The cost would be dramatically different. I’m not sure what exactly our hosting costs are currently, but it is definitely less than $2/month/user.
Thank you for the insight. However, I do believe that the cost is not the major obstacle here. Many ST users said that they’d gladly pay a reasonable monthly fee if the service were reliable. Considering that an average user has 12 devices, as we now know, it wouldn’t be unreasonable to offer a free service for up to 10 devices (to get you started) and charge $5 per month for every 100 devices after that. Just an idea.
Perhaps engineering and/or operations might support that idea; but now go and try to convince the marketing and product management departments. Though even convincing the former to give up on the notion of minimizing the cost of scalability (i.e., by sharing resources as much as possible but not beyond the breaking point…) would be a challenge. This is not something that can come from the bottom up.
TL;DR: – A platform build using a dedicated cloud VM per Hub would cost much more than even a hypothetically optimal scaled shared architecture. SmartThings is opposed to such a significant difference in hosting costs, since even minimal ongoing revenue streams have yet to materialize (especially if there are influential architects that don’t believe that such expensive hosting options are “necessary”).
I would say that this type of subscription based service for standard features (i.e. just using your devices normally) is a HUGE turn-off to a lot of general consumers when you have other options on the market without that barrier to entry. It would push the hub into a separate tier of HA solutions which don’t nearly have the popularity of the one-time-cost hubs and don’t have the reliability or power of the professional hubs.
Obviously, everyone has different needs and requirements. I don’t like to pay monthly fees any more as the next guy, but I have no problem paying $8 for Netflix because it has value to me and is reasonably priced. And apparently so do over 40 million of Netflix subscribers in US alone.
Speaking only for myself, I would be open to a subscription fee for a personal cloud service if it were 1) 99.9% reliable and 2) ensure privacy and security of my data. I wouldn’t pay $40 that Xfinity is asking because it exceeds perceived value of the service to me. But paying something like $5 a month for a 100 devices per month sounds perfectly reasonable to me.
Based on my estimate, this fee would be more than sufficient to cover SmartThings operating expenses. Iris uses similar tiered pricing which seems to work for them, but the problem with Iris is that just like SmartThings, it’s a “shared cloud” and therefore suffers from the same scalability and reliability issues.
There is still a large group of consumers who see a subscription service as a non-starter. Iris also seemingly isn’t doing nearly as well as SmartThings even though they have entire sections of physical stores devoted to them all over the US. The only online community I found in a quick search hasn’t had a new post in it for over 3 weeks…
That’s why it’s essential to offer a free entry-level service. Not feature-limited, like Iris does, but rather restricted by the number of devices.
The only online community I found in a quick search hasn’t had a new post in it for over 3 weeks…
Iris (along with Wink and Staples) does not need Community for two reasons:
- It’s not a development platform.
- It has a full-scale live telephone customer support: 1-855-469-IRIS (4747)
From the consumer (as opposed to developer) point of view, it’s a better proposition than seeking advise from a community.
I can understand shying away from a core-feature-limited subscription, but in this case wouldn’t using your devices be a core feature? I would put things like Video Cloud storage, monitoring services, etc as being non-core subscriptions which ST is already implementing.
No, I don’t think so. An average SmartThings customer has only 12 devices, meaning that most people just buy a starer kit and maybe add just a few more devices. For these folks the service would essentially remain free and unrestricted in any way (unless they opt for video streaming). The rest of us, who have a lot of devices and would require more than a basic single core VM to run them, would have to pay a monthly fee for a “premium” VM.
If they started the company with that methodology I could see it working but at this point they have both explicitly stated that they wouldn’t charge for previously released feature on top of the fact that there would likely be a large scale revolt. I really don’t think SmartThings or Samsung want that type of exposure.
Personally, I hope ST build something similar to Rule Machine or maybe if it comes back allow offline mode, not even sure if thats possible.
Feels like Cloud should be something optional or least work without it fully, so local processing should come first. I think current ST apps already work offline? Not sure current hardware could allow vast amounts of offline apps etc but maybe a later version can.
I think SmartThings could serve as a simple proxy for anyone wanting online access, they can still log events/collect stats e.g average device ownership, which devices/apps are popular, data mining etc.
Right now not sure I’d be willing to pay a monthly fee but if everything could work offline first sure I’d consider a small fee (probably based on device count) so I could communicate over the internet, just don’t like the idea of rules/functionality breaking because either ST has gone down or you no longer have internet access for some reason.
What you also have consider is every powered device adds to the electricity cost. Right now for me it only adds £1 per month having all the bulbs/devices on standby, this might improve in future devices with lower standby costs hopefully! I could easily see that increasing to £5 month or even more for some users.
This is exactly what I’m talking about. None of these “band-aids” would be necessary should the cloud portion of SmartThing ran on a personal VM rather than shared cloud.
Except the market says otherwise.
There are over two million accounts on iControl services who pay upwards of $30/month. (ADT Pulse, xfinity home, time warner Intellihome, Rogers in Canada, and a few more)
And of course Lowe’s Iris is $10/month if you want their premium service.
You add those together and it’s way more people than SmartThings plus Wink plus Vera.
They are paying for convenience and reliability. They’re giving up flexibility and versatility and quite a few features.
There’s still room in the market for both business models. (Icontrol bought piper just so they would have something to offer without a subscription.)
But as of now there are more people willing to pay a subscription, not less. But they may be two completely separate groups, it’s hard to tell how much overlap there is.
I suppose I didn’t really lump those under “Home Automation” because they’re more add-on services for either Cable/Internet or Conventional Home Security. But you are correct, that business model is becoming very popular and is probably how most people are exposed to “Home Automation”.
I am not inclined towards product as a service models.
Further, given the track record here - if there is going to be a re-architecture effort there at least needs to be a “private cloud” option whereas you can take that off hub processing in house.
Some say I am a dreamer.
How many of those services are being actively used (vs yet another item in cable or alarm bill consumer signed up for, never used, forgot to cancel)?
If those HA addons were that successful, they’d be promoted more. They’re dead. Just my guess.
People who are willing to invest in installing light switches and censors (but don’t buy white glove bespoke automation solutions) are the kinds of people who check their bill and worry about recurring charges when choosing a solution.
I’d give anything to know the demographic profiles of SmartThings Customers, but I don’t think we can make any accurate assumptions or generalizations.
Perhaps SmartThings marketing team will contribute to the discussion (lol).
They are both being promoted and growing. Xfinity just a couple of months ago introduced their brand-new “quadruple play” option with home automation. Comcast says the home automation accounts are “growing aggressively.” They have now crossed the 500,000 account mark.
In fact, the Home Automation services are growing while other services from the same companies are declining.
ADT pulse reported that fourth-quarter 2015 was its best quarter ever:
Gross customer additions in the quarter were 278,000, the highest level achieved in 2015.
Data > anecdote. But I still feel in my gut that many of these customers are not active users. My intuition is based on the fact that home depot and best buy don’t carry that much HA kit. (There’s some, but not much of the nuts and bolts like contact or motion sensors.)
Edit- yes, I know about Lowe’s and have bought plenty of Iris stuff for SmartThings to use happily. Still get the feeling that I’m the only one who ever does though.
Well I think the point with the services is that you don’t buy very many devices other than what you get from the service provider and a few biggies like nest and a garage door opener. I expect most of these accounts fit what SmartThings already described as their typical user: 15 devices or less.
Linear (GoControl) has done a good job of getting their basic security set (one motion sensor, two contact sensors) into a lot of retail outlets, including Best Buy and Home Depot, and that may be the extent of the add-ons that most of the services customers need.
As I said before, there’s no way to tell how much overlap there is between that market and the SmartThings DIY no subscription fee market. What is clear is that the subscription market is making money even if there are many people in the no subscription market who personally would never pay the subscription.