keep individual information private.
Apple plans to launch its HomePod smart speaker in early 2018, and if the past is an indicator, it will be the next "must have" device among Apple's loyal fans. With each new product category, Apple soon becomes the leader of the segment, as evidenced by the launch of the iPad and the Apple Watch.
Apple's HomeKit is inextricably linked to the iPhone, which produces the bulk of the company's revenue. In its fourth fiscal quarter, the company reported revenues of $ 52.6 billion, an increase of 12% year-over-year, and earnings per share of $ 2.07, an increase of 24% over the prior-year quarter. Apple's service revenue grew 34% year-over-year to a record high.
If you are not interested in DIY
Control4 is the only pure game on this list. The company eliminates the conjectures and possible errors in the configuration of a smart home by designing and installing a system based on individual needs. Consumers can not only choose the devices and functions they want, but can also customize the interfaces used to control them, from touch screens to touch screens and voice control.
The company has a network of highly trained distributors who work with The owners realize their individual visions of a smart home system.
Control4 realized that the network was the backbone of the smart home, so in 2016 it acquired Pakedge Device & Software for its integrated wired and wireless networks, allowing it to control that variable in the equation.
Control4 has experienced explosive growth, and stock has more than tripled so far this year. In its fiscal third quarter, revenues reached a record $ 65 million, an increase of 17% year-on-year, and net revenues of $ 5.2 million almost tripled from the prior year quarter. A recent release of new audio products resulted in several analyst updates, and should contribute to future growth.
The fine print
It is important to bear in mind that with one exception, each of the aforementioned companies produces the majority of their income from a previously existing and somewhat massive central business. Control4 is the outlier and the only pure game on the list.
While the smart home businesses of others could achieve considerable growth, they will continue to be eclipsed by the main revenue driver of each company. These technological monsters are competing for control of the consumers' device ecosystem, with the smart home providing the open door.
Now that you've seen my selections for the best smart house actions, it's time to take out your smartphone, turn on the lights, and deepen your own investigation.