AT&T will launch its Digital Life smart home solution in the UK in summer 2016, in partnership with mobile carrier O2 and German smart thermostat maker Tado. This deal represents AT&T’s first foray into Europe in the consumer-facing business, as well as a possible challenge to Deutsche Telekom’s Qivicon platform, which has been available in Germany for several years and is currently being trialed by other European operators.
AT&T helps O2 reenter the home
This announcement is the culmination of over a year’s work, as AT&T had partnered with O2’s parent company, Telefonica, in 2014 to pilot Digital Life in selected European markets. AT&T will be looking for local partners in other markets, as well as local smart device makers to integrate into its platform. Tado, for example, will provide important expertise in European heating and cooling systems, which are different from those used in the US.
The fact that O2 offers only mobile services in the UK (having sold its fixed assets to Sky in 2013) is also notable – this deal presents an opportunity for the company to reenter the home, taking advantage of its brand recognition. Not having fixed assets shouldn’t be too much of an obstacle, as the telecoms market in the UK is relatively unconverged compared to that in Germany or France. Moreover, partnering with a mobile operator allows AT&T to communicate that Digital Life is available to customers regardless of their fixed broadband provider, whereas partnering with BT or Virgin would give the impression that customers of other providers can’t use the service.
What may prove an obstacle, given O2’s lack of a fixed brand, is getting an additional hub device into the consumer’s home in a cost-effective way, particularly given that O2 won’t be the provider of the core router.
Longer term, AT&T will aim to partner with carriers in other European countries, so it is likely to run into competition from Deutsche Telekom’s Qivicon platform, which is being trialed by other European operators, though no wholesale deals have yet been announced. Another player offering wholesale deals is D-Link, whose mydlink platform is being deployed in Italy by Telecom Italia and in Germany by O2.
Connected Home: AT&T Digital Life builds on security monitoring to break into home automation, TE0001-000887 (October 2014)
Smart Home: US Providers Open Up Platforms as Market Grows, TE0001-000992 (September 2015)
Francesco Radicati, Senior Analyst, Digital Services