Last edited 30 Nov 2016

Smart lighting market to 2020

The global smart lighting market is dominated by several players and is likely to retain a significant degree of fragmentation in the coming years. Key players holding a significant share in the global smart lighting market include Acuity Brands Inc., Osram Licht AG, Lutron Electronics Co., Honeywell International, Zumtobel AG, Encelium Technologies Inc., Legrand S.A., Digital Lumens Inc., Royal Philips N.V., and Streetlight Vision.

The global smart lighting market is expected to rise to US$30.1 bn by the end of 2016 and then rise to US$56.6 bn by the end of 2020. This represents a robust 15.9% growth between 2014 and 2020.

Of the key applications of smart lighting, commercial and industrial lighting are the leading revenue generators. The commercial and industrial application segment is expected to rise to US$25.5 bn by the end of 2020, more than twice that of any other application of smart lighting.

By product type, compact fluorescent lamps (CFL) are likely to remain the dominant revenue generator. The compact fluorescent lamps segment is expected to almost triple in value over the 2014-2020 forecast period, with a value of US$21.3 bn expected by the end of 2020. LED lamps are likely to see rapid growth - almost threefold over the 2014-2020 forecast period, exhibiting a robust 17.2% CAGR.

Regionally, Europe is the leading contributor to the global market, followed closely by North America. Both these regional markets are expected to be valued at around US$20 bn by 2020, with Europe remaining the leading contributor with a valuation of US$20.8 bn. The Asia Pacific is the key emerging market and is expected to more than triple in value over the 2014-2020 forecast period at a strong CAGR of 17.9%.

One of the prime drivers of the global smart lighting market is consistent progress in wireless communication and sensor devices and technologies. Stable communication technology is crucial for smart lighting, as it needs to react to external stimuli and be remotely operable. The increasing precision of modern sensors refine its products.

Another key driver is the need for sustainable technologies to be incorporated in street lighting. The use of smart lighting in street lighting can help generate significant savings and several governments across the world are supporting initiatives for its adoption in coming years.

However, the high initial costs of smart lighting are a significant restraint on growth, particularly in terms of residential uses. While governments and large corporations can readily adopt smart lighting on a mass scale, many consumers can’t personally afford it. The increasing adoption of smart lighting in large-scale applications will help lower costs in the long term, but this is likely to remain a constraint on the overall market in the coming years.