Despite growing momentum for smart home products new research from tech analyst firm Telsyte revealed key hurdles remain for the industry with growth and longevity hinging on standards.

While some commoditisation is occurring such as in smart lightbulbs and price declines for high-end appliances like smart fridges, the overall the cost of smart home products and services could rise along with growing inflation, prolonged chip shortages and demand outstripping supply in some tech categories.

The Telsyte Australian IoT@Home Market Study 2021 found the shift from freestanding homes into smaller apartment style living could mitigate the uptake of some products, such as smart gardening and smart doorbells.

Cybersecurity and privacy concerns have fallen too, from the number one barrier to third among potential adopters.

Telsyte managing director, Foad Fadaghi said smart home privacy concerns are decreasing but concerns remain. “Around 30% of people reject any notion of the smart home and are worried about privacy and surveillance,” he said.

Among those yet to be interested in a smarter home, concerns of complicated installations have increased from 12 months ago, highlighting a lack of standard which have plagued the industry until now.

Getting smart devices to work together requires standards-based protocols. The arrival of the new industry standard, “Matter”, aims to unify industry approaches and allow devices across multiple platforms to communicate with each other. According to Telsyte simplified process and compatibility issues are critical to improving consumer sentiment around IoT@Home devices, especially among those yet to be fully invested.

Matter has more than 120 companies in the alliance, including Amazon, Apple, Arlo, Google, Oppo, Samsung and Schneider Electric. The final specification is expected to be released around mid-2022 for popular IoT@Home devices such as lightbulbs, power plugs, door locks, security sensors, bridges/hubs, smart TVs and set-top-boxes.

If there are no supply shortages, Telsyte anticipates at least 30% to 40% of IoT@Home devices sold could be Matter compatible by the end of 2023.