The building automation market is an expanding global opportunity, with growth underpinned by the decreasing cost of hardware and networking technologies, increased construction activity, and initiatives taken by governments to promote sustainable smart buildings and smart city initiatives, amongst others. As building automation systems have become more affordable, now even small and mid-sized apartment owners are using automation to control buildings. Previously, these systems were not usually deployed in sparsely occupied buildings such as warehouses and garages but with increased affordability, these systems have applications in such non-traffic areas as well.
This report summarises the status and forecasts from the Building Automation Application Group found in the Transforma Insights Connected Things IoT forecast. The report provides a description of what is covered in the Application Group, as well as top-level figures from the forecast that provide detail on how many connected devices will be installed, the types of communication technology used and the total revenue opportunity.
A full set of forecast data, including country-level forecasts, sector breakdowns and public/private network splits, is available through the IoT Forecast tool.
The “Market development” section begins with a list of the drivers that are expanding the building automation market, such as various government initiatives and increased construction activities.
It then discusses how the evolution of IoT technologies has made building automation systems more powerful, less expensive, and more accessible than before. Apart from financial advantages, the indirect benefits of deploying building automation systems (such as better lease rates, valuation, and sales price) have been discussed here as well. For instance, an EU Commission report claimed that smart buildings have 12% better lease rates than non-smart ones and their sales price and valuation can also be 3% to 25% higher.
It also mentions the connectivity technologies used in these including Wi-Fi, mesh technologies (ZigBee, Z-Wave), Bluetooth, Ethernet, and powerline communication, and their advantages over one another.
It then expounds on how smart cities (mostly government-led ones) are accelerating the adoption of building automation systems, especially in countries like China, South Korea, India, and Japan. The discussion in this section also includes new mergers, partnerships, and innovations that are enhancing the capabilities of building automation systems (which have edge processing capabilities and use advanced network technologies). To cite an instance, in 2021, IOTech Systems teamed up with Building System Integrators to provide advanced equipment connectivity, edge processing, and edge management capabilities for enterprises that have mission-critical requirements.
The Building Automation category comprises three areas: Building Automation Systems, Air Quality Monitoring, and Water Flow Detectors.
This section talks about how various governments are becoming increasingly concerned about high energy consumption in buildings and are therefore, coming up with firm energy-efficiency policies, which are encouraging the installation of building automation systems. For example, through the Public Services and Procurement Canada (PSPC), the Canadian government started implementing the Smart Buildings Initiative, and by 2017, the government had installed monitoring and control systems in 13 buildings in the National Capital Region and saved 17% energy (equating to CAD1 million or USD0.8 million) annually.
It also lists some of the benefits (like reducing a building’s carbon footprint) and challenges (lack of clarity on the return on investment and payback period) of deploying building automation systems. Some examples of relevant IoT deployments in this application have also been included here like the 250 Villas in Al Barari deploying Pacific Controls' U-home automation system.
This section begins with an explanation of the increasing air pollution levels and environmental concerns being the main drivers behind the growth of the air quality monitoring system market, resulting in various governments setting air quality standards and taking measures to monitor indoor air quality.
It then focuses on countries with high outdoor pollution levels, which necessitate which necessitate monitoring pollution levels (North American and East Asian countries, especially China, Japan and South Korea are at the forefront in the adoption of air quality monitoring systems). It also lists some of the barriers (like the lack of mandatory requirements by governments) which may hamper their adoption, especially in developing countries.
There are some examples of relevant IoT deployments in this application as well. For instance, the Grosvenor Group deployed Aeroqual's AQY 1 air quality monitors in and outside its shopping centres, eventually identifying the high-impact zones in those areas.
This section of the report discusses the drivers behind the increasing adoption of water flow detectors (like the increasing demand for smart sensors to measure water consumption and reduce water leakage). It then lists some of the benefits of deploying such monitors, like monitoring excess water flow, reducing wastage, and preventing the growth of bacteria like legionella in water.
It also talks about the increasing product offerings (like Resideo’s Wi-Fi-enabled and battery-powered water leak and freeze detector sending notifications on detecting a frozen pipe or a leak) and the heightened rate of innovation in network technology in the context of the arrival of cellular LPWA technologies. It also lists some of the potential barriers which may limit their adoption in future (like smaller houses and buildings that don’t require the detection of the precise location of a leak may deem installation of separate leak detectors irrelevant).
This section also provides some examples of relevant IoT deployments in this application like the Dubai Exhibition Centre partnering with TTK to deploy a water leak detection solution.
The key vendors section lists some of the main providers of products and services related to the market such as ABB, ADT, Aeroqual, Emerson Electric, Honeywell, Johnson Controls, Samsung SmartThings, Schneider Electric, Siemens, and Vivint. The report provides profiles of the various vendors including aspects most relevant to this Application Group, such as product offerings, pricing, financial results, and technology.
In the market forecasts section, we provide a summary of the forecasts from the Transforma Insights IoT Forecast Database:
The report charts the growth in the number of building automation devices which will grow from 856 million in 2023 to 2.4 billion in 2033.
Transforma Insights forecasts are compiled on a country-by-country basis. This report includes a regional summary, showing splits between Australasia, Greater China, North America, Europe, Japan, Latin America, MENA, Russia & Central Asia, South East Asia, South Korea, India & South Asia, and Sub-Saharan Africa.
Transforma Insights’ IoT forecasts include splits between the various connectivity technologies as follows: 2G, 3G, 4G, 5G mMTC, 5G non-mMTC, LPWA (non-mMTC), Satellite, Short Range, and Other.
This section discusses which technologies will be used in the building automation application group.
This part of the report discusses the market growth in terms of revenue (module revenue, service wrap revenue, and VAC revenue). Transforma Insights estimates that the revenue in the Building Automation Application Group will grow at a CAGR of 11%.
