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Summary

Deutsche Telekom (DT) made a series of announcements last week to support its ambitions of becoming one of the leading smart home platforms in Europe. To achieve this, it needs to increase the breadth and functionality of its platform, expand its geographical footprint, and of course gain more customers. The company's announcements last week covered the first two areas, so it must now focus on ramping up customer growth.

 

Usability and geographical reach are important growth drivers

DT announced that it had integrated the Home Connect platform, which works with Bosch and Siemens connected devices, into Qivicon to enable greater functionality between the two. For example, as well as being able to control connected Bosch and Siemens appliances directly via the Home Connect app, consumers can use the broader Qivicon ecosystem to, say, provide a visual or audio signal once a wash cycle or cooking timer has finished. Enabling a wider set of use cases to add value to connected appliances beyond basic smartphone control will be as important to vendors Bosch and Siemens as it is to DT.

Secondly, DT announced a number of new compatible devices to broaden the Qivicon portfolio, such as the Nest Protect smoke and CO alarm. It also announced a new service provider partner in the form of Cosmote, the largest mobile operator in Greece and part of the OTE group, adding Greece to Qivicon's current footprint of Germany, Slovakia, the Netherlands, Austria, and Italy.

Geographical coverage is important, but customer scale is what will really start to enhance the Qivicon brand, especially among potential partners. No details are yet available on the total number of consumers using the Qivicon platform, but DT had 256,000 smart home subscriptions in 4Q17. Although DT's smart home subscriptions grew by 87% over 2017, it still has, say, only 30% of the number of Centrica's UK retail smart home subscribers, and Centrica has expanded its platform to the US and Italy (with Eni gas e luce). A real focus for DT in 2018, therefore, must be to drive mass-market adoption.

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