As smart home adoption grows, manufacturers are making key decisions that shape not just product features—but business models and brand identities. A clear split is emerging between “hero brands” like Google Nest, Amazon Ring, and Arlo, and rising Chinese-based manufacturers such as Aqara, Reolink, TP-Link, and Eufy.

Hero brands are increasingly shifting toward cloud-dependent services and subscription-based models. These players are betting on long-term revenue through bundled features, remote monitoring, and expanded ecosystems—moves that also come with recurring costs for consumers.

By contrast, Chinese-based manufacturers are disrupting this model with a growing portfolio of affordable, no-subscription smart home products. These brands are leaning into local processing, positioning themselves as privacy-conscious alternatives while offering competitive functionality without recurring fees. Reolink, for example, recently announced expanded Home Assistant integration, reinforcing its message of data privacy and local control. (Read Reolink’s blog).

Recent data from Parks Associates supports the tension in the market:

  • 23% of U.S. internet households own at least one smart appliance, up from 15% in 2020, signaling steady adoption across categories.
  • However, smart appliance purchase rates remain low (3%), due to high costs, long replacement cycles, and limited differentiation—pressures that low-cost, no-fee brands are actively exploiting. (Parks Associates Press Release)

The strategic divide around pricing, privacy, and control may become one of the defining stories of the smart home market in 2025. Whether as a complement to feature-rich ecosystems or as challengers to the status quo, these emerging brands are reshaping expectations—one local integration at a time.

Parks Associates will be presenting this data and more at the upcoming CONNECTIONS™: The Premier Connected Home Conference, May 13-15 at the Renaissance Dallas at Plano Legacy. CONNECTIONS™ is the only event to focus on the use cases and emerging connected home business models that will successfully engage consumers and grow revenues in the converging IoT industries, including smart home, connected entertainment, and mobile ecosystems. www.connectionsus.com
—
For more on this topic or to speak with a Parks Associates analyst, contact press@parksassociates.com.