4 Reasons Cisco Won't Dominate the Smart Grid With Its Slick Home-Energy Gadget

Cisco (CSCO) has squeezed itself into the overloaded home-energy management market with a slick new gadget that allows customers to see how much power they're using in real time. Unfortunately, Cisco picked the wrong centerpiece for its campaign to carve out a profitable new business in the smart-grid industry. Instead, it should've skipped the consumer stuff and stuck with the piece of its smart grid plans that works: commercial and industry customers.

Cisco's device, called the Home Energy Controller, does just what the name implies. The counter-top device (pictured here) uses Cisco's energy management software and has a touchscreen that allows homeowners to view and manage their energy consumption as it happens. The device comes with nifty features like real-time pricing, which lets customers watch in horror (or with glee) their electricity bill. The gadget is Zigbee and Wi-Fi wireless enabled, which means it can communicate with appliances that are plugged into smart plugs, smart thermostats and your utility.

On pure looks alone -- think of an iPad with a stand -- Cisco has created one pretty little gadget. But in the emerging and yet defined smart grid industry, a good-looking and easy-to-use device only gets you so far. Here are four reasons the Cisco gadget won't take the smart grid by storm:

1. Most Americans, excluding some of the tech savvier markets like the San Francisco Bay area, don't know or understand what the smart grid is.
2. There are loads of other start-ups and big, established companies developing either the in-home devices, the energy management software or both. General Electric (GE), Tendril, EnergyHub and Silver Spring Networks are just a few.
3. Cisco's Home energy controller and its service will be bundled and sold to utilities for $900 per household. The utility isn't going to eat that, which means the cost would be passed on to the homeowner. That's a lot of cash, especially considering both Google PowerMeter and Microsoft's Hohm have already released free Web-based software designed to help customers monitor energy use.
4. Consumers are now faced with the fourth-screen dilemma. You've got your TV, laptop and smart phone. Now Apple's iPad is here, along with the tablet copycats that will follow. The iPad is actually the perfect home-energy monitoring platform, an idea that Earth2tech also noted back in April. Why buy into the Cisco system, or anyone else's for that matter, if you can download a home-energy app to your iPad ? And yes, at least one free app, created by Control4, already exists.

The good news for Cisco
A far-more promising market for Cisco is on the commercial side. The company also has developed the Cisco Network Building Mediator Manager 6300, a centralized system that allow corporations to connect, monitor and manager energy usage throughout all of its operations.

Here's how it works. The first step is the Cisco Network Building Mediator, this is an energy monitoring system at the single building level. So, a corporation with 100 buildings scattered throughout the world, would be equipped with the building mediator, which interconnects four systems: the building, IT, energy supply and energy demand. From there, the "network building" manager will link all of these "smart" buildings across operations.

Building management isn't new. Johnson Controls and Siemens are already in the space. But Cisco says it's the first to platform that enable energy reduction and efficiencies across a corporation's global operations. And it already has relationships with corporations, which should make the sale of these services much easier than in the residential market.

Photo of Cisco Home Energy Controller from Cisco
Related:

• Microsoft versus Google: How Ford's Electric Car Pushed Hohm Ahead PowerMeter
• Energy Side-Effect: Google PowerMeter Makes Smart Meters Irrelevant
• Microsoft's Hohm Enters Crowded Home-Energy Monitoring Market