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Is there a smart home in your future? part two

For my dream house, I wanted the usual smart home technology - audio, video, security, surveillance, communications, and other control functions I would probably never use. The catch was that I also wanted it to be easy to use, upgradeable, integrated, an

Steve Tobak
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Steve Tobak is a consultant and former high-tech senior executive. He's managing partner of Invisor Consulting, a management consulting and business strategy firm. Contact Steve or follow him on Facebook, Twitter or LinkedIn.
Steve Tobak
3 min read

Yesterday was the setup for an eye-opening smart home adventure for my new custom home. Here's the conclusion:

I found lots of solutions that weren't robust enough for my application. One of the best was by Control4, a venture-funded startup in Salt Lake City, Utah. Control4's products are wireless and perfect for retrofitting an existing home since they don't require structured cable. Still, I had the luxury of wiring the house, which in my perhaps overly-conservative way of thinking is more bulletproof than wireless, so I kept on searching.

The best solution I could find for new home construction was Lifeware by Exceptional Innovation. Lifeware integrates with Windows and now Vista Media Center, creating a single interface and relatively seamless integration between subsystems. I even found a contractor capable of designing, networking and installing all the subsystems.

I was more than a bit queasy about Microsoft having any part in controlling my home. What if it crashed? Would the whole house turn blue until I rebooted it? And how exactly do you reboot a house? What if a virus or a worm or spyware got in? But Lifeware was supposed to be bulletproof, so I temporarily set my fear aside while I awaited the all important price-tag.

I was really excited to get the contractor's proposal. I involuntarily held my breath as I opened the attachment and then scrolled down to the bottom of the six-page document. After the initial shock wore off, I was finally able to breath again. I called another vendor for a sanity check. Same thing.

I wondered if these people were smoking something or maybe I'm just cheap? I didn't believe the latter, since I was building a relatively expensive home. I'll let you decide. Here's the math:

Let's say, for the sake of argument, you're building a house for $1 million hard construction cost. In California that translates roughly to a $2 million house, including land (big-time around here) and soft construction costs like architecture, permits, and other fees.

Out of the $1 million hard cost, how much would you say is reasonable to allocate for the kind of smart home stuff I described earlier? I mean, we're not talking The Jetsons or Star Trek here, just plain vanilla stuff. How much?

I thought 5% or $50K would be reasonable. Sounds about right, doesn't it? Well, get this: the Lifeware implementation from both vendors would have been well over $100K! That's over 10% of the hard construction cost. Now you know why I almost needed CPR.

At that point I did some soul searching.

I ended up hiring a vendor that one of my other contractors had worked with in the past - a second-generation family business that had been around for decades. They used technology from Elan Home Systems plus subsystems from a handful of other companies. It's not as seamlessly integrated, scalable, or easy to use as I would have liked, but it pretty much does what I wanted and at a price I could live with, i.e. in the $50K range for that size home (that's excluding monitors, by the way).

Conclusion: I don't know about you, but I don't consider $50K, let alone $100K +, to be a cost-effective smart home implementation for most families. Granted, there are lower cost solutions like Control4, but they certainly couldn't fulfill this computer geek's hopes and dreams. At the end of the day, smart home technology is out there, if you're willing to settle for a lightweight solution, you don't mind if it's kludgy, or if you can afford a hefty price tag.

I've heard that the home automation market is ready to take off. From a business standpoint, it's a huge frontier for computer and consumer electronics companies. Sure, we've come a long way in 25 years. But when it comes to terms like convergence, ease-of-use, integration, interoperability, and the digital lifestyle, IMHO, we're still closer to the beginning than to the end.