Convenience, Not Cleantech Drives Internet of Things Opportunity

Energy savings that come from using networked devices make the concept of the “Internet of Things” an obvious cleantech play. But getting people to adopt these new systems might come down to the technology’s ability to adapt to, and perhaps improve upon, familiar patterns of human behavior—such as checking the refrigerator.

Tony Atti, CEO of Durham, NC, semiconductor startup Phononic, points to medical refrigeration units that store laboratory samples. At hospitals using conventional refrigerators, nurses ensure proper temperatures by manually checking units at regular intervals, then logging the results on paper. But “smart refrigerators” can use sensors to monitor temperature, maintenance, and power, Atti said, speaking this week at a networking event jointly hosted by the Research Triangle Cleantech Cluster and the NC Regional Internet of Things.

Nurses no longer need to periodically check the fridge. When problems arise, the refrigerator sends an e-mail alert to hospital staff—a change in hospital procedure that improves staff responsiveness and productivity. It’s an example of technology providing a solution that users never would have thought of on their own, Atti said. In these instances, companies need to teach customers how the technology fits into their lives and work routines.

“We want to wrap that Internet of Things story with things that are conventional,” Atti said.

Phononic manufacturers a solid-state heat pump that takes the place of a compressor in conventional refrigerators and cooling units. The company closed a $44.5 million Series D round last December, which the company is using to ramp up its manufacturing capabilities as it bring its energy-saving technology into home refrigerators, medical facility refrigerators, electronics cooling, and data center cooling systems. Atti said Phononic is already producing heat pumps for an undisclosed China-based manufacturer to incorporate into its refrigerator production line.

LED lighting company Cree (NASDAQ: CREE), also headquartered in Durham, reached global scale before the Internet of Things became a tech buzz word. The company makes lighting components used in streetlights, parking garages, campuses, and other municipal and corporate applications. Cree entered the consumer market in 2013 with an LED light bulb intended for home use.

Business and home users of LEDs bulbs could find energy savings each time they switch on a lighting fixture. The U.S. Department of Energy calculates energy savings of up to 80 percent when LED bulbs are compared to incandescent bulbs. Cree R&D Manager Matt Reynolds, who also spoke at the cleantech event, said the Internet of Things opportunity for his company lies in LED lighting’s ability to slide into building automation. When buildings and homes are automated, people don’t need to remember to turn lights off or to adjust thermostats up or down.

Cree’s own automation system, SmartCast, manages lighting with a network of lighting fixtures that communicate with each other without additional wires or equipment. That network senses the presence of people and turns lights on or off depending on whether someone is in a room. In a sunlit room, SmartCast dims lights to save energy.

John Austin, director of Durham startup accelerator Groundwork Labs, sees opportunities for the Internet of Things to change people’s behavior. But legacy technology can be a tough obstacle. Getting people to change how they do things is really hard, even if you’ve got a better solution, he said.

Still, Reynolds added that technology advances don’t necessarily mean that all new devices need to become part of the Internet of Things. “You have to have a tangible benefit,” he said. “Just because you can connect it to the Internet doesn’t mean you have to connect it to the Internet.”

Frank Vinluan is editor of Xconomy Raleigh-Durham, based in Research Triangle Park. You can reach him at fvinluan [at] xconomy.com Follow @frankvinluan

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