Bosch chief executive, Volkmar Denner, is known for his policy of taking small steps. But the key is that they are all headed in one direction: interconnectivity.
Now, these small steps may soon culminate with a bigger one. Bosch is spinning off its involvement with smart homes into a new independent company, Robert Bosch Smart Home GmbH.
Through the new subsidiary, Bosch will deal directly with the end consumer for the first time. Its online shop opens on January 1, and the systems on offer enable control of heating, lighting and household appliances through a single app.
The chic white devices look like they could be from Apple, which isn’t an accident. The new company, headquartered in Gerlingen, near Stuttgart, is a counter-attack against Google moving into Bosch’s terrain: home technology.
Last year, the Internet giant took over Nest, a U.S.-based producer of intelligent thermostats, for $3 billion. Founded by former Apple executives, Nest brought smart devices with cool design to the market.
Unbeknownst to most of the public, Bosch has had this technology for some time.
“Setting up the Bosch smart-home subsidiary is an important strategic step toward pooling and expanding on our range of solutions for the smart home,” said Bosch’s Stefan Hartung, a management board member in charge of energy and building technology, in a statement.
The southern German company wants one thing above all else, and that is to operate on the market more quickly and more directly. Bosch has already spun-off three other companies for products such as the microsensors in smart phones and tablets, as well as its e-bike activities.
The latest subsidiary is set to launch just ahead of an important trade fair, the Consumer Electronics Show in Las Vegas in January, where Bosch plans to making a big impact. Among the products on display will be a new solution that allows smart windows and doors that not only report break-ins, but can also control heating when they are open. The company’s smart thermostat will also be provocatively positioned against the products from Nest.
According to market experts, about 230 million households worldwide will be outfitted with smart home technologies by 2020. That’s just under 15 percent of all households.
“Our solutions relieve users of tiresome routine tasks while offering them more convenience and safety,” Mr. Hartung said in the statement.
Bosch is attempting to score points with an open platform to which other devices can be connected. The centerpiece of it all is the Bosch Smart Home Controller, a unit that connects the components with the Internet and each other, but can be controlled with just one app.
As the world’s largest producer of household appliances, Bosch is particularly well positioned to network such products. For strategic reasons, the company also bought up the other half of BSH from its joint-venture partner, Siemens, last year. Since then, it has consistently designed new appliances to connect to the Internet. In the future, not only will heating and the lighting turn on when the homeowner’s smartphone approaches the house, but the coffee machine or oven too.
Whether Bosch can hold its own against Google’s enormous financial power remains to be seen. After all, the battle over smart home customers won’t be waged with only technology and services, where Bosch’s strength lies, but with clever brand strategy and management as well.