Consumers Willing to Pay for Energy, Smart Home Services With Clear Value, Says Parks

More than half of U.S. broadband households would be willing to pay $5 per month for a smart thermostat service that includes setup, installation and repair/upgrades, said a Tuesday Parks Associates report. The firm tested multiple hardware-as-a-service scenarios and found that despite consumers’ general aversion to monthly fees, they’re willing to pay for services with “clear value that include tasks they cannot or do not want to perform on their own.” Many smart home industry players want to shift business models from products to services, said Parks analyst Tom Kerber, who said providers need to frame services correctly for the transition to succeed. Households with a smart thermostat paid on average $177 for the device, "so a service model at the right monthly price would be very attractive to consumers,” Kerber said, saying those customers value features such as repairs, preventive maintenance and tech support when considering such services. Survey respondents said they’re interested in hardware-as-a-service options for smart home kits, HVAC systems and solar panels, when presented with a lower price point. Kerber suggested energy and service providers could use the data from services to build additional services, such as real-time energy management. "Identifying when an appliance is operating less efficiently is also a big opportunity,” he said.