Energy Information Displays: Moving to a Free Model?

Earth2Tech has been closely following the flurry of activity in the home energy management arena in recent months, of which Energy Information Displays (EIDs) are a key component. Product offerings in this burgeoning space range from robust home automation and control systems from companies like Agilewaves and Tendril Networks to the high-profile announcements by Google and Microsoft that they will launch web dashboards to enable better consumer management of home energy usage. Other vendors actively pursuing this opportunity include Control4, Energate, EnergyHub, Greenbox Technology, GridPoint, and Onzo.

Pike Research recently conducted a survey of 1,041 consumers to gauge interest in, and willingness to pay for, EIDs and related services. The full results are detailed in our GigaOM Pro report, “Home Energy Management: Consumer Attitudes and Preferences” (subscription required). The survey found that consumer interest in EIDs is strong: 52 percent stated that they would be “extremely” or “very” interested. Of these interested parties, nearly half said that they would prefer to take an active role in monitoring and controlling their home’s energy usage settings on a regular basis. Even more telling, 66 percent of respondents expressed a willingness to pay for EID functionality, either in the form of a one-time purchase or on a subscription basis.

But, as EID product offerings become reality over the next few years, will consumers actually have to put their money where their mouth is? Perhaps not. Google’s PowerMeter dashboard is being offered free to users, and the company has declared that there is “no business model” behind it. (For more on this read Katie’s article on Where Not to Make Money: Energy Management Software on GigaOM Pro). Microsoft’s Hohm is likewise being offered on a free-to-consumer basis and, with the Microsoft Advertising platform in the mix, will be partially ad-supported in addition to the fees that will eventually be collected from utilities.

With these big moves by Internet titans offering free dashboards, other EID contenders are already under pressure to prove the value of a premium product. Some will undoubtedly succeed in staking out a niche market among consumers who crave high-end functionality. But, if the history (and size) of the home automation market in recent years is any guide, my bet is that the mass market will be perfectly happy with “free,” and products such as PowerMeter and Hohm are sure to keep most consumers satisfied with additional layers of smart meter and smart appliance integration over time.

There’s nothing quite like a market disruption that occurs before there’s actually a market.

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