Feeling Right at Home
Feb/Mar 2013
Mike Carrozzo, Chief Editor

Utz Baldwin slumped down in his seat just a bit. Such a subtle movement would not be noticed by the many in attendance all around him at the Hyatt Regency Silicon Valley that October evening. But it was enough to demonstrate just how disappointed he was at that very moment. Up until that point he was thoroughly convinced that his group had nailed it. In a sense, Baldwin thought how could the name ube—that of his latest start-up company designed to simplify the idea of home automation—not be among the select set of ‘DEMOgods’ for the evening?

Such an honor is bestowed on only a select few groups of technology startups who are able to deliver their idea on stage in the form of a live presentation (no PowerPoint allowed) in the matter of 360 seconds. When you think about the prospect of communicating your message to meet the criteria—style, passion, clarity, and at times sheer outlandishness—360 seconds doesn’t seem like a whole lot of time. But when you realize the DEMO event of which this is a part of has helped such brands as salesforce.com, E*TRADE, Leapfrog, TiVO, and Adobe Acrobat, to name a few, migrate from obscurity to infamy, you realize the magnitude of being a part of DEMO in the first place.

Certainly the challenge bequeathed to Baldwin by cofounder Glen Burchers years earlier to “bring me the next start-up idea” had to be going through his mind at that very moment. At the time Baldwin was coming off a fresh parting of the ways with the largest home-automation custom installation association in the country, CEDIA, where he acted as CEO for roughly three years; while Burchers was itching to move away from the corporate world, where he was at the time designing technology for Freescale Semiconductor, and back into the start-up world, where he was a part of five successful endeavors previously.

The idea Baldwin brought to Burchers that day, of a connected-home solution that leverages the processing power of mobile devices and the ubiquity of the cloud, would evolve to become ube. The idea just needed some time to coalesce.

That time, Baldwin was certain, had arrived that October evening. Yet, to Baldwin’s dismay, the name ube wasn’t called. That is, until it was.

“It’s not too often that you get to hold a $1 million check in your hand,” says Baldwin, recalling just how overjoyed he, Burchers, and three of their ube colleagues were as they stood on the DEMO stage that evening. While the ube group wasn’t one of the six DEMOgods of the evening, they instead were the winners of the People’s Choice Award, an exclusive multimedia advertising package in the form of $1 million. Chosen by members of the media, technology, and venture capitalist communities in attendance that evening, ube beat out 83 others for the honor.

But, as Baldwin describes, there was no time to celebrate. “All I could think about was that the very next morning we had venture capitalist meetings. We had to make sure the demo and presentation was right.” There was no time to get caught up in the moment. Besides, when you are sitting on a ground-breaking idea poised to transform a smart-home market that has been begging for someone to take hold for more than two decades, there would be plenty of time to celebrate later.

And that is what Baldwin and Burchers believe makes ube so special today. “Connected-home technology has been around now for two decades and the technology used for successfully delivering home automation is essentially the same as it was 20 years ago,” says Baldwin. “There is a central processor located in (a) home that communicates with subsystems, but requires a lot of proprietary hardware and a lot of lowvoltage infrastructure. And the worst part is that custom software (still needs to be) written for every IP address in order to make it all work.”

In his opinion, very little has been done in terms of innovation as it relates to control systems for the home. That simply won’t suffice for a market that, according to the estimation of Baldwin’s old stomping grounds CEDIA, is valued at roughly $14 billion annually. The fact of the matter is the bulk of this investment is being made by homeowners who are considered to be living by “affluent” standards in larger-scale homes. It is a fact he knows all too well, once being the owner of a company that designed and installed home-electronic systems for the rich and famous.

But today the real opportunity exists on the opposite side of that spectrum. It is with average consumers, who, thanks to the advent of the smartphone, have become much more willing to embrace a little automation in their lives so long as it doesn’t cost too much. They are comfortable with the connected world.

“So we believe the time has come to prove the Internet of Things is real and achievable and that the technology in this industry can be democratized and does not have to be something for only the very wealthy,” Baldwin adds.

Democratize. It is a word Baldwin uses repeatedly when describing the opportunity that exists for the ube platform today. To break it down, the low cost involved with giving any device an IP address these days, coupled with the ubiquity of Wi-Fi in homes today presents a market where the smart home can be had by one and all. A democracy of home devices, if you will.

And like any good business partner, Burchers concurs. “What gets me excited about this opportunity is the understanding that it is so inexpensive to add connectivity and intelligence to a device. … Semiconductor solutions today allow you to take a device and microprocessor and operating system and give it an IP address for under $4.

“That is amazing when you consider the amount of processing power you can put into a device for that price. Then also utilizing the technology available in mobile devices, you can add wireless connectivity for another few dollars. So for under $10 you can add all of the processing and wireless connectivity required to give a device an IP address, as well as the intelligence and connectivity.”

This low-cost message is certainly resonating in the consumer-electronics market. Take connected TVs, forexample. According to the Consumer Electronics Assn., total U.S. factory sales for televisions in 2012 were 31 million, 10 million of which were IP-enabled and valued at $9 billion. Likewise, the total number of Blu-ray players on the market in 2012 was 10.6 million units, 9.8 million of which were IP-enabled and valued at $800 million. Numbers like this go to show that IP-enabled products are beginning to take the lion’s share of a product segment, with these two examples being just the tip of the iceberg. As such, several existing CE product categories still lack truly rich IP-based controls. One of these is lighting control—but we will get to that a bit later.

Speaking to the topic of widespread Wi-Fi ubiquity, Burchers adds, “For the past decade companies had been trying to connect devices, but had to use protocols that were not standard and wireless interfaces that were not as pervasive. For example, you had a lot of Zigbee-based control, which three or four years ago you could say was less costly and lower power than Wi-Fi. That is no longer the case.”

Market penetration is certainly on the side of Wi-Fi. Analyst firm Parks Associates projected by the end of 2012, the number of Wi-Fi households was poised to reach 60 million, representing just shy of 50% of all U.S. households. This number certainly represents an upward climb, especially if you consider the 44.5% of U.S. households with Wi-Fi in 2010, as cited by fellow research firm ABI Research.

But it’s not just the advent of Wi-Fi that is pushing the boundaries of the smart home. “The pervasiveness of IP has helped,” Burchers adds. “I think everyone started to realize, especially with the advent of IPv6 and having addresses for so many devices, that IP would become the standard interface. Having that standard interface is what is allowing us to create one platform that controls everything without the need to have a bridge or a dongle or a gateway. The idea of going directly from the cloud to the device or handset to the device makes it very easy.”

Such a confluence of factors helps create the idea of turning any iOS or Android device into a central controller—via an app, of course—for all M2M-enabled devices in the home. And that, in essence, is where the ube story starts. The ube app allows homeowners to control any and all IP-enabled devices for the home without any additional hardware. Commands are sent directly from the smartphone to the device. Say, for example, you have a smart TV or set-top box; the app sends commands to that device using your local-area network. There are no dongles or bridges required; just your router and, of course, devices residing on the network.

But what about all those existing apps available from the product makers? While it is true some device makers offer their own app for controlling their products, the truth of the matter is the convenience factor associated with such apps, for the most part, falls flat. Take, for example, the fact that you have one app to control your smart TV and another app for your set-top box. The idea of convenience flies out the window when you ask a consumer to navigate in and out of these two apps in order to carry out the simple task of watching a television show.

“Remote controls can be daunting out of the box, but the fact is most control companies are trying to use iPads and iPhones (as controllers) but provide no technical feedback,” says Baldwin. This is the part where ube starts to think “mass adoption.”

ube has incorporated things like gesturing into its app, which Baldwin describes as essentially creating a blank canvas for usage. “So if I select DirecTV, there are no buttons, I just swipe up and down to adjust channels or do a clockwise rotation to adjust volume,” he adds. “Suddenly you can pay attention to what is going on in big screen and not the little screen.”

Burchers concurs, “Our goal is to create a fabric that stitches all (devices and apps) together and controls them from one platform.” It seems like a lofty goal, but at launch ube had 200 major CE brands included under that “fabric.” If Burchers has any say in the matter, that number is merely a modest start.

“We are engaged in conversations with OEMs with the idea of can we develop relationships with them so that we can be both frontend and backend for major hardware makers,” Burchers describes. He says while some companies offer an app to control their products, they believe the app is not a value-add for them. They have limited options for knowing how customers are using their product, but they could. “There are so many great business relationships that could be formed and we are working hard on that.,” he adds.

Part of what could be so appealing to these device makers is the fact the ube app will be constantly working for the product makers, and not the other way around. In essence ube becomes a marketing engine for its partners.

Case in point: Once downloaded the ube app begins to scan the home network in order to recognize any devices that it can control, like a smart TV or a set-top box. But it can also make suggestions based on what it doesn’t detect. Let’s say it does not detect a smart thermostat. Here comes a push notification to the customer for 20% off an IP-enabled thermostat. It is a perfect example of being able to capitalize on missed opportunity. But that opportunity doesn’t end there.

Baldwin likes to cite that $14 billion number from CEDIA. Looking at the numbers he points to the fact the majority of installed systems fall under the realm of home entertainment—e.g., set-top boxes, smart TVs—and IP-enabled music systems. But absent from that count in large part are home-lighting systems—at least for the mass market, for which ube is aiming. In response, Baldwin and Burchers decided to create that portion of the market themselves.

Perhaps Baldwin simply cannot ignore his roots. Or perhaps he simply wants to put his money where his mouth is and prove to the industry that M2M can be made simple. Whatever the reasoning, it led to the launch of a ube line of lighting and electrical products. To quote Baldwin, such a line of products are intended to “demonstrate to the industry that (these systems) can be democratized.”

This line includes a smart dimmer, an electrical outlet, and a smart plug all of which can be installed by the average homeowner—no EE degree required. Each product includes a 32-bit ARM processor with Wi-Fi, running Android Ice Cream Sandwich OS. And perhaps most appealing: ube offers these products at a price point that is much lower than that of today’s intelligent lighting-control products.

In pure ube fashion, these lighting products communicate with each other without the need for any additional hardware. “The dimmer has capacitive multitouch, which means you can walk up and tap to turn it on and off, but if you slide a finger up and down you increase or decrease the intensity of the lighting,” says Baldwin. “But by using two fingers the dimmer can communicate with other dimmers in the room and begin to either raise or lower (the intensity of) others. And if I use a pinch motion like with a phone, it will turn off all the lights in the home. That is all done without any interaction with any other hardware, and your smartphone does not even need to be on.”

The fact that these devices are communicating directly with one another is of high value to many different stakeholders in the process. After all, if the goal is to expand the total available market, then the products need to be simple and not require effort to a homeowner who wants to add or change their system.

Baldwin describes the process being as easy as sending or receiving a text. He says, “If you were to install a new plug or dimmer the ube app would send you push notification letting you know it found a new device. You then answer two questions: What room is that dimmer/plug located in; and what would you like to call it (table lamp or light)? As soon as this is done, the app will dynamically update itself adding the controls for that light switch. Then you can immediately control it without the need for additional hardware.”

Now comes the value-add part for the homeowner. Remember those push notifications? Now once ube is controlling things like a dimmer, it can tell when a light bulb is out, for example. From there, the app proceeds to give the homeowner a headsup not only that a light is out, but also pushes out a coupon for 25% off light bulbs at a nearby hardware store. Or let’s say ube recognizes a drip pan is not flowing properly in your attic and the drip line needs to be flushed out; the app has the ability to notify your HVAC contractor or connect with a local contractor at a discount.

Beyond product discounts and local-merchant deals, what Baldwin and Burchers are hoping to deliver, ultimately, is the power of positivity around the idea of big data—something that in this age of privacy concerns doesn’t get it’s due.

“People with data feel empowered,” Burchers says. “At Freescale we had a device called Home Energy Manager that talked to your smart meter. It sat on your counter and glowed red, green, or yellow based on the amount of energy you used. We had customers tell us that when it was red, they would run around the house turning off lights in hopes of making it green or yellow.”

While that is a great first step, it is Baldwin’s opinion that this running around in the home described no longer needs to occur. “Why do we still fumble around for our keys or run around turning off lights in the house? Why do we still not know what the true operating cost of our dryer is? It makes no sense. If you get behind the wheel of a car today, at any price point, when it starts to rain your wipers turn on, your headlights turn on, and your all-wheel drive engages. And the driver is not even cognizant that these things are occurring. The auto industry has integrated systems for safety, convenience, and performance for decades. The time has come now for the home to follow suit.”

This essentially flies in the face of Baldwin’s large custom-home installation roots. Yet, he insists that is not the case. “I did not create this company to wipe out an industry; it is simply just the next logical step for (the) connectedhome industry.”

The ube platform is looking to lay such groundwork. It can not only tell you how much energy your AC is using, but how much energy a single light switch is consuming. “It can send a push notification telling you that your light switch is costing you $5 more a month than last month, asking if ube can help,” says Baldwin. “If you say yes, the next time you go to turn those lights on they won’t go to 100%, they will go to 90%, and that will make up that difference over the course of a few days.”

While that sounds all well and good, it is time to think bigger. Such lifestyle-altering ability can reach levels of nirvana as more and more devices get connected. Say you step on your Wi-Fi-enabled scale and it tells you that you’ve gained a pound this week. But why? Well, according to your connected pedometer you have taken 5,000 fewer steps this week and your connected TV is telling you that it was powered on for five additional hours this week than it was last week. By knowing all of this, ube—that “fabric” that stitches all the data from these devices together—now provides a gentle nudge to you that perhaps it’s time to go on a walk. Hey, it’s just a suggestion!

That, for all intents and purposes, becomes the million-dollar idea around connected devices. Good thing Baldwin and Burchers have that giant DEMO check to match.

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June/July 2014
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