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At CES 2018, Comcast announced a new Works with Xfinity program that will add a range of third-party devices to its smart home ecosystem from well-known brands such as Honeywell, Lutron, and Nest. What's significant about this announcement, however, is that these devices will be integrated into Comcast's entire Xfinity product portfolio, meaning that they will work with its TV and broadband services and applications as well as its smart home security solution. With this announcement, Comcast hasn't just extended its home automation capability; it has put Xfinity firmly at the core of the smart home experience.

Comcast puts Xfinity at the core of the smart home

Ovum has long argued that to be successful in the smart home space, broadband service providers need to make smart home offerings part of their core consumer strategy – only then can they benefit from both the new revenue opportunities and churn reduction that the smart home can bring. Comcast is already one of the most successful broadband service providers in the smart home market, with 1.08 million smart security and home automation customers as of October 2017. However, this is still a drop in the ocean compared to its total consumer broadband footprint of 23.5 million households. To maximize both the revenue potential and stickiness of smart home applications, Comcast needs to connect the mass, not niche, market.

The latest Works with Xfinity program will allow it to do exactly that. It will not only extend the Comcast ecosystem, but enable a single smart home platform that integrates third-party devices and applications into Comcast's own Xfinity services across TV, home broadband, and home security. The move means that any Xfinity customer can now control smart home devices without having to install any further specialist gateway, and that all services, applications, and devices, whether provided directly through Comcast or via one of its third-party partners, can now be controlled and managed via the Xfinity platform, including the X1 TV voice-enabled remote control or mobile (xFi or Xfinity Home) app. Interestingly, Comcast hasn't yet announced a standalone voice-enabled AI speaker, but it is rumored that discussions between Comcast and Amazon and Google are ongoing. Ovum expects such third-party devices to enter Comcast's ecosystem in the future and that X1 voice control could make its way into other devices.

Making things simple for the consumer in the connected home brings huge value. It is clear that with the number of connected devices in the home expanding rapidly, no single player will own or control them all. Accepting that devices from a range of players, including the likes of Google and Amazon, are going to be in the home and then finding ways to add value to that ecosystem in areas where broadband service providers have a core differentiation is key to success. As outlined in Ovum's upcoming report Developing Business Strategies for a Smart Wi-Fi Gateway, Comcast isn't the only, nor the first, broadband service provider to develop this type of strategy, but with its size and level of integration across all home services, it's one of the leading ones. Other broadband service providers should take note.


Further reading

Smart Home Vendor Tracker: 2H17, CES006-000005 (January 2018)

2018 Predictions: Consumer & Entertainment Services, CES003-000063 (December 2017)

2018 Trends to Watch: Smart Home, TE0003-001065 (September 2017)


Michael Philpott, Senior Practice Leader, Consumer Services

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