By Lisa Arrowsmith • IMS Research
Let’s start with a buzz; according to a recent study from IMS Research, ZigBee adoption increased by more than 200 percent from 2009 to 2010, with a ramp up from 10.4 million ICs shipped for certified ZigBee devices in 2009, to more than 30 million last year.
Surprised? If I’m honest, I was. So what applications were actually using ZigBee technology? And, more important, will ZigBee adoption continue to grow in the coming years?
Four segments – smart metering, residential automation and HAN, commercial building automation and consumer electronics – accounted for most growth from 2009 to 2010 in shipments of ICs using certified ZigBee standards (including ZigBee RF4CE).
Advanced Metering & Residential Home Area Networks
In 2009, smart metering accounted for just over 5 million units, around half of all ZigBee shipments. It was estimated to increase to more than 12 million in 2010, largely because of a mid-year surge in meter roll-outs in North America.
With the growing momentum of the upcoming ZigBee Smart Energy 2.0 development, which will specify an IP stack including 6LoWPAN to replace the ZigBee network layer previously used, uptake of ZigBee in smart metering applications is forecast to grow by an average of more than 35 percent a year from 2009 to 2015. This in turn gives ZigBee IC and device suppliers further access to the emerging market of home-area network (HAN) devices; facilitating ZigBee-enabled in-home devices to communicate with smart metering gateways and, once the associated infrastructure and business models are in place, to react to demand-response signals from utilities. IMS Research forecasts that ZigBee shipments for residential automation and HAN applications will grow from fewer than 3 million in 2009 to more than 20 million in 2015.
Commercial Building Automation
There are many reasons to implement a building management system, as well as the potential to improve user experience (e.g. in the hospitality industry), more compelling is the promising ROI argument, due to factors such as improved electricity management and reduced maintenance and human resource costs.
From 2009 to 2010 the annual uptake of ZigBee technology in commercial building automation applications is estimated to have more than doubled. While this sudden surge may be predominantly linked to factors such as heavy activities by a single semiconductor supplier, as well as the fulfillment of delayed orders planned for the 2008 to 2009 period, IMS Research forecasts growing uptake of ZigBee technology in this segment. Further growth will be driven by the upcoming ZigBee Commercial Building Automation profile, which integrates BACnet tunneling. According to IMS Research’s projections, more than 30 million ICs will use ZigBee technology for commercial building automation applications from 2009 to 2015.
Consumer electronics represent a huge potential market for wireless RF technology, because so many consumer devices use a remote control. Since its completion in early 2009, ZigBee RF4CE has shown early signs of uptake by consumer electronics, which is moving from basic unidirectional IR solutions towards bi-direction RF technology for remote controls and other home entertainment peripherals.
The support of ZigBee RF4CE by some consumer electronics providers is already evident. In September 2009, Philips announced the availability of the first ZigBee RF4CE-based remote control. Other consumer electronics and remote control manufacturers, such as SMK Electronics Corp., Hillcrest Labs, Sony and Vestel have followed suit. In July 2010, LG Electronics and Toshiba joined the ZigBee RF4CE Steering Committee, demonstrating further support for the standard from consumer electronics giants.
While a great opportunity exists for low-power wireless RF to penetrate a myriad of consumer electronics via inclusion in remote controls, the transition from IR to RF may be slower than some industry organizations are suggesting. IR controls have been used for around 30 years, and are widely deployed. Despite their limitations, they cost less than RF solutions (this is especially important given that, in the majority of cases, consumer electronics manufacturers must purchase two IR or RF chips – one for the remote itself, and another for the device being controlled). For some manufacturers, especially those not marketing their products as ‘top-of-the-range’, price is the primary factor in many designs; this may slow the adoption of RF in remote controls.
Growth in the use of ZigBee RF4CE will depend heavily on the development of further applications for peripherals that require a connection to home entertainment hosts, such as TVs, set-top boxes and Blu-ray players. For example, one application forecast to contribute to growing ZigBee RF4CE adoption is the 3DTV, leading to the development of ZigBee 3D Sync. Equally, other sophisticated applications are starting to emerge for technologies such as ZigBee RF4CE. As device makers and the associated service providers look to differentiate themselves, a wave of new use cases for traditional consumer devices such as set-top boxes will emerge.
ZigBee Diversification: What’s Next?
As well as continuing with efforts in existing application areas, the ZigBee Alliance and its partners are working on breaking into a number of new application areas, including the telecoms and retail sectors.
Seven billion cellular handsets are forecast to be shipped from 2011 to 2015. They will be prime real estate for wireless radios; adoption in even a few handset models can equate to large unit shipments. Additionally, it can stimulate uptake of low-power wireless technologies into peripheral devices, such as sports and fitness monitors and consumer healthcare devices.
In March 2010, the ZigBee Alliance announced that development of the ZigBee Telecom Services standard had been completed. The standard was developed in conjunction with a number of telecom operators and technology companies, including Telecom Italia, France Telecom, Telefonica, KDDI, Huawei, Motorola, ETRI and OKI Semiconductor.
ZigBee Telecom Services can offer a number of exciting new applications for ZigBee technology, defining a methodology for providing services including: information delivery, indoor location-based services (LBS), secure mobile payment, mobile gaming, push-to-talk (PTT), peer-to-peer data sharing and physical access-control management services.
Yet the flight of Zigbee Telecom Services to direct integration in cellular handsets won’t be that simple. In a very competitive field, an additional radio in a handset must be worth its space and cost. In the short and medium term, there may be difficulties with the relative immaturity of the ZigBee Telecom Services profile, the lack of devices that enabled handsets could communicate with, and the uncertainty over how services could make money out of integrating the technology. Alternatives to direct integration may be considered, such as carrying the Zigbee radio on an after market SD memory card, or on the SIM card. This fits well with the ZigBee Alliance’s aim of enabling mobile operators to offer new, low data-rate, services, such as those mentioned above. There has been progress here, with ZigBee-enabled SIM cards said to have already been developed for GSM phones for both the European and Korean markets.
The ZigBee Alliance is certainly not one to gamble on a single application, as demonstrated by its continued strategy of diversification. In January 2010, the ZigBee Alliance announced it had started development of ZigBee Retail Services, aimed at a wide range of use-cases, including managing in-store information, supply chain management and regulatory compliance services such as ‘freshness’ tracking for perishables, among many others. With this as the ninth standard from ZigBee Alliance (alongside ZigBee Smart Energy, ZigBee Home Automation, ZigBee Remote Control, ZigBee Input Device, ZigBee Health Care, ZigBee Telecom Services, ZigBee 3D Sync and ZigBee Building Automation), many are waiting with baited breath to see what comes next and which will bring the honey.
ZigBee: Watch out for the Sting?
There are still a range of challenges awaiting ZigBee suppliers. Companies face different issues, depending on where they are in the ZigBee ecosystem.
For IC suppliers, with the dramatic growth in ZigBee uptake there is the risk of commoditization, in terms of both the IEEE 802.15.4 hardware, as well as the associated ZigBee network layers. In order to manage this risk effectively, IC suppliers will need to either be confident that their designs and costs can be improved to maintain sufficient margins, or that they can develop features to differentiate their products.
For device manufacturers, the nature of ZigBee technology means that a clear marketing strategy needs to be employed, particularly for B2C companies, to ensure that the general public understand which ZigBee products will work together. Reputation is quickly damaged by disappointed customers; for example, if they bought a ZigBee RF4CE remote control to operate a ZigBee PRO thermostat.
The ZigBee Alliance itself has the responsibility to continue strong marketing efforts to promote the ZigBee technology in the face of others such as Bluetooth, low-power Wi-Fi technology, EnOcean and Z-Wave.
ZigBee: Show Me the Honey!
IMS Research forecasts rapid growth in the adoption of ZigBee technology. In its recent projections, it predicts that ZigBee adoption will increase from little over 10 million ZigBee solutions shipped in 2009 to over 300 million in 2015; as its utilization grows in a wide range of both existing and emerging applications. There will be challenges, with no shortage of competing low-power wireless solutions, technical and marketing efforts must be maintained for the Alliance and its member companies. If they maintain focus, there’s every chance of honey!
Statistics and forecasts within this article were taken from a recently published report from IMS Research, ‘The World Market for Low-Power Wireless – 2011 Edition’. Please contact Lisa at +44 1933 402255 or Lisa.Arrowsmith@imsresearch.com to discuss this article, or the full report, in more detail.
The rights to all information, statistics and forecasts included within this article (including copyright) are reserved to IMS Research.