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Tech Companies Crash the Connected Home, Make a Mess


Homeowners don't like to take risks. Tech makers don't like to take their time. It's a bad combination.

Samsung (KRX:005930) isn't known for its kitchen gadgets, but the Korean conglomerate is trying to change that. "There's a lot of room for innovation in home appliances," co-CEO Boo-Keun Yoon told Fortune magazine earlier this year. The Samsung smart refrigerator is one such innovation. It runs Android and boasts an 8-inch touchscreen, embedded just above the water dispenser. The idea of a Youtube-enabled fridge has, at times, been met with ridicule, but Amazon (NASDAQ:AMZN) reviewers seem to like the functionality. What they don't like are busted icemakers and broken doors; Samsung's appliance has been pilloried for mechanical issues.

Nest Labs has a similar problem. Founded by a pair of former Apple (NASDAQ:AAPL) engineers, this startup made a name for itself several years ago with the Learning Thermostat, a smart climate controller. The device looks like something designed in Cupertino: It's simple, beautiful, and intuitive, in the best tradition of consumer tech. It also goes berserk on occasion, turning houses into ovens or iceboxes. In fairness, most buyers never experience this problem – but it's still remarkable, in this day and age, for a thermostat to fail so completely.

The connected home can be a tough environment for technology-focused companies, who typically like to "move fast and break things." The reality is that most homeowners aren't risk-takers. When we buy appliances, we expect them to last. When we install thermostats, we expect them to function. When we sign up for home security, we expect it to be reliable. The costs of failure can be huge, so above all, things need to work.

In other words, there are advantages to taking a conservative approach – but tech firms don't always like to slow their roll. The Nest Protect smoke alarm, for example, will speak to you, interpret your arm motions, and even act as a night-light. But because it lacks an ionization sensor, it's less effective at detecting fires than devices that run a fraction of the price. Canary might be "the world's first smart home security device for everyone," but it breaks the mold in other ways, too. The video camera/motion sensor lacks a backup battery – a common feature in traditional security systems – and is so visually inconspicuous that would-be intruders are unlikely to notice, much less be scared off by it.

And because many of these appliances are intended to be Next Big Things, you can be sure that they'll demand your attention whenever possible. With the Ecobee smart thermostat, "it's never been easier (or more fun) to monitor your home's energy consumption." Bitponics will formulate a Grow Plan for your household plants, and alert you when they need water. Lockitron can shoot you a notification "when your child unlocks the door using their phone or key." If LG (KRX:066570) has its way, washing machines and robotic vacuums will soon be sending you texts. These ideas might all have merit, individually, but throw them together and you're looking at more noise and self-adulation than a Facebook (NASDAQ:FB) News Feed.

The rising stars of the smart home may well be "dumb" companies like Honeywell (NYSE:HON), which has been in the thermostat business for a century. The Honeywell smart thermostat isn't as sexy as Nest's product, or as smart as Ecobee's, but it is reliable. Nor does it require so much pampering; Honeywell has partnerships with home automation systems like AT&T's (NYSE:T) Digital Life, giving its devices the ability to blend smoothly into the grand scheme of things. That could be important, if connected devices proliferate and homeowners no longer have the time (or patience) to deal with them piecemeal. Despite being late to the game, Honeywell now holds a commanding lead in smart thermostats, according to Navigant Research.

In the end, Samsung is probably right. There is room for innovation in household appliances. What there may not be room for is disruption. Success in the connected home will mean learning – and appreciating – the difference between the two.

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