The Future of Smart Homes with HEMS

In June of this year, Fortune China released "The 2023 Representative Chinese Companies in Overseas Market" list. The list highlights Chinese companies and their growing influence as they explore new frontiers across seven tracks. Among these, the Enterprise Service stands out as a popular track. Tuya Smart, a key player in the track, holds the title of being the No. 1 Internet of Things (IoT) PaaS provider in the world in terms of shipment volume. Operating under the "B2B2C" business model, Tuya Smart serves as an IoT developer platform, engaging a massive community of over 700,000 platform developers. The company has successfully gone public in New York and Hong Kong, becoming the first stock of global IoT cloud platform.

As a global company, Tuya Smart's model of providing one-stop services to overseas businesses has been successful, especially compared to the traditional model of selling product in global markets. This success is not only due to its innovation in the IoT field, but also due to its long-term cooperation with Amazon Web Services (AWS). On AWS, Tuya Smart currently provides IoT services to 220 countries and regions globally, its services cover nearly every corner of the world.

Moreover, facing challenges of global warming and the competitive IoT market, Tuya Smart has made early arrangements in frontier areas such as Energy Management System (HEMS) to truly achieve sustainable development, and seize the business opportunities in this emerging market.

Over the nine years since its founding, there is a series of questions for Tuya Smart. What successful experiences and insights has it gained in the overseas market? How has its cooperation with AWS enhanced its industrial value chain? What shortcomings still need to be overcome in the current overseas situation? What opportunities does the emerging HEMS mean for Chinese companies? With these questions, Fortune China recently had an exclusive interview with Ms. Jingdan Na, Vice President of Marketing and Strategy and Chief Marketing Officer (CMO) at Tuya Smart.

Ms. Na believes the synergy of technology, platform, and reputation drives numerous large enterprises and developers to collaborate with Tuya in building the IoT ecosystem. Meanwhile, the emerging HEMS has promising prospects. It is not only the entry point for the integration of IoT and new energy, but also the trend of achieving carbon peaking and carbon neutrality goals. In the future market, HEMS can be in high demand. It is optimistically estimated that it will gain success in the European and American markets first.

Transitioning from empowering smart homes to providing home new energy management solutions seems to be a wild venture, but in Ms. Na's view, this is a huge blue ocean market, and the venture is in the line with Tuya's core competencies.

"Tuya Smart serves as a platform and has diverse observations, so it can identify blind spots for other enterprises more easily," Ms. Na explained. In recent years, energy prices in Europe and America have skyrocketed. "People used to not care about electricity bills, but now an increasing number of consumers and companies are starting to explore ways to save electricity."

From a global perspective, on the one hand, energy prices are rising; on the other hand, the target date for implementing the Paris Agreement, which aims to address climate change, is approaching, and the concepts of zero carbon and peak carbon have taken hold. Regarding this, Ms. Na believes the best market is Europe and America, especially Europe according to market research.

"I think the European market is the most receptive and demanding of innovation. The cost of electricity in Europe is too high, so it is feasible to impress consumers with value-added services that can save electricity. " Ms. Na said.

Ten years ago, the price of smart home products seems unattainable, but now they have been common for households. Since the number of globally connected smart home products has exceeded tens of billions, the realization of HEMS products will also be attainable in the future. Especially if the global heatwaves continue in the summer, the pace from vision to reality may significantly accelerate.

From the perspective of the development of the smart home industry, solutions for audio-visual entertainment, home & living, and home security systems have been greatly enriched, and the market competition is extremely intense. However, the smart energy management field that has been neglected for a long time is still in its early stages of development, which means it has huge potential and is truly a blue ocean market. 

Considering the business development aspect, Tuya Smart seized the opportunity of explosive growth trend of smart homes nine years ago, and firmly established the path of platform-based development with a focus on 'connectivity + ecosystem'. Cooperating with AWS, Tuya Smart has a significant chance to reap the rewards in the forefront layout of HEMS when the next decade's opportunity arrives.

"Choosing a reliable technological service provider like AWS can help us solve the real pain points of going global," Ms. Na emphasized.

In China, the going global story such as Tuya Smart on AWS is not unique. AWS ranks top in worldwide and Asia Pacific "IDC MarketScape IaaS Provider" and takes 80% market share of Chinese enterprises going global. By industry-leading security and compliance, global infrastructure, over 200 types of cloud services, global partner network, mature and rich customer experiences, and powerfully global business ecosystem, AWS has been providing sustained and reliable support for Chinese enterprises' overseas expansion for the past decade.

Recalling the cooperation with AWS, Ms. Na shared a detail: " Both companies have flat organizational structures, so we can work together to server local customer, and respond to customers’ need in a timely manner. " This also reveals the success secret of Tuya Smart as a "B2B2C" company: standing on the shoulders of giants.