Thursday, December 2, 2010

Motorola Buys 4Home...a Sign of Things to Come in #SmartGrid?

Yesterday, Motorola announced that they're acquiring 4Home, one of the industry's leading software solutions for the connected home. In addition to being really good guys, the 4Home team has done a great job building out a very cool platform for a number of home applications, including energy management.

At first pass, I said "A cell phone company is acquiring a team that does set-top and embedded device work? What the heck?" Then I quickly remembered that Motorola bought GI about a jillion years ago. I still can't get used to saying "Motorola" when talking about GI, nor do I readily say "Cisco" when I actually mean "Scientific Atlanta". Then again, Motorola's lost enough brand equity in cell phones that I've regressed to thinking of them as a military radio purveyor, but hey.


I love this deal. While I'm skeptical based on Motorola's stock performance the last three years as to whether this was a good deal for 4Home (although in this market, any exit is a good exit), this could be the lever that really gets Smart Grid platforms rolling, particularly for those operators under the CableLabs umbrella. Motorola/GI and Cisco/SA have at least a hundred million set-top boxes installed in the U.S. alone...which could be one helluva Trojan horse. If Motorola can demonstrate to their operator customers that they've integrated a lightweight software platform from 4Home, you could see a very rapid ramp-up of managed service provider offerings for energy management and home security & automation.

Why? Well, the math is pretty compelling for a third party service provider (let's say Comcast) to offer me a home energy management system (HEMS) based on a set-top box which is already in my home. If I take that set-top box and bridge it into my home network (either via my cable modem or via a built-in comms port like MoCA or Ethernet), I can now readily view and control the energy consumption of the devices in my home, all via my TV or a smart phone application--with no new hardware cost for me as a customer, or for my service provider. Simply by downloading new software onto my existing set-top, I'd end up with a form of consumer Energy Services Interface (ESI), functioning as the heart of my HEMS.

Would it be perfect? Unlikely. My Comcast EPG sucks, and the fact that my dual-tuner box can't do picture-in-picture in 2010 is mind-boggling (particularly since my UltimateTV box designed in 1997 did so, with a fantastic UI to boot), but I'll take the good with the bad. Frankly, it's also likely that a significant number of those hundreds of millions of set-top boxes would be resource-constrained, unable to run the 4Home software stack, no matter how light that software load might be.

Regardless, the pay-TV and telecommunications markets have talked about convergence for many years. Yesterday, one of the world's biggest players in the set-top box space took a significant step towards hastening convergence between consumers, communication, control, and energy.

Your move, Cisco.

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