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The smart buildings market size is forecast to increase by USD 64.84 billion at a CAGR of 10.61% between 2023 and 2028. The market's growth trajectory is shaped by various factors. Firstly, there's a mounting demand for building automation systems aimed at optimizing business outcomes. Secondly, there's an increasing emphasis on safety and security, driving the need for advanced systems in these domains. Lastly, the imperative to conserve energy is gaining prominence, propelling the adoption of energy-efficient solutions. These factors collectively underscore the evolving landscape of building management, where automation, safety, and sustainability are pivotal. As businesses prioritize efficiency, safety, and sustainability, the market for building automation systems continues to expand, catering to diverse industry needs and challenges. Our market report examines historical data from 2018-2022, besides analyzing the current and forecasted market scenario.
Furthermore, stringent government regulations on reducing energy consumption and the presence of many global companies are the major factors driving the market in the region. The increasing use of smart grid solutions in the US as part of the overhaul of the national electricity network is also driving the growth of the market in the region. Additionally, ABB Ltd. company offers smart buildings through building solutions such as well being, efficiency, cost transparency, sustainability, connectivity, etc. Also, Advantech Co. Ltd. company offers smart buildings such as Wzzard, WISE 6610, WISE DeviceOn, WP EnSaaS, and Helicon.
Market Forecast 2024-2028
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In the realm of smart buildings, the convergence of 5G technology and IoT-enabled devices drives a revolution in efficiency and sustainability, curbing greenhouse gas emissions. AI-enabled innovations coupled with Virtual Reality (VR) redefine home automation, fostering seamless working from home experiences. From waste management solutions to energy-efficient structures, smart buildings integrate intelligent glass, smart thermostats, and smart elevators, transforming urban landscapes into interconnected smart cities. Smart lighting systems, intelligent security systems, and advanced network systems ensure robust safety, surveillance, and energy conservation in commercial buildings and Smart Homes.
The BMS segment will account for a major share of the market's growth during the forecast period.? The market is dominated by the Building Management Systems (BMS) segment, also known as Building Automation Systems (BAS). These systems, which integrate software, servers, sensors, and major components like HVAC, lighting, and emergency control systems, are essential for seamless control of all building systems. The cost of implementing BMS ranges from USD2.50 to USD7 per square foot. In the context of advanced technologies, 5G technology is poised to revolutionize smart buildings by enabling faster data transfer and real-time analysis. IoT-enabled devices, AI-enabled innovations, and Virtual Reality (VR) are transforming home automation and working from home experiences.
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The BMS segment was valued at USD 26.73 billion in 2018. Cloud computing, data analytics, and AI are key components of energy-efficient structures in commercial buildings. Greenhouse gas emissions are reduced through intelligent glass, smart thermostats, and smart elevators. Smart cities leverage resource management, urban environments, and automated technologies to create secure and sustainable living spaces. Building owners prioritize space utilization, environmental effects, and security concerns. Energy management, network management, and workforce management are critical aspects of smart buildings. Waste management solutions are integrated into both residential and industrial buildings to minimize environmental impact. Urban areas benefit through resource management, secure environments, and automated technologies. Sensors, actuators, microchips, and blockchain technology are essential components of these advanced structures. Thus, the above-mentioned factors will boost the growth of the segment of the market during the forecast period.
Software plays an important role in smart buildings through integrated building management systems. In such management systems, the software helps in collecting all the information generated by different subsystems, processors, storage devices, cameras, and sensors. The information collected is then processed and used to analyze and arrive at the best course of action, which is then circulated to the appropriate sub-system or device for further corrective or preventive action. Increasing commercialization in growing economies has led to growth in new buildings, and rising energy consumption has created an urge to save energy. Governments worldwide are largely focusing on converting new construction to balance the trade-off. Therefore, the software market is predicted to show high growth during the forecast period.
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APAC is estimated to contribute 31% to the growth by 2028. Technavio's analysts have provided extensive insight into market forecasting, detailing the regional trends and drivers influencing the market's trajectory throughout the forecast period. Another region offering significant growth opportunities to vendors in North America. The market in North America is expected to lead globally due to the significant growth in the US and Canada. The region's industrial and commercial expansion in countries like Brazil, Colombia, and Mexico will also boost the deployment of smart solutions. In the US, the residential sector will witness rapid growth, driven by advanced features in appliances such as washing machines, air conditioners, and refrigerators for enhanced comfort and energy efficiency. Key components of the market include information security, smart lighting systems, and energy conservation. Smart Homes integrate Intelligent Security Systems, Fire Safety, Video Surveillance, Access Controls, Theft Detection, and Intrusion Detection. Network Systems ensure seamless communication between various components, while Heating, Ventilation, Air Conditioning (HVAC), and Internet-of-Things (IoT) technologies optimize energy usage and improve overall efficiency. Thus, the above-mentioned factors will boost the growth of the regional market during the forecast period.
The market is experiencing significant growth due to the integration of advanced technologies such as 5G, Internet of Things (IoT) enabled devices, Artificial Intelligence (AI), and Virtual Reality (VR). These technologies are transforming commercial buildings into intelligent structures that prioritize energy efficiency and sustainability. They incorporate cloud computing, data analytics, home automation, and working from home solutions to optimize energy consumption and reduce greenhouse gas emissions. Intelligent glass, smart thermostats, and smart elevators are some of the AI-enabled innovations that enhance the functionality and comfort of commercial buildings. Moreover, energy-efficient structures, smart cities, and smart lighting systems are essential components of the market. These solutions promote energy conservation and contribute to the reduction of carbon footprints. The integration of intelligent security systems, automation, fire safety, video surveillance, access controls, theft detection, and intrusion detection further enhances the safety and security of smart buildings. Network systems play a crucial role in enabling seamless communication between various smart building components, ensuring optimal performance and reliability. Overall, the market is poised for exponential growth as businesses and organizations prioritize sustainability, energy efficiency, and advanced technology integration in their operations. Our researchers studied the market research and growth data for years, with 2023 as the base year and 2023 as the estimated year, and presented the key drivers, trends, and challenges for the market.
In today's business landscape, the adoption of building automation, also known as Smart Buildings, is a significant trend. They utilize advanced technologies such as 5G, IoT enabled devices, AI, and VR to optimize energy usage, enhance resource management, and ensure a secure environment. These intelligent structures employ cloud computing and data analytics to monitor and control home automation and commercial building systems, including HVAC, lighting, elevators, and intelligent glass. The residential and commercial segments of the market are increasingly adopting these technologies to reduce greenhouse gas emissions, improve space utilization, and manage waste in urban environments.
Furthermore, energy management is a critical aspect of Smart Buildings, with AI-enabled innovations and sensors monitoring energy usage in real-time and generating alerts when necessary. Network management, workforce management, and security concerns are also addressed through automated technologies and microchips. Building owners benefit from these solutions by reducing energy costs, improving environmental effects, and ensuring a secure and productive workspace. The integration of blockchain technology further enhances the security and efficiency of Smart Buildings. Therefore, the growing need for enhanced safety and security systems will drive market growth during the forecast period.
The market is experiencing significant growth due to the integration of IoT enabled devices, 5G technology, and AI enabled innovations. In contrast to non-automated buildings, smart buildings utilize IP-based reliable Internet connections to enhance connectivity and enable end-users to monitor multiple systems through a central hub. This demand is driven by the rising adoption of IoT, particularly in urban environments, where Internet penetration is high among commercial and residential segments. Smart buildings incorporate advanced technologies such as Virtual Reality (VR), Cloud computing, and Data analytics to optimize space utilization, energy management, and network management. Home automation, working from home, and waste management solutions are becoming increasingly popular in residential buildings.
Furthermore, commercial buildings benefit from intelligent glass, smart thermostats, and smart elevators, while energy-efficient structures and waste management solutions contribute to reducing greenhouse gas emissions. The integration of AI, sensors, actuators, microchips, and blockchain technology enhances resource management, environmental effects, security concerns, and workforce management in both residential and industrial buildings. Smart cities are also adopting these automated technologies to create secure environments and improve urban areas' overall efficiency. Thus, the increasing adoption of BIoT will boost the growth of the market during the forecast period.
The implementation of building automation software is much more complex than traditional systems, such as lighting, safety, and security in a building. As the amount and complexity of infrastructure increase, the integration of software that performs different functions poses a challenge. Any gap in this integration exposes the software to various physical as well as cyber threats. Further, in a smart building, building automation software provides an interface for all the hardware, and any attempts to hack into one system in the network can compromise other systems, which could lead to the entire network crashing.
Besides, a networked system also involves risks associated with unauthorized access to sensitive data, which can compromise the integrity and privacy of the entire building network. The exploitation of any loophole in the network can have a serious impact on the data center of the interlinked system. As the data center processes and stores a high volume of complex information, the potential risk of cyber-attacks can result in a meltdown of the entire building network, leading to a lag in building operations. Thus, the growing adoption of building automation software increases the risk of security breaches, which may hinder market growth during the forecast period.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
We also have detailed analyses of the market’s competitive landscape and offer information on 20 market companies, including:
Cisco Systems Inc., Delta Electronics Inc., Emerson Electric Co., Honeywell International Inc., International Business Machines Corp., Johnson Controls, L and T Technology Services Ltd., Legrand SA, Panasonic Holdings Corp., Robert Bosch GmbH, RTX Corp., Schneider Electric SE, Siemens AG, Smarteh d.o.o., Snap One LLC, Softdel System Pte. Ltd., Switch Automation, and Verdigris Technologies Inc.
Technavio market forecast the an in-depth analysis of the market and its players through combined qualitative and quantitative data. The analysis classifies companies into categories based on their business approaches, including pure-play, category-focused, industry-focused, and diversified. Companies are specially categorized into dominant, leading, strong, tentative, and weak, based on their quantitative data analysis.
The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2024 to 2028, as well as historical data from 2018 to 2022 for the following segments
Building Automation and Control Systems Market - Building Automation and Control Systems Market Analysis Europe, North America, APAC, Middle East and Africa, South America - US, UK, China, Germany, Canada - Size and Forecast
Smart City Market - Smart City Market Analysis Europe, North America, APAC, South America, Middle East and Africa - US, UK, Germany, Spain, Japan - Size and Forecast
Building Automation Software Market - Building Automation Software Market Analysis APAC, Europe, North America, South America, Middle East and Africa - US, China, India, Germany, UK - Size and Forecast
In the modern world, the concept of Smart Buildings has gained significant traction in the market. These buildings, equipped with advanced technologies and IoT devices, offer enhanced comfort, energy efficiency, and improved safety and security. The Green Technology sector plays a crucial role in the development of Smart Buildings, with components such as Cloud Computing, Compressors, and Energy-efficient Devices being essential. Artificial Intelligence and Virtual Reality are also integral to Smart Buildings, providing real-time analytics and enabling remote control and monitoring. The Commerical Real Estate industry is a significant consumer of Smart Buildings, with Intelligent Sensors and Control Systems being key features. The Bulding Industry is innovating with solutions like Smart Homes, Smart Offices, and Smart Cities, offering urban dwellers a more connected and convenient lifestyle. The future of Smart Buildings lies in their ability to adapt and evolve, offering new functionalities and services to meet the changing needs of occupants.
Market Scope |
|
Report Coverage |
Details |
Page number |
187 |
Base year |
2023 |
Historic period |
2018-2022 |
Forecast period |
2024-2028 |
Growth momentum & CAGR |
Accelerate at a CAGR of 10.61% |
Market Growth 2024-2028 |
USD 64.84 billion |
Market structure |
Fragmented |
YoY growth 2023-2024(%) |
9.32 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
APAC at 31% |
Key countries |
US, China, Japan, France, and UK |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
ABB Ltd., Advantech Co. Ltd., BuildingLogiX, Cisco Systems Inc., Delta Electronics Inc., Emerson Electric Co., Honeywell International Inc., International Business Machines Corp., Johnson Controls, L and T Technology Services Ltd., Legrand SA, Panasonic Holdings Corp., Robert Bosch GmbH, RTX Corp., Schneider Electric SE, Siemens AG, Smarteh d.o.o., Snap One LLC, Softdel System Pte. Ltd., Switch Automation, and Verdigris Technologies Inc. |
Market dynamics |
Parent market analysis, Market Forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the market forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements. Get in touch
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Product
7 Market Segmentation by Component
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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