At this year’s CES, we said that 2011 would the year of the Smart Home Applications. To be sure, tablets took the forefront at the show, but the “smart home” could not be ignored. We estimated the US market value alone to be on the order of $5.6 billion by 2015. While the term “Smart Home Applications” could conceivably a variety of services, in our analysis, we included Remote Energy Management, Broadband-enabled home security, and Telepresence

Up until now, despite what seems like years of trade show mockups, demos, and media hype, Smart Home Applications have failed to garner the attention of Service Providers on any measurable scale. In 2011, market conditions and consumer interest appear to be finally aligning.

Two recent Service Provider announcements suggest momentum:

AT&T and Xanboo

AT&T’s acquisition of its longtime home monitoring and smart home application partner, Xanboo late last year garnered some brief media attention, then quickly receded below the radar. AT&T was—and continues to be—reluctant to disclose their plans with regards to the acquisition. A March 31^st letter sent by AT&T’s counsel terminating dealer relationships effective July 2011 suggests that the company may be preparing to rebrand and relaunch in the near future.

Verizon’s Moves in MDU

Verizon last week announced a partnership with Healthsense to provide remote health monitoring to senior communities—another indicator that years of industry talk is finally being converted into action. Penetrating the target-rich MDU (multi-dwelling unit) market is one way to reach CEO Ivan Seidenberg’s stated goal of 40% takeup of the FiOS service. Adding Cisco’s umi Telepresence to the mix could make virtual doctor consultations a reality though, as always, pricing is an issue.

Recent talks with clients confirm this renewed interest in the Smart Home area—Service Providers are clearly eager to uncover new revenue streams, and view Smart Home Apps (SHAs) as a new and uncluttered adjacent market.   They are likewise keen to mitigate churn, and our research has consistently shown that bundling provides some “insulation” against churn. Manufacturers see SHAs as a potential “hook” into the home, and are just as interested in how this plays out.