The Internet of Things (IoT) industry regards commercial and industrial buildings as the third most important market for its technology and products.
Not surprising... given that the world market for all types of Building Automation Systems (BAS) for these buildings was $120Bn in 2014 and will grow at around a CAGR of 9% to reach a $155Bn in 2020; Not including the technical market potential of a further $76Bn when delivering the ultimate in fully automated Building Internet of Things (BIoT) systems - http://memoori.com/portfolio/transformation-BAS-to-BIoT-2015-2020/
It would appear that much more effort and focus on removing the obstacles is going to be required by both the suppliers of BAS services and the IoT industry if it is going to realise this massive latent potential.
The objective of integrating all the different BAS services is to improve the performance of buildings. There is a natural interrelationship between all these technical services and our report The Transformation of BAS TO BIoT 2015 – 2020 shows why 9 different BAS systems from environment controls through to video surveillance will make an exponential improvement in performance delivering a fully automated systems that do not require the intervention of humans.
There seem to be a number of road blocks that are holding back the rapid growth anticipated by the pundits a year ago. The first is that the BAS suppliers are not convinced that they will get a meaningful share of this additional business and believe that in the worse case they could loose business to the IoT software providers. There is no doubt that currently the initiative and investment in BIoT’s development is being made by this IoT contingent and if this continues they will become the dominant force in this business.
They hold all the new technology to deliver the IoT for a fully automated building but they know little about the design, installation, operation and servicing of buildings; which is still "owned" by the manufacturers of BAS systems and in addition they have direct access to a vast heritage estate that will need to be retrofitted.
These two camps need to be brought together to combine their expertise if the full benefits of BIoT are to be realised and meet the customers buying proposition. The major international BAS players are already forming alliances with IT Communications and Software companies to offer turnkey projects, but we have yet to see all the fruits of their work.
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To get BIoT to market requires a new supply chain to be put in place and this will cause a major disruption to the BAS suppliers. We see the supply chain being formed around 4 main contracts.
The first being the supply of the BAS services; so no problem here as they keep the status quo with each BAS service contracted separately (but just the supply of hardware installed, no enablement hardware or supervisory software). We expect Contract 2, the supply of Enablement Hardware, to be a subcontract to Contract 3 but this will depend upon the size of contract and whether it’s a new construction or retrofit project.
Contract 3 will be the supply of Network Communication Services, requiring IT Communication skills and the bidders will be companies already providing this in other applications. Contract 4 will be IoT Data Services and Big Data Analytics which will be bid by companies that are already building sophisticated software. However this will not apply across all buildings and for the small / medium building sector software services will be less sophisticated.
These and a few other important stalling points such as Cyber Security - http://memoori.com/building-automation-cyber-security-taken-seriously-enough-iot-age/ - we hope will eventually be overcome. Now is the time to get the BAS industry to position itself and move forward to take full advantage of the Building Internet of Things.