The Value of Connected Properties for Residents

The connected consumer markets that make up the consumer IoT are progressing in most developed nations. This is driven, in part, by widespread access to technologies such as broadband, Wi-Fi networks, cloud services, and smartphones. In recent years, connected devices across various categories including entertainment, smart home, health, and wellness have experienced real technical and market development. This development has led to a growing expectation for technology in daily lives.

Security and safety constitute the core value proposition of the smart home, followed closely by energy and cost savings. Among smart home device feature sets, MDU residents generally find those relating to access control most valuable, followed by smart thermostats and smart lighting.

Access control – MDU residents who intend to purchase a door lock find security features that prevent it from hacking most important. Features that prevent break-ins and detect intruders are next, followed by those that monitor activities outside the premises and those that provide convenience for access, including “hands free” access. Smart door locks typically provided to MDU renters are those that allow residents to grant access to guests remotely and receive notifications when maintenance enters their unit.

Smart Thermostats – Thermostat capabilities that help save money are most important to consumers who intend to purchase a smart thermostat. Safety use cases, such as adjusting thermostats to prevent the growth of mold and viruses, and convenience use cases, like sensing humidity and temperature controls, rank highest in importance within the category.

MDU renters value energy-saving features via smart thermostats higher than do MDU owners and all broadband households, so smart home device manufacturers and solutions providers targeting MDUs must promote the energy-saving capabilities for both property owners and residents to score broad-scale deployment within properties.

• 36% of MDU renters are interested in a remote climate control service using a smart thermostat, and more than 70% of those interested are willing to pay more money in rent per month for this feature.

?Smart Lighting – MDU households generally find automated lighting features that help save energy most valuable. Approximately 50% of MDU households who intend to buy smart lighting find bulbs that sense how much energy is used and that minimize energy costs as valuable. Use cases related to safety and security follow energy savings. MDU residents perceive smart lighting features that enhance ambience and mood least important. Forty-four percent of consumers find a feature that senses light in the room and adjusts the light from the bulb to provide optional lighting valuable; 38% find smart lights that work with apps that allow residents to change bulb colors for cool effects important. The smart lighting feature typically provided to MDU renters is the ability to control lights remotely. This feature is not typically automated but can help consumers to save energy.

Coming out of COVID-19, MDU residents also show interest in apartment amenities that promote a healthy living environment and provide space for remote work. All of these new amenities benefit from robust, integrated connectivity; relatedly, 30% of MDU renters are willing to pay to access bulk internet services bundled in with their rent. High levels of interest in smart home-related products and services, and willingness to pay for these solutions among MDU renters, mean the opportunity for new revenue among property owners in the US alone is easily more than $1 billion annually.

• 35% of MDU renters report they are willing to pay higher rent for air purification.
• One-quarter report they are willing to pay for touchless lighting controls and building access.
• 20% report they are willing to pay higher rents for common office areas.

Opportunity for Service Providers to be Trusted Advisors for Smart Communities

Residents need reliable, high-speed broadband internet and seek to upgrade their service to meet their needs. In September 2020, 12% of MDU residents reported upgrading their home’s broadband service in the prior 12 months, with an additional 12% initiating a new broadband subscription—either as a first-time subscriber or re-subscribing after going without for some time.

• 31% of MDU residents with broadband access, or about 10 million households, report they are likely to upgrade their home internet service to a higher speed in the next six months compared with just 21% of residents of other housing types.

MDU residents also report higher intentions to upgrade broadband services than consumers in single-family homes or other resident types. MDU residents are particularly interested in gigabit speed service, with the majority of all MDU residents indicating a likelihood to subscribe if made available to them. Broadband providers have an opportunity to address underperforming connectivity for MDU residents and upgrade subscriptions to the highest tiers available.

Beyond connectivity, ISPs also have an opportunity to be a partner to MDU residents and property managers in supporting the connected living experience. Consumers report that the loss of wireless connectivity is their leading problem when using smart home devices. Wi-Fi will continue to be a growing problem for consumers as more and more devices are used on the network and as use of video services also increases. Some residents may have older routers that do not have the security capabilities to meet current standards/requirements. This creates exposure to security threats. Residents also have concerns about solution providers and property managers having greater control over the data generated by their smart devices.

Smart home devices are relatively new to consumers when compared with other more traditional connected devices such as computers, tablets, and smartphones. When they do experience problems, lack of experience with these devices makes it more likely that consumers will require professional support. While platform providers, at a minimum, all provide some level of onboarding and training to property managers, these managers are not likely equipped to handle all the issues their residents may encounter when setting up and learning to use their smart home devices. The continued growth of connected devices and subsequent network complexity has created a new role for service providers as trusted advisors to both segments—MDU building owners/managers and MDU residents.

Broadband service providers have an opportunity to increase revenue by creating unique offerings of robust networking technology and additional services. This fulfills a valuable niche as a solutions provider for whole communities of users. This creates better value for the consumer and can give property developers and managers a competitive advantage. Along with providing smart home solutions for MDUs, technical support is a key offering. The level of support provided for installation, service onboarding, and ongoing technical support for products varies among providers and is a source of competitive differentiation. This helps the MDU property manager, who may not have the time or expertise to manage these issues. ?The ISP can be the partner to provide residents and property staff with the support they need to make connected MDU living work.

This research is an excerpt from the whitepaper, Future-ready Broadband: Ubiquitous Connectivity for MDUs, addresses the growing demand for exceptional connectivity in MDUs. It evaluates the benefits of next-generation connectivity services for MDU property managers and residents, as well as the role of the service provider as a key partner in smart MDU living. The research was produced in partnership with Cox Communications. Download the full report: https://www.parksassociates.com/whitepapers/mdu-wp2021

? Parks Associates