Indoor positioning projects in retail are now popping up around the globe.
Indoor positioning is the next revolution that is set to reshape the world of retail. Be it Osram, Philips, GE or Zumtobel all the major players in the lighting world are developing their own interior navigation systems, that utilise bluetooth chips planted in lights or visible light communication (VLC) to send directional information to shoppers smart phones. The apps can then direct shoppers to special offers or products that particularly interest the shopper in question.
New indoor positioning projects in retail are now popping up around the globe and the initial results from these are often quite impressive. Here are Lux’s top ten indoor positioning projects that you need to know about.
10) Ginza Six Mall – Tokyo
Ginza Six is a massive 500,000-square-foot retail complex in Tokyo that is set to open in the next few weeks. Quite understandably some kind of guidance is going to be required to get shoppers around such a massive space and the owners have turned to indoor positioning to help.
StepInside, an indoor positioning system developed by Senion is being installed, which will show patrons the quickest route to a store via a smartphone app.
The mall is expecting up to 20 million people to visit the store every year, many of whom will be tourists unfamiliar with the sites layout.
The building’s management will use the data collected by the app to better understand the behaviour of visitors, helping authorities to develop better traffic flow management systems when the store opens.
9) CapitaLand Mall – Singapore
The CapitalLand Mall in Singapore is installing a Philips VLC based indoor positioning system.
Users are required to install an app on their smartphone and then allow the camera on their phone to pick up a light frequency emanating from the Philips lights installed around the mall.
The shopper’s location in the mall is then identified and directions are given, depending on where abouts in the estate the shopper wants to go. Retailers are also able to use the app to send out targeted marketing messages to shoppers.
8)E.Leclerc – Langon
Zumtobel joined forces with E.Leclerc Langon, a hypermarket in France, to launch an indoor positioning, smart parking and mobile push marketing app.
The existing lighting infrastructure has been adapted to offer the serrvices, by fitting the luminaries with sensors.
The Bluetooth beacons allows customer to locate their position and allows E.Leclerc Langon to send real-time push messages with customised offers, based on the customers current location in the store.
In the car park, the app can help a customer to locate available parking spots, or even find their way back to their car when they have finished shopping.
7) Tai Po Mega Mall – Hong Kong
Google has invested in several indoor location companies and the firm believes that that in time indoor positioning will be bigger than GPS, simply because people spend the great majority of their time indoors.
Google has created indoor maps of stores like the Tai Po Mega Mall in Hong Kong and other major worldwide retail destinations in preparation for the launch of the company’s head-mounted computer ‘Glass’ which will allow people to see directional arrows through glasses.
Although it is still early days, there is the potential for Bluetooth chips embedded in light fittings to be able to provide information to feed Google Glass in the future.
The €84 billion ($93.4 billion) retailer transmits digital information from LED lamps to customers’ smartphones via VLC provided by Philips. The system uses 800 programmable Philips LEDs.
VLC is able to encodes lightwaves with data about products and promotions, and transmits the information straight to the camera on a shoppers’ smartphone.
An app then displays the directional information, which helps to guide the consumer to the product’s location in the sprawling store.
5) Walmart – US-wide
Walmart is thought to be trialling Acuity Brands indoor positioning technology.
Acuity Brands claims that it has now deployed lighting-based indoor positioning systems (IPS) in swathes of retail space across the US.
Acuity Brands is thought to be developing indoor positioning products in conjunction with Microsoft.
The two companies are developing products that utilise lighting to communicating information to to shoppers smartphones.
Data the app collects is then sent to Microsoft’s Azure cloud system to allowing retailers to discern useful retail patterns and insights.
4) Aswaaq – Dubai
UAE supermarket chain Aswaaq became the first retailer in the Middle East to install connected lighting which communicates with its customers.
Its Dubai branch boasts a VLC based indoor positioning system, which allows shoppers to find items in the store to an accuracy of 30cm.
Smart-phone owners must first download the Aswaaq-branded app, which allows their phone to communicate with the individual light points transmitting their location through the high-frequency modulation of the light.
The data stream is one-way and no personal data is collected by the lighting system.
3) Target – US wide
American retail giant Target uses LED ceiling lights to track in-shop customers and guide them to relevant products via their smartphones.
The system is widespread and has been placed in nearly 100 Target stores.
The $73 billion chain told Lux that the scheme uses wireless signals that travel between LED lights and shoppers’ Android gadgets to spread directions and information related to products and special offers.
The 100 location deployment marks the largest known deployment of indoor positioning by any retailer to date and offers a good sign that the system can work and be worthwhile on a wide scale.
In collaboration with Favendo, Philips has developed a new smartphone app that gives shoppers access to location-based services, helping them to find items in the store, down to an accuracy of 30cm.
A range of newly introduced downlights and spotlights have been installed in the store, which are compatible with the Philips way-finding technology.
As well as providing location services and in-pocket notifications about discounts, the technology can also be used to collect data about where are the busiest areas in stores and analyse the routes customers take to find products. This allows retailers to make better decisions when it comes to store layout and marketing.
The Philips Lighting Bluetooth low energy (BLE) beacons, which allow the location system to work, are easy to integrate as they come with multiple powering options ranging from full integration into luminaires to track-mounted beacons.
1) Marc O’Polo – Switzerland-wide
The indoor positioning system installed as part of a trial in Marc O’Polo stores in Switzerland saw the average value of purchases made by customers rise by 10 per cent, the best evidence to date that indoor positioning could well revolutionise retail.
Osram Einstone technology was commissioned by the Bollag-Guggenheim Fashion Group to try and improve customer loyalty, whilst increasing the chances that customers would purchase products. The company wanted to develop a mobile phone app that would serve as a digital customer loyalty card, which would offer discounts and special offers locally using indoor positioning technology powered by the lights.
Shuji Nakamura is talking up the future Li-Fi. Photo by Russell Abraham for Soraa
Laser lighting is currently being used in cars, but the technology is not cheap, something that is set to hold back the product’s commercialisation.
Shuji Nakamura, the man who won the Nobel Prize for inventing the blue LED, has named Li-Fi as crucial to the future of lighting technology.
Speaking at Academia Sinica, in Taipei, Dr. Nakamura stated that LED has now reached a ‘stage of maturity’ and manufacturers are seeking out new markets where they can thrive into the future.
Nakamura named Li-Fi and laser lighting as two crucial areas the LED industry needs to concentrate on in order to further their businesses successfully.
The Nobel Laureate also stated in his lecture that there has been areas in which the advancement of LED has surpassed even his expectations.
For example, researchers in Taipei have recently begun using LEDs to separate malignant cancer cells from normal cells.
Most recently, Nakamura has been dedicating his time to developing laser lighting, which he hopes, will one day replace LED.
Laser lighting has already been used successfully in car development. Automotive headlights that feature laser lighting are able to project light as far as 600 metres, which is much longer than the 300 metres managed by LED.
Nakamura predicted that should Li-Fi and laser lighting combine, then the Li-Fi technology would be able to transfer data at speeds up to one hundred times faster than Wi-Fi can currently manage.
However, laser lighting does not currently have the same efficiency benefits as LED and is, in comparison with LED, quite expensive, costing up to ten times more than its sister technology.
Nakamura is currently teaching at the University of California in Santa Barbara, with his two fellow researchers, Isamu Akasaki and Hiroshi Amano, who together received the Nobel Prize in Physics in 2014 for ‘developing the manufacturing technology of the blue LED and fostering the emergence of bright, power-saving white LED.’
You can watch Lux’s interview with Shuji Nakamura here:
As Philips announces they are investing in Li-Fi, this week we explore a new technology that has the ability to change the world. What is Li-Fi and how will revolutionise the way we receive the internet into our homes? Lux Today 21 February 2017
The smart city revolution shows no signs of slowing down, and the opportunities for the lighting industry are ripe for the taking. In the run up to Lux’s Lighting Fixture Design Conference, which will run from the 21 to the 22nd of February in Central London, they reveal their top five smart cites, where lighting is allowing city authorities to reimagine how our population centres are managed.
5) Los Angeles
Los Angeles is currently seeing through a plan to replace every old sodium-vapour streetlight with smart LED fixtures. The city is now 80 percent of the way through the project, which has seen the conversion of nearly 200,000 street lights. The project has saved the city over nine million dollars and has acted to reduce crime.
The existing streetlight poles are being replaced with ‘smartpoles’, which are fitted with 4G LTE wireless technology and act to improve phone reception in the tightly packed city. The smart street lights are also capable of alerting city authorities when a fixture breaks down and is need of repair and some are also able to monitor and compile analytics on traffic levels and the availability of parking places.
As we reported last year some Los Angeles street lights are able to use sensors to listen out for car crashes, reporting them to the emergency services when they occur.
4) Singapore
Singapore is aiming to become the world’s first ‘smart nation’. Sensors and cameras are being installed to track absolutely everything from traffic to the capacity of wastepaper bins.
In Singapore lighting plays a role in the city’s incredibly smart transport network, which utilises road sensors, smart traffic lights and smart parking.
Late last year Philips Lighting announced a partnership with the Sentosa Development Corporation to develop a connected streetlight management system on Singapore’s island resort of Sentosa.
It was also recently announced that visible light communication (VLC) is being installed in the massive CapitaLand Mall to create an indoor positioning system that allows shoppers to find their favourite stores amid the mall’s labyrinth of aisles and corridors.
The authorities in Singapore have also joined forces with Scottish Li-Fi firm pureLifi, in an attempt to bring the revolutionary technology to the South-Asian city-state.
3) Copenhagen
Copenhagen is already one of the world’s most sustainable and smart cities and it aims to become carbon neutral by the year 2025. Nearly half of the city’s street lights were replaced recently with LED. A number of these new fixtures form the backbone of a growing smart lighting network.
The LED streetlights brighten when vehicles approach and then dim after they pass, ensuring that roads are not continuously illuminated when it is not necessary. This is a safer option than turning off streetlights altogether in order to save money, which has been the case in the UK.
The sensor-laden light fixtures are also able to capture data and analytics and are able to help coordinate the city’s services. For example, fixtures can alert city authorities that waste bins need to be emptied.
2) San Francisco
San Francisco was arguably one of the first smart cities in the world and given its location, near Silicon Valley, this should hardly be surprising.
The city has more LEED-certified buildings than any other in the United States and a connected city initiative enables residents to locate parking places.
It was recently announced that 18,500 of San Francisco’s light-pressure sodium street light fixtures would be replaced with smart LEDs.
The new LEDs will be run via wireless smart controllers that will allow the city to remotely monitor individual light performance and adjust the intensity of the lights as required. For example, if there was a road traffic incident, the lights could be turned up.
The lights will also warn city authorities when fixtures fail or burn out, making lives better for residents, whilst saving the city money.
San Francisco’s new street lights will be powered with 100 percent clean energy, which, along with the wireless controls, will make them the greenest street lights in California.
1) Barcelona
Barcelona is renowned the world over for its smart city prowess. Boxes fitted to lampposts host finely tuned computer systems, which are able to measure traffic levels, road pollution, crowds and even the number of photographs on a particular street posted on Instagram.
Sensors fitted to streetlights and in the ground are also used to monitor the weather in Barcelona.
A few years ago the city suffered a very severe drought and came very close to running out of water altogether. As a result, smart sensors measure rainfall and analyse irrigation levels in the ground. This information is then used to modify the city’s sprinkler system to save water.
Barcelona has made the sensor it developed, Sentilo, available on the internet, meaning that city planers from around the world can study Barcelona’s smart city ventures and use the results as inspiration for their own projects.
The LED revolution has concluded, prices are falling and the industry’s attention is turning to the digital world, to the internet of things and smart cities.
In a Lux Today special edition, we examine smart cities and ask how is lighting improving our urban environments? Why are more and more cities adopting smart technology? And why does the lighting industry need to move quickly to take advantage of this new innovation?
In France’s Carrefour supermarket, visible light communication is used to transmit information to visitor’s smartphones.
Philips appears to be particularly interested in Luciom’s potential to improve Li-Fi in several ways, including speed, coding, decoding, and reliability.
Lux reveals that Philips Lighting, in a surprise move, is set to invest in Li-Fi, news that will bring credibility to the fledgling technology.
The development is the latest leap forward in the up-hill gallop that is the progression of Li-Fi, and is a move that will no-doubt raise the profile of the new technology, by rolling it out onto a bigger stage.
The first live demonstration of Li-Fi in front of an audience was given just a few weeks ago at LuxLive in London.
Recently though, the technology’s forward momentum seems to have slowed down a little, with limited pilot implementations and demos from vendors such as Scotland’s pureLi-Fi and others, being the only evidence of implementation of the technology in the field.
The news from Philips is likely to reverse this trend and the company looks set to invest in the technology in a push toward commercialising it.
The lighting giant is planning to leap into the new and, potentially, lucrative Li-Fi market, by purchasing Luciom, a small French company, which specialises in visible light communication (VLC).
‘Philips Lighting acquired Luciom at the end of 2016,’ a Philips spokesperson confirmed to Lux’s sister publication, LEDs Magazine, noting that all eight of Luciom’s employees now work for Philips.
Luciom is developing several technologies related to VLC, including Li-Fi. Philips appears to be particularly interested in Luciom’s potential to improve Li-Fi in several ways, including speed, coding, decoding and reliability.
Once Li-Fi spreads as a technology, it is hoped that it can become another means of wireless internet transmission, assisting and complementing Wi-Fi, by opening much more frequency to internet use.
Wi-Fi with its radio frequencies is more limited than the considerably wider spectrum of LED lightwaves on which Li-Fi data rides.
Luciom is best known for a ‘tagging’ scheme, which individual LED lights use to uniquely identify themselves in one-way indoor-positioning systems. Compared to two-way Li-Fi, indoor-positioning is a more basic form of VLC that sends small amounts of information from a light to a phone or other gadget.
A number of retailers are experimenting with one-way VLC to try to engage shoppers in stores with information and direct them to promotions. Philips has had a trial with a Carrefour store in France and with the Dubai-based retail chain aswaaq. In the US, Target is trialing the technology, although it has never revealed its supplier, as Lux Review reported last year.
Philips is believed to have acquired Luciom for less than €10 million. LEDs Magazine understands that at one point Philips might have raised patent infringement queries related to Luciom, which could have factored into the price of the purchase.
‘The terms of the acquisition were not disclosed,’ the Philips spokesperson said via email, in response to questions about any patent implications.
Customers use the app to receive information relevant to the items around them such as special offers and they can even look up prices of items on their phone instead of on the shelves.
Lux reports: UAE supermarket chain Aswaaq has become the first retailer in the Middle East to install connected lighting which communicates with its customers.
Its supermarket in Al Bada’a, Dubai, now boasts so-called Visible Light Communication technology, which is imperceptible to the human eye but detected by smart phone cameras. The lights act as a positioning system which allows shoppers to find items in the store to an accuracy of 30cm.
Smart-phone owners must first download the Aswaaq-branded app. This allows their phone to communicate with the individual light points transmitting their location through the high-frequency modulation of the light. The data stream is one-way and no personal data is collected by the lighting system.
They use the app to receive information relevant to the items around them such as special offers and they can even look up prices of items on their phone instead of on the shelves. The store managers can use the system to identify the most popular areas of the store to better place products, as well as help streamline tasks such as stock checks and restocking shelves.
The project has been installed by Philips Lighting and an American specialist in ‘digital store mapping’, Aisle411.
Other retailers trialling visible light communication include Target in the US, and Carrefour at its hypermarket in Lille, France.
There’s more cookies than meet the eye in Target these days: Indoor LED ceiling lights that can ‘spy’ on customers and send promotional messages to their smartphones – such as those that Target is trialling – could turn brick-and-mortar shopping into an online-like experience. Cookies and pop-ups can follow you, even in the physical world.
American retail giant Target has revealed that 100 of its stores are now deploying LED ceiling lights to track in-shop customers and guide them to relevant products via their smartphones, a nascent practice which could become the biggest thing in brick-and-mortar retail technology since the barcode.
The $73 billion chain told Lux that the scheme uses wireless signals that travel between LED lights and shoppers’ Android gadgets. The 100 locations mark the largest known deployment of ‘spy lights’ by any retailer, and could spur broader uptake.
Lux disclosed last April that Target was pioneering the technology at a small number of stores, where it is monitoring customers, pinging them with promotions, guiding them straight to relevant and discounted products, and tying them into loyalty schemes.
At the time the Minneapolis-based group declined to confirm it. The company has now decided to say more. But not much more.
‘This fall, in about 100 stores, Target began testing technology with new LED lights that can provide in-store location information to guests using the Android version of the Target app with select Android phones,’ a spokesperson told Lux. Target calls its customers ‘guests.’ The company made no mention of iPhone support.
Target would not reveal which wireless networking technology it is using. It is believed to be testing both ‘visible light communication’ (VLC), as we reported in April, as well as Bluetooth.
VLC encodes product information in the flickering wavelengths of LED light – the flicker is imperceptible to the human eye – and transmits that information to the camera of a user’s phone. Proponents of VLC say it is more accurate than other technologies such as Bluetooth, and can thus pinpoint a product and a customer’s location in a store and can more precisely steer a customer to a product in a large, difficult to navigate shop.
But advances in the better-known Bluetooth could possibly make it a contender for so-called ‘indoor positioning.’
‘With this pilot, the app provides “blue dot” navigation assistance in the app’s store map to help guests more easily find what they’re looking for as they shop our stores,’ the Target spokesperson said, noting that customers ‘can choose to disable this pilot functionality with the app.’ A ‘blue dot’ denotes a customer’s current location on a floor map of the store displayed on the Target app, he explained.
Other retailers are also experimenting with indoor positioning systems. France’s Carrefour, the world’s third largest retails chain, is running a pilot based on Philips technology at a 7,800-square foot outlet in Lille, France. Philips is considering offering VLC as a service.
GE claims to have two trial VLC customers in Europe and two in the US, although it will not publicly name them.
Target would not reveal the technology provider. In addition to Philips, VLC suppliers include GE, Acuity (which buoyed its VLC capabilities earlier this year by purchasing specialist ByteLight),Qualcomm and Scottish startup PureLiFi, among others. Acuity’s eldoLED division will demonstrate VLC at this week’s LuxLive exhibition in London on Wednesday and Thursday.
Smart lighting startup Gooee is marketing an embedded technology platform that provides indoor positioning through Bluetooth mesh. Indoor positioning is one feature among several in what Gooee calls its ‘IoT Stack’ – an ‘Internet of Things’ engine that when embedded in lights will help them intelligently support a host of operations including people and product tracking, building security, and lighting management and maintenance. Gooee is showing the technology at LuxLive.
Indoor positioning is expected to usher in a brave new era of personalising a shopper’s in-store shopping, and tailoring it with promotions, ads and information in a manner akin to today’s online shopping.
Looks like a streetlight, acts like a computer: GE LED streetlights in San Diego, where intelligent, connected lighting could monitor things like traffic and crime. The new ‘Current’ services group embraces CEO Jeff Immelt’s industrial internet strategy, treating LEDs as computers that route information. The conventional lighting group -no longer called GE Lighting- keeps the old stuff. It’s possibly for sale.
How do you make a viable business out of selling price-wracked LED lighting? If you’re a big industrial conglomerate like General Electric Co., you basically stop treating the bulbs as a sales and profit item, and instead consider them as a tool and a cost in a radically reshaped model that relies on selling a wide range of industrial and commercial services.
That is the take-away message from the $148.6 billion industrial giant’s most recent reorganisation of its lighting business in which it moved commercial and industrial LEDs into a broad new $1 billion “startup” energy services business called Current.
Less well-known in the shift: GE also quietly rubbed out its venerable GE Lighting escutcheon, and rebranded it as the Consumer and Conventional Lighting segment, including incandescent and fluorescent lighting as well as residential LEDs. Some observers expect GE to eventually sell that group, which meanwhile will continue to emphasise the sales of bulbs rather than fully embracing the newfangled service ethos of Current.
The idea of Current is that LEDs with all of their digital proclivities – including sensor and network connections – will be intelligent cogs in a wheel collecting and disseminating data for GE’s commercial and industrial customers. A Walmart might use LED-based ‘visible light communication’ to watch shoppers around physical stores and entice them with tailored promotions that the retailer sends to individuals’ phones. A city like San Diego might use streetlight sensors to monitor and manage traffic, crime, air quality and many other things.
It’s all part of GE CEO Jeff Immelt’s overarching ‘industrial internet’ strategy. Immelt has staked the future of the company on digitally connecting the tools and objects of the industrial world to create nothing less than what he calls ‘the next industrial era.’
‘GE is leading the way towards an age of brilliant machines that can harness reams of data to deliver transformative progress for people and businesses around the world,’ Immelt said when delivering the company’s annual 2014 results earlier this year, calling the industrial internet, ‘the connective tissue of twenty-first century infrastructure,’ and ‘the most important initiative I have led at GE.’
ANYTHING THAT CAN BE DIGITISED WILL BE
GE’s goal is to embed and connect sensors into everything in its habitat, whether it’s jet engines, gas turbines, locomotives or light bulbs. Those networked sensors would allow customers to gather data that helps them run the assets more efficiently, and users could leverage for other business purposes, such as analyzing shoppers’ movements.
From a lighting perspective, Current – officially called ‘Current, powered by GE’ – will not only help a commercial user engage with customers or manage inventory. It would also feed LED-linked information into GE’s cloud-based analytical software called Predix that scrutinizes mountains of data from a users’ solar panels, energy storage devices, electric vehicle charging stations and other sources, and helps make the most efficient use of electricity and decide things like when to sell excess power to the grid in the case of users generating their own.
‘It’s all about bringing to our customers what they tell us they’re looking for from a company like GE, and that’s to help them in a more holistic way solve a burning problem, which is how they become more energy efficient, more sustainable, and think in more of a solutions oriented approach (rather than ) a one-off solution or point solution,’ Current CEO and former GE Lighting CEO Maryrose Sylvester told Lux in an interview.
Current potentially puts teeth into Immelt’s industrial internet bite. And it could restore the financial outlook for the lighting business, where revenues from Sylvester’s so-called ‘point solutions’ appear to be in decline, or static at best. A year ago, around the time of GE’s last lighting reshuffle, the company told Lux that lighting had accounted for about $3 billion in revenue in 2013. Published reports indicate that the number fell to around $2.5 billion in 2014.
Sylvester would not verify the decrease. Publicly held GE does not break out lighting revenues in its financial line reporting. It includes them as part of ‘appliances & lighting’, a segment that includes washers and dryers and that GE is unloading to Swedish appliance firm Electrolux in a deal that has been delayed by antitrust scrutiny. The company’s Current press release last week described lighting as a $3 billion business.
PRICE DECLINES AND GUNSHOTS
While volume sales of LED lamps have grown, prices have dropped considerably. Three years ago they were around $25. Consumers balked, even with LEDs’ compelling attributes of providing 80-to-90 percent energy reduction, and lasting for a reputed 20 years or more. Today, sub-$5 prices are common for a single bulb; US retailer Home Depot is selling a 3-pack of GE 60-watt equivalent lamps for $10.97, or about $3.65 per unit.
‘The paybacks are getting to a point where it becomes a really good choice,’ notes Sylvester.
A good choice for consumers, but not one that supports a long term profitable business for GE, especially considering that there isn’t much of a replacement market for a product that lasts 20 years or more. Making things even tougher for an incumbent company like GE is that it continues to carry the costs of a traditonal lighitng business, including factories. Even as GE reported on Friday (16 Oct) that LED revenue was up 65 percent for the third quarter and now represents 39 percent of the lighting business, the cost and price outlook almost certainly taints the profits.
Thus, GE is moving to a Current-branded service-based business model, in which LEDs are a sort of loss leading but vital tool in a data services scheme. Those services are potentially as varied as anything that can be digitised in the potentially ubiquitous Internet of Things.
For example, GE is already piloting smart, Predix-connected streetlighting in San Diego and in Jacksonville, Fla., where sensors mounted on luminaires are helping with things like traffic and emergency response. Public outdoor smart city lighting schemes are taking hold in cities around the world, not just from GE, supporting a wide variety of operation such as parking, traffic, air quality, noise and even monitoring the bird population.
In an acoustic addition to its sensor stable, GE at the end of September began working with SST Inc. to use that company’s ShotSpotter technology to detect gunshots, which could link into police force and public safety operations.
SPY LIGHTS FOR RETAILERS
GE’s smart lighting reach extends to indoor environments such as Wal-mart and Walgreens – the largest drugstore chain in the US – which are already using GE LED lighting for energy saving purposes. Sylvester noted that GE is talking to both of them about possibly deploying visible light communication (VLC), a technology that GE is already piloting with two retailers each in the U.S. and Europe (it won’t reveal who).
In Europe, lighting rival Philips has signed up a Carrefour retail store in northern France to trial VLC. In the U.S., retail giant Target is also using the technology at a small number of stores, although Target declines to discuss the implementation or to identify the vendor.
Not to be forgotten in the brave new play of lighting-based digital services is that the LEDs will still, of course, provide illumination, even if lighting is ironically looking like an afterthought.
And while the LEDs will still offer significant energy advantages, those will become more de rigueur.
‘It’s our view that the energy efficiency benefit will be less material in a few years,’ notes Jed Dorsheimer, an analyst with investment bank Canaccord Genuity. ‘That’s not to say it’s less important. But the drivers toward solid state lighting will be about the other services and the things you can do when you digitise all these sockets.
‘For a large retailer, knowing what the floor traffic is on a real time basis and being able to harness that is probably more valuable in terms of inventory management than the energy savings are to their utility bill.’
Which is why GE, while retaining conventional lighting, will as Sylvester notes put ‘all the heavy investment…into the LED space.’
WITHER CONVENTIONAL LIGHTING?
That, in turn, rekindles speculation that GE will want to unload its traditional lighting business, now called Consumer and Conventional Lighting (CCL) after the breakup of GE Lighting into Current and CCL.
‘What happens to the GE Lighting legacy is a good question – I think it may mean that GE will be looking at selling that part of the business to somebody else, because in the end, it doesn’t form part of the core of GE,’ notes David Vos, an analyst with Barclays.
GE’s Sylvester says GE remains committed to the business, even after the breakup of GE Lighting. ‘We work to make sure we have the right products available for our customers when they need them,’ she says. Sylvester will oversee CCL as CEO; John Strainic will run it day-to-day as chief operations officer. Strainic had been general manager of GE’s North America consumer lighting.
It’s reminiscent of a year ago, when GE’s Beth Comstock, now vice chair, told Lux then that GE Lighting was not for sale. Soon after, GE disclosed a lighting reorganisation in which it aligned GE Lighting with an innovation group headed by Comstock.
The creation of Current marks the company’s latest attempt to stir up its LED business with an innovative business model. GE calls Current a ‘startup’ that groups together lighting with other existing business streams including revenue related to solar panels, electric vehicles and energy storage. It plans to grow those revenues from around $1 billion today to $5 billion by 2020.
It is piloting Current services with customers including Walgreens, Simon Property Group, Hilton Worldwide, JP Morgan Chase, Hospital Corporation of America (HCA), Intel and Trane, a brand of Ingersoll Rand, all of whom hope to drive energy efficiency, reduce costs and leverage data from connected devices like light bulbs.
‘It will be interesting to see how much commitment they’re truly going to make, or whether this is more of a marketing and PR type initiative,’ notes Canaccord’s Dorsheimer.
Wherever Current lies in the reality-to-PR spectrum, it’s coming from the very top of GE.
‘The combination of LEDs and analytics puts a computer where a light bulb used to be,’ CEO Immelt said earlier this year. ‘In cities around the world, GE is working to transform street lighting into the analytical brain of urban life. Today, lighting is becoming a high-tech infrastructure business. It is a gateway for most energy management solutions.’
Whether it is a profitable gateway remains to be seen.
