By 2028, the smart lighting market will reach US$46.9 billion
By 2028, the global smart lighting market is expected to reach 46.9 billion U.S. dollars, with a compound annual growth rate of 20.4% from 2021 to 2028. The market growth is attributed to the rising trend of smart cities, smart homes, smart street lighting systems, and the demand for energy-saving lighting systems. Although smart lights are more expensive than ordinary lights, their advantages outweigh the overall installation cost. However, due to the decline in purchasing power of middle-class income groups during the COVID-19 pandemic, the high price of smart lights has limited market growth.
The global smart lighting market will be worth 10.85 billion U.S. dollars in 2020, and it is expected to expand at a compound annual growth rate (CAGR) of 20.4% from 2021 to 2028. Ambient lighting using only smartphones or tablets has increased its popularity and demand in commercial and residential spaces. Smart lights can be dimmed in various tones as needed, can be arranged to turn on/off, monitor the energy usage of the lighting, and connect via Wi-Fi, Bluetooth, Smart Things, Z-Wave or ZigBee.
In addition, smart lights can be voice-controlled through integration with platforms, such as Google Assistant, Amazon's Alexa, Apple's Siri or Microsoft's Cortana. In addition to lighting, these extensive functions, coupled with the increasing popularity of IoT devices and smart assistant platforms, have created a market growth path for smart lighting.
Smart lighting is also called connected lighting because it can be seamlessly integrated into IT networks in buildings or urban infrastructure to share information about operating status. For example, smart street lights in urban parking lots or roads provide extensive coverage, environmental monitoring, parking and traffic management information, and city monitoring by connecting IoT devices to ensure safety. Smart lights are usually integrated with sensors, turning them into a smart device point to collect information about activity patterns, daylight levels, occupancy rates, temperature changes, or humidity. Facts have proved that this information is essential for government agencies to take appropriate actions and monitor the city for unnecessary activities.
The government's policies to encourage energy conservation and environmental protection and strict regulations discourage the use of incandescent lamps are expected to boost the demand for LED smart lighting. The global lighting industry consumes approximately 19% of total electricity and generates approximately 6% of greenhouse gas emissions. On the contrary, LED smart lights are very efficient. They consume almost 70% of energy and connect devices to collect information for use in future processes. They have a significantly longer service life and do not contain any mercury content. Similarly, LED lights will not emit harmful greenhouse gases. Therefore, LED technology has the potential to completely change the entire lighting industry and penetrate into the field of smart lighting, where LEDs are the first choice of suppliers and consumers.
In addition, the penetration rate of smart lights is expected to increase as its advantages include controlled power usage, longer lifespan, multiple lighting settings in a single lamp/lamp, and the availability of a wide range of modern decorative lighting products. The use of smart lighting in residential, commercial and industrial sectors has not yet reached its full potential. Therefore, various government initiatives to promote the use of LED-based smart lights are expected to increase their demand during the forecast period.
For example, in January 2019, the New York Power Authority allocated US$7.5 million to municipalities across the state to install new smart LED street lights. In addition, China, Brazil, Colombia, Mexico, France, Spain, Germany and other countries have completely banned the sale of incandescent lamps and encouraged the use of LED lamps; among them, high-income groups tend to use LED-based smart lamps.
In addition, many smart lighting companies have reported that the COVID-19 pandemic has had a negative impact due to lockdowns, destruction of construction activities and raw material supplies. The decline in consumer purchasing power and the delay in completion of construction projects due to the COVID-19 pandemic have driven the number of smart light purchase orders, timetables and payments.