This blog is an attempt to pull together an understanding of the transition taking place from the Traditional Lighting industry (the Past), to the Smart Lighting industry (the Present) to the Intelligent Lighting industry (the Future). Your comments are welcome….. firstname.lastname@example.org
As an unabashed sports nut (how about those Cubbies), let me ask, is there any business more traditional than baseball? Much like the lighting business, I might add. For over 100 years, both traditional businesses changed very reluctantly. Three traditional umpires confirmed who was in charge:
• I call ’em like I see ’em
• I call ’em like they are
• They ain’t nothin’ til I make the call!
Well, times they are a changin and the cause is technology. Now their final call can be challenged and reviewed in slow, very slow motion in NYC, of all places, far away from the actual game. Now the umpire’s not-so-final call is outsourced using video technology-based analytics. How did that happen? Well, technology gives this very traditional business the ability to get it right. That’s what happened. Took baseball a little longer to get there but there they are and they are not going back to the good ole days.
The traditional lighting industry has always wanted to get it right. Quality of light, energy efficiency and long life have been the focus over the past to get it right. We are an industry made up of independent companies, yet very interdependent. On the manufacturing side: luminaire, lamp, ballast, controls, accessories companies are interdependent; on the supply chain side: agents, specifiers, designers, contractors, distributors, utilities are all interdependent to bring the best lighting system to market. They have to work together…..we call that cooperative innovation. And it produced a bright industry (sorry about that) that experienced many sustainable innovations (a continuous replacement of old products to new better products) that improved the Edison’s incandescent light bulb over its history. That’s the Past…
I contend that we are now in the Smart Lighting business, the Present. Just like the changes taking place in baseball, lighting is in a transition to get it right and it is SSL technology that’s driving the bus. It’s still all about quality of light but for the first time since the Edison bulb, it’s disruptive innovation (a discontinuous market shift from the few to the many). Think about it: every single light source commercially available will be replaced with a SSL system and we are talking about a $300+ billion USA installed base. Not to worry, getting it right is hard and it will take time but the stars are aligned – SSL is here to stay. The Smart Lighting industry is now, the present, allowing us to manipulate the timing / intensity / tuning of light leading to tracking / reacting / adapting to the users’ living and working patterns. Lighting will always be concerned about quality of light but energy efficiency and long life is off the table. We have the latter with the new technologies. So let’s focus on quality of light and getting it right…
We are well on our way…last year (2015), 78% of all outdoor luminaires shipped were LED; and 50% of all indoor luminaires shipped were LED. Here are some other LED sales highlights just in the last 5 years from 2011 to 2015:
• LED units: from 6m to 290m
• LED dollars: from $140m to $1.6b
• Consumer: $62m to $1.0b
• C & I: $75m to $630m
• TLED units: from -0- to 17m
• TLED dollars: from -0- to $225m
LED Average Unit Price (AUP)
• “A” lamps: from $20.73 to $3.81
• PARs & Rs: from $33.33 to $8.40
• Decorative: from $19.17 to $7.12
• TLED: from $46.67 to $13.24
Cannot wait until we see how we are doing in 2016….
Now let’s look at the Future: the Intelligent Lighting industry…..IT CAN THINK! Lighting has the potential to be the core connector to every device you own. It’s just not about light anymore. It’s about IoT / IoE / PoE / VLC / Li-Fi / VoIP / SAE / LaaS and much much more…….and that’s just the tip of the iceberg. What’s under the surface of the water is mind boggling. The real game changer is Big Lighting vs. Big Networking. Or will it be cooperative innovation again? Time will tell but it is clear, we are on a pathway to connected information using light! WOW! IT companies see a real opportunity to reshape the lighting industry and they want a piece. Maybe even dominate…don’t look back, they may be gaining on you.
Simply put, our customers will want Intelligent Lighting when they understand the benefits and there will be many. Intelligent Lighting is about the ability to easily interface with other systems to deliver additional value; it is key to our success in an overall vibrant digital ecosystem. Connected lighting systems can interface with many other building verticals, all leading to things like intelligent productive workspaces, innovative applications and services, digital marketing platforms, human centric lighting, healthcare – circadian rhythm cycles, plug-and-play interactions, integrated security (installed cameras for facial recognition), home and office automation, intelligent networks – secure / reliable, and much much more.
One last point……let me talk about the WHOLE PRODUCT CONCEPT. My view is we are not just selling light anymore. We are all becoming lighting / data integrators: selling Innovations + Solutions + Services. It’s the best of times. What do you think……..and how about the supply chain: what does lighting distribution need to do to stay in the game?