Smart Buildings: An Ideal Application for AI
The integration of Artificial Intelligence (AI) in smart buildings presents a significant opportunity to convert the vast amounts of data generated by the Internet of Things (IoT) into meaningful insights. These smart structures, equipped with numerous sensors, have become increasingly prevalent, driven by advancements in IoT technology. The sheer number of smart buildings today is impressive, highlighting a lucrative landscape for telecommunications companies.
Exploring the Growth of Smart Buildings
Estimates regarding the number of smart buildings vary, but it is clear that they are everywhere. This trend is particularly beneficial for telecommunications providers. A report from Juniper Research indicates that last year, China boasted around 31 million smart buildings, while the United States had approximately 16 million. Europe contributed an additional 18.9 million to this total. Parks Associates, which monitors technological adoption in multi-family residential units, reported that the number of smart units in the U.S. reached 34.4 million by the end of 2024 and is anticipated to grow to 35.4 million by the close of 2025. Elizabeth Parks, president and CMO at Parks Associates, remarked that the smart multi-dwelling unit (MDU) sector has swiftly evolved from a niche luxury to a more widespread phenomenon. While recent slowdowns in housing construction have affected the smart MDU market, existing buildings are expected to undergo retrofits, sustaining market growth.
The Importance of AI in Managing Building Data
Greg Turner, VP and Chief Solutions Engineering Officer at Honeywell, shared insights about the challenge of “dashboard fatigue” that clients face due to the overwhelming amount of information generated by smart buildings. Users often find themselves inundated with data but lacking actionable solutions. This is where AI comes into play. According to Turner, AI provides a means to transition from mere information gathering to actionable insights. Tom Rule, the head of Digital Buildings for Siemens Smart Infrastructure, echoed this sentiment, explaining that AI can analyze the extensive volumes of data produced by smart buildings in a manner that human operators cannot achieve alone. He emphasized that while smart buildings produce a wealth of data continuously, this data must be processed effectively in order to yield timely and useful insights.
The Role of Telecommunications Companies
So, how does this connect to telecommunications providers? As Turner noted, connectivity is essential for smart buildings and becomes even more critical for those that are autonomous. However, the cost of establishing such connectivity can be daunting for those attempting a do-it-yourself approach. He pointed out that significant expenses arise from the installation of wired connections—connecting a $30 temperature sensor can often incur installation costs of around $1,000. Telecommunications companies, particularly as they develop public and private 5G networks, have the potential to alleviate these costs, enabling greater agility in smart building implementations.
Value-Added Services and Opportunities for Telcos
Beyond merely providing connectivity, Parks highlighted that telecom companies have the opportunity to offer additional managed services for both commercial and residential properties. These services could include AI-driven energy management, capital planning, security measures, space management, predictive maintenance, and more for commercial buildings. For residential clients, possibilities extend to climate control, entertainment enhancements, and security features. Parks noted that there is significant potential for smart amenities across various building types, all reliant on robust in-building connectivity. Telcos are ideally positioned to enhance value beyond just data transmission, but this will necessitate the adoption of new technological platforms to deliver innovative services. The benefits may manifest in numerous aspects, such as enhanced safety and security, communication improvements, control of lighting and HVAC systems remotely, air quality notifications, energy efficiency, and more.
AI: The Potential Catalyst for Revenue Growth
Telecommunications providers have long been pursuing opportunities to add supplementary services, particularly in areas like home security and entertainment management. The question remains whether AI could serve as the pivotal element that unlocks a new revenue stream for the industry. The developments in this space will be closely monitored as the integration of AI continues to evolve.
