The trend of LED intelligent lighting is clear: analysis of current situation and future development

Intelligent lighting opens up the long-term growth space of the industry. LED intelligent lighting will enhance the ASP and added value of the product, and its development space is much larger than that of traditional lighting products. The long-term growth kinetic energy source after the rapid replacement period can be solved. On the basis of not considering high value-added products, the intelligent lighting industry will provide at least RMB 60 billion in market space in 2014-2015. If calculated according to 30% annual compound growth, the accumulated amount in five years exceeds 200 billion yuan.
Investment strategy: The establishment of intelligent lighting trends will open up a broader space for the LED industry. It is recommended to pay attention to the following main lines: 1) In the era of intelligent lighting, solution providers have the greatest voice, Philips and other advantages are obvious, and manufacturers with close cooperation will benefit, such as sunshine, Buddha photos, etc.; 2) among local lighting manufacturers, Enterprises with greater brand influence have the greatest potential to become solution providers, focusing on NVC, Dehao, Sunshine, Op, Foshan, Sanan, etc.; 3) Intelligent lighting market is more professional and requires strong technology and Support from the service team, the value of the engineering channel will be highlighted, paying attention to NVC, Dehao, etc.; 4) Tuobang shares, and controllers such as Hetai and Maoshuo Power Supply also have greater flexibility. It is recommended to recommend Sunlight, Sanan Optoelectronics and Dehao Runda, which have benefited significantly from the trend of intelligent lighting.

First, the establishment of intelligent lighting trends
1. Manufacturers are rushing to introduce new intelligent lighting. Intelligent lighting refers to distributed wireless telemetry, remote control, remote control using computer, wireless communication data transmission, spread spectrum power carrier communication technology, computer intelligent information processing and energy-saving electrical control technology. Control system to achieve intelligent control of lighting equipment. It has the functions of intensity adjustment, light soft start, timing control, scene setting, etc.; and achieves safety, energy saving, comfort and high efficiency.

From the recent market trends, smart lighting has become a new product that manufacturers such as Philips are vying to promote. At the Frankfurt show at the beginning of the year and at the Guangzhou Lighting Fair just after the end, smart lighting was also the subject of heated discussion. We believe that the trend of intelligent lighting has been established.


2. The market is in its infancy, and it is expected to enter the rapid development period in the next 1-2 years. Traditional lighting systems are artificially controlled to adjust the lighting requirements. The basic principle of the intelligent lighting system is that the user commands the terminal module (including the mobile terminal), transmits the signal to the control center software through the electronic induction, and adjusts the voltage and current amplitude of the circuit by the controller, thereby performing the intensity and color of the light source. Regulation. The entire system can be divided into intelligent lighting control systems, digital addressable LED drivers, lamps and light sources.
Figure 2: Schematic of the Marvell Intelligent Lighting Solution

A typical intelligent lighting system is to complete the transfer from the data command from the input to the output. Users can transfer data to the main controller (gateway) through various input methods (control software, sensors, smart sockets, etc.), and then the main controller realizes the output terminal ( LED downlight , LED panel light) through network protocols such as ZigBee. )control.
The current status of intelligent lighting platform is fragmented, there is no unified standard platform, between the various parts of the existing intelligent lighting system, from the control platform, control protocol to the light source products, because there is no uniform product standard, the market products are decentralized and fragmented. specialty. For example, only the control protocol currently has WIFI, Bluetooth, ZigBee and NFC, and the control platform also has IOS, Android and so on.

Lighting manufacturers bet ZigBee. Many manufacturers of lighting have begun to introduce their own intelligent lighting products. ZigBee has won the favor of most lighting manufacturers because of its low power consumption, low cost, safety and speed, and has become the network agreement adopted by its new products. Major companies such as GE, Philips, Osram, and Toshiba have formed alliances to promote the Zigbee agreement, which is expected to become a common standard for future industries.

We believe that in the early stages of market development, the lack of standards has caused manufacturers to be confused and hesitant. If Zigbee becomes the industry standard, it will eliminate the doubts of the manufacturer to some extent. The diversity of control platforms and product forms still provides sufficient design freedom. By then, the industry will present a scene of blooming flowers, and various manufacturers will increase their promotion efforts. The market is expected to enter a period of rapid development in the next 1-2 years.
3, intelligent lighting features rich, value-added huge intelligent lighting is the essence of electronic and network, not only can achieve intelligent control of the lighting system, but also an entry point of the Internet, thereby generating more high value-added services, such as health management , map positioning, merchandise shopping guides and advertising, and more.
1) Scene lighting Intelligent lighting system can automatically adjust the intensity and color of light in the room according to the lighting environment of the user and the user's personal preference. For example, when the outdoor weather is good and the sunlight is strong, the system will automatically dim the light to save energy; when the outdoor cloud is dense and the sun is dim, the system will automatically adjust the light to meet the user's light demand. In recent years, with the development of smart terminals and concepts, users can even adjust the lights directly on their smartphones.
2) LED optical communication visible light communication (VLC) is a technology that is being studied by major companies. It can use LED lighting technology to achieve data transmission by adjusting the visible light frequency to achieve data communication. In intelligent lighting, system control is mainly done by digitization, so LED visible light communication is also easier to implement.

3) Healthy lighting to create a better light environment is also one of the purposes of intelligent lighting. As the current "light pollution, light radiation" problem has gradually been valued by people, creating a healthy lighting environment has become the most effective solution in this regard. The future intelligent lighting system will be able to reshape the light environment according to people's needs, and simultaneously reduce the negative effects such as stroboscopic, which can be closely integrated with health care.
4) Other derivative value-added services On the basis of automatic adjustment and LED optical communication functions, the intelligent lighting system as an entrance to the Internet can also bring more value-added functions. These include map positioning, integration with home and terminal sensors, and medical health monitoring.

Figure 5: Derivative value-added services enable map sharing and precise location through optical communications. Data transmission can be realized by LED optical communication, which can be combined with existing map positioning functions to provide GPS positioning and emergency notification services for some underground passages, buildings and other places where GPS cannot be used.
Integrate with home and terminal sensor. The intelligent lighting system can monitor the temperature and humidity of the building in combination with the home sensor to adjust the various indicators of the room to the most suitable state. In addition, the video and audio transmission can be combined with the smart phone and the terminal.
Monitor physical health indicators. Taking into account the modern user's attention to personal health, the intelligent lighting system can be combined with human health monitoring sensors to monitor the user's fear, heart rate, body temperature and other indicators, and can provide adjustment suggestions for users in combination with smart medical equipment.
Take Philips' Hue as an example. This product is not only dimmable, color-coded, but also customizable via iOS or Android software. For example, a control module is integrated in Apple's latest i〇S 8 system notification center, allowing users to quickly turn lights on or off or change their colors without having to launch a dedicated application and unlock the phone screen.

And Philips' latest intelligent lighting platform can complete the intelligent product control of different scenes, allowing users to connect the LED lighting equipment in the system at any time outdoors and indoors.

On the road, the LED street light will be instantaneously connected to the system when it is powered on, and the street light and its identification data will automatically appear in the correct position on the map. You can start managing these lighting points with just a few clicks.
In the supermarket, when customers shop in the store, they only need to install a related application on the mobile phone to connect with the lighting system in the store, so as to obtain relevant products and preferential information according to the location of the store.
In the office, a connected office lighting system powered by Ethernet, a line can do two things • power and transmit data. The lighting system can be turned into an information channel, and the system software can analyze the relevant data of space utilization, so that the building managers can make more reasonable decisions on lighting and heating.



Second, industry ecology and profit model speculation
1. The role played by different manufacturers As mentioned above, a complete intelligent lighting system includes lighting fixtures and light sources, central control systems (gateways, etc.) and terminal control applications (mobile phone apps, etc.) from upstream to downstream. According to the different nodes, the industry chain participants mainly include lighting manufacturers, controller manufacturers and Internet vendors.

1) Lighting manufacturers Lighting manufacturers generally refer to manufacturers that provide base-to-lighting facilities. They provide lamps and LED light sources for the entire system, such as Philips, Sunshine, NVC, and Chau Ming, Hongli, etc., which have been transformed from traditional lighting. LED application company.
2) Controller manufacturer controller manufacturer as the middle chain of the industry chain, providing software and hardware control center for the entire intelligent lighting system, including LED driver, gateway, controller and various interfaces. Controller vendors play the role of the upstream and downstream hubs of the industry. The advantage lies in the understanding of core control technologies that can be rapidly changed or adjusted to produce a diverse range of products. On behalf of the listing including Tuobang shares, and Hetai, Maoshuo power supply, etc., Philips, GE and other foreign major manufacturers also have a strong controller business base reduction.
3) Internet vendors/platform operators Internet vendors mainly provide external Internet input interfaces, including mobile terminal application interfaces. Its strength lies in its flexibility and strong product marketing capabilities. Due to its user-oriented needs, it is able to position products more accurately, and with its stable application development capabilities, it can quickly and accurately promote products. Representative companies include Apple, Google, Xiaomi, etc.
2, lighting manufacturers and Internet companies to increase cooperation is a high probability event through the above analysis of the role of the three manufacturers we have a preliminary understanding of the division of the entire industry chain. Intelligent lighting belongs to the category of smart home. Its development requires the cooperation of the whole industry chain, and the future will lead to a major change in the industry ecology.

We guess the profit model of various roles in the future smart lighting market as follows:
1) The role of traditional luminaire manufacturers and controller manufacturers is still dominated by product suppliers, including OEM/ODM services for system integrators. If the brand operation is successful, it will have the potential to transform into system integrators, such as NVC. The company’s own brand influence has gradually increased, and it is expected to take the lead in the era of intelligent lighting;
2) The traditional lighting solution providers such as Philips are the main system integrators in the future, and their advantages are the whole industry chain layout and strong brand effect;
3) The Internet vendor/platform operator is located downstream and will focus on marketing and promotion with the highest added value.
Overall, we believe that industrial integration based on specialized production will be the development direction of smart lighting in the future. Specialized production is the survival basis for luminaire manufacturers and controller manufacturers. System integrators and platform operators have greater voice in the industry.
Figure 12: The development direction of the intelligent lighting industry

At the same time, lighting manufacturers and Internet companies to increase cooperation is a high probability event. In June 2014, Apple launched the “Homekit” smart home platform at the WWDC conference, marking that Apple officially entered the smart home industry with its strong technology company status.
We learned from industry research that lighting manufacturers are open to Homekit, Philips Hue has supported i〇S8, and more smart light bulbs will be integrated into such open platforms in the future.


Third, intelligent lighting to open the industry long-term growth space <br> For the sustainability of the LED industry growth, the market disputes mainly come from the following points: 1) How long can replace the market to support the rapid development of the industry? 2) Is the life of LED lamps long? 3) After the rapid replacement period, where does the industry's growth momentum come from?
Regarding the first question, the US Department of Energy data shows that the penetration rate of LED lighting in the US market in 2013 is still less than 5%. Assuming that the penetration rate doubles every year, the replacement demand can last for 3-4 years. As for the LED lighting life, we believe that in the rapid development of LED lighting, long life is not the most important factor for manufacturers, but to reduce the cost as much as possible under the premise of meeting the life standard (2-3 million hours), and the manufacturers are mature after the industry matures. Will not do the product life at all costs to the extreme. Finally, LED intelligent lighting will enhance the ASP and added value of the product, and its development space is much larger than that of traditional lighting products. The long-term growth kinetic energy source after the rapid replacement period can be solved.

According to market research, we learned that the cost of an LED driver with intelligent control function is generally less than 10 yuan. The ex-factory price of lighting fixtures with such power supply is 20%-30% higher than that of ordinary lamps. Intelligent configuration can add at least a 20% premium to common luminaire products (and this is regardless of the addition of more complex systems and higher-end configurations).
We refer to the CSA's statistics and forecasts for the LED general lighting market in 2009-2015, while conservatively assuming a premium of 20% for smart lighting products, the new market space for smart lighting in the industry in 2014 and 2015 is approximately 26 billion respectively. Yuan and 360 billion yuan.

According to this calculation, based on the high value-added products, the smart lighting industry will provide at least RMB 60 billion in market space in 2014-2015. If calculated according to 30% annual compound growth, it is conservatively estimated that this value will reach nearly 80 billion yuan by 2018, and the accumulated amount in the five years will exceed 200 billion yuan.

IV. Investment Strategy <br> The establishment of intelligent lighting trends will open up a broader space for growth in the LED industry. We believe that smart lighting will enter a period of rapid development in the next 1-2 years. It is recommended to lay out LED intelligent lighting panels and pay attention to the following main lines:
1) In the era of intelligent lighting, solution providers have the greatest voice, Philips and other advantages are obvious, and manufacturers with close cooperation will benefit, such as sunshine, Buddha photos, etc.;
2) Among the local lighting manufacturers, the enterprises with greater brand influence have the greatest potential to become solution providers, focusing on NVC, Dehao, Sunshine, Op, Buddha, Sanan, etc.;
3) The intelligent lighting market is more professional and requires strong technical and service team support. The value of the engineering channel will be highlighted, focusing on NVC and Dehao;
4) The controller companies such as Tuobang, Hetai and Maoshuo Power Supply also have greater flexibility.
Maintain “recommendation” in the LED industry, continue to strongly recommend Sanan, Sunshine, and Jufei, and carefully recommend Dehao, Zhouming, Hongli, Ruifeng, and recommend focusing on related companies that benefit significantly from smart lighting trends such as Sunshine and Sanan. Dehao and so on.
1. Sunlight lighting intelligent lighting products have been available. In the early days of LED lighting, the sun was decisively reducing the investment in traditional lighting products, and the expansion of LED production capacity greatly reflected the forward-looking management. Now the company clearly sees the clear signal of intelligent lighting.
At the beginning of this year, we have set up an intelligent lighting team, and invested heavily in research and development, and we are at the forefront among local companies. On June 26th, Sunshine and Jingdong held the "Intelligent Hardware Leadership Summit" to launch new self-owned brand products such as smart ceiling lamps, downlights and bulbs, indicating that intelligence has become a key development direction of the company. We judge that Sunshine Smart New Products will enter the stage of market operation in the third quarter, and it is expected to generate a large income contribution during the year.
Close relationship with system integrators will directly benefit from smart lighting trends. Providing ODM services to foreign major manufacturers such as Philips, Osram, GE and Toshiba has been Sunshine's main source of profit, with revenue accounting for 60-80%. We believe that traditional solution providers such as Philips will be the main system integrators of smart lighting in the future, with strong competitiveness.
Sunshine will also benefit significantly as a member of its supply system.
The future is expected to shift from product providers to system integrators. In recent years, Sunshine has also increased its investment in its own brands and channels. As the brand's influence increases and management capabilities improve, it will not rule out the transition to system integrators in the future.
2, Sanan photoelectric layout lighting application opens up huge growth space. LED lighting is in the early stage of rapid development. In 2015, the mainland's output value reached 180 billion, and Sanan cut into lighting applications to open more than 10 times the market space. At present, Sanan's model of expanding its application products business has covered direct government projects, supply of engineering companies, and joint ventures with application companies. At the same time, with the increasing recognition of Sanan in the world, the possibility of cooperation between the company and international lighting giants is not ruled out. In addition, Sanan has been deployed in the field of automotive lighting and has become a new growth point for its lighting business.
Power semiconductors are expected to form synergies with the lighting application business. The market for GaN and SiC power semiconductor devices is equivalent to LED. Sanan has established a joint venture with Chengdu Yaguang, which is expected to generate a large revenue contribution this year. At the same time, because power semiconductor devices are mainly used in control circuits and other fields, Sanan's power semiconductor products are expected to help the company enter the smart lighting application market.
3, Dehao / NVC lighting brand effect is significant. NVC is a traditional brand in the lighting industry, and the alliance with the new regulation of Dehao Runda enhances the brand effect of both. There are 3,300 NVC stores, and the coverage rate in county-level areas has reached over 97%. At the same time, NVC has always emphasized the brand image of its "light environment experts". We believe that a good brand helps the two to transform into a system integrator, thus occupying a favorable position in the smart lighting market.
Quality engineering channels help spur the smart lighting market. The smart lighting market is more professional, not only requires a lot of investment in product development and production, but also the back-end service links are supported by strong technical and service teams. The advantages of NVC's channel are mainly reflected in the engineering field. We believe that strong engineering partner will greatly enhance the competitiveness of Dehao and NVC.
risk warning:
Intelligent lighting development is lower than expected; technical route risk.