Spotlight on connected systems with Wim Vangeenberghe

Andrew Gaved takes a deep dive into a connected future with Wim Vangeenberghe, President of Samsung Electronic Air Conditioners Europe.

Connectedness is a key theme for Wim Vangeenberghe, but given that Samsung currently leads the pack on the journey towards connected buildings and claims the largest portfolio of connected appliances by a comfortable margin, it is not surprising.

When we add in the considerable benefit of helping to accelerate the journey to net zero by optimising heat pump technology via its SmartThings platform, the importance of a connected future to Samsung and to the UK market is clear.

But the quest for connectedness was also a personal motivator for Wim in joining the company after a quarter of a century with rival Daikin.

Even when arriving at Samsung, the connected offering that was theoretically possible took time to emerge in practice – and that was down to culture, he says. “We have these fantastic products but we were not talking to each other – which was an opportunity missed, especially when our guys in TVs have a 40 or 50% market share and quite often our customers are the same. For example if they sell thousands of TV monitors to [fashion retailer] Zara, then we should be able to sell air conditioning to Zara at the same time, as they are already a customer of ours. So one and a half years ago, the chairman said, ‘Guys, you have to work together.’ So and now there are monthly meetings where people just exchange information, which is common sense.”

The company has also created a structure whereby a customer only has to see one Samsung manager – the connecting across departments is all done in the back office.

Increasing this communication and connectedness is a key goal for Wim. There is a sound logic: “if you look at the hardware of heat pumps, it is becoming more and more difficult to make a real differentiation between them,” he says, “We make excellent heat pumps, but I’m sure some of our competitors make excellent heat pumps as well. It comes down to a compressor and a heat exchanger and to differentiate in those components is becoming more and more difficult. Because it comes down to the limits of what is physically possible. With a compressor if it is just a few per cent more efficient than the previous version, you’ve done a great job. But that will not make a huge difference to the system. What will make the real difference is connectivity and communication.”

At this point we should point out that Samsung has just launched a new efficient heat pump – the EHS R290, which uses R290 refrigerant to achieve hot water temperatures up to 75 deg C.

The energy factor

The connectedness quest is seeing Samsung looking to collaborate more closely with energy companies, Wim says: “If we can say to an end user that they could reduce their energy bill by £200 a month, that’s something which makes a very convincing argument.”

Indeed, Samsung’s own survey showed that 71% of respondents saw energy efficiency as a key factor in a new home, and an even bigger proportion, 84%, cited reducing energy bills.

The potential cost savings get the electricity companies’ attention, but they are naturally very interested in the potential for communication with the homeowner too, he says, because they also have to address a major challenge – the stability of supply: “Energy companies want to try to control the consumer demand as much as possible. And if they can achieve this by integrating say heat pumps, EV chargers and batteries in each house, then they can predict the demand and then they know what they will pay for electricity in the next 24 or 48 hours. If they can control the demand and make sure the end users are using electricity when it’s cheap and not using it when it’s expensive, then that is for them a great benefit because on the European energy market they can buy with lower rates. So they are extremely interested to work with us in collaboration.”

And if Samsung wants to point to its differentiation in connectedness, it is in a pretty strong position: “We are lucky that we have a technology like SmartThings,” Wim says, “It is a platform that is not only able to combine with our products, but also the thousands of products from around 350 different manufacturers. And this is what the likes of British Gas and Octopus are very interested in, because it gives them the potential to save a lot of money. What is interesting is that with millions of customers, they are willing to share a part of this benefit with them. This is the future, I believe.”

Of course, the added benefit for the energy companies is that SmartThings means they don’t have to go through the connecting protocols to work with the smart products from multiple different manufacturers. And, notes Wim, that can be complicated:

“Making an app to combine products is not so difficult,” he says, “Our competitors could do it. But what is more complicated is everything around IT cybersecurity, data privacy and all those things. This is a nightmare for the ‘traditional’ heating and cooling manufacturers, whereas Samsung has experience with that, because that has been one of our main focuses [with the electronics division]. And that advantage, I think we will use more in the future.”

Communication is key

Of course, the electricity companies are also key because they offer the dual benefit of access to both a volume of customers and to smart tariffs, which will optimise the connected approach for the householder.

“But we cannot talk to every electricity provider because each one has its own system and you have to really define your cloud-to-cloud integration depending on what they have. So we are talking to the bigger companies, and that’s the same across Europe. And because there is no European [connection] standard, so we have to talk to every individual company.”

But the fact that SmartThings is compatible with thousands of products, putting clear blue water between the company and other rivals in the ‘smart’ arena, is not yet enough in itself, he stresses: “We don’t make EV chargers or solar panels or security systems. But we partner with the likes of ABB because if we don’t make them ourselves, we want to work with the best. And that’s a win-win for those suppliers, because they either don’t have the knowledge to create the platform for themselves or if they did do something themselves, they would only be able to do it for their own products. So we have created the tool – which is free of charge, let’s not forget.”

But there is another challenge with this connected future that Wim and Samsung are keen to address – the ability, or perhaps the willingness, of the traditional installer base of plumbers, air conditioning engineers and electricians to install the whole connected system.

“They know extremely well how to connect pipes – whether it’s refrigerant or water – or how to replace your compressor. But talking about installing software and explaining it to an end user, that’s a big challenge. When an installer can’t touch it, they don’t feel so confident. And that’s a challenge for us, but also for the whole installation world.”

Rising to the installer challenge

This is something that Samsung is setting out to address with its training programmes, but, Wim adds, this is something of a brave new world for many installers, so it is also about giving them confidence. “As an example, I had a simple split AC installed in my home and the guy who installed it did a great job – it was finished in a couple of hours. Perfect. But when I asked him to put it onto SmartThings, I could see the fear in his eyes. I showed him how and in 10 seconds it was done. He said, ‘Is it that simple?’ and I was able to reply “Yes, it is that simple.”

But will the connected system installer of the future come from the plumbing community or from electricians? Wim has a simple answer here too:

“We have no option. We have to train everybody. The plumbers will need to be trained because one day they could be without a job. And let’s be honest at the moment, if you’re young and you really want to earn some money, then heat pump installing is the way, plus it’s net zero, so it is trendy – you are helping to save the world. But these engineers who have been installing gas boilers for the last 50 years. It’s a huge change for them, I understand that. But we really have to train them.”

Connecting with housebuilders

But Samsung is also looking to convey the connected message to other large customers, such as housebuilders: “Housebuilders are interesting to us in the UK particularly,” says Wim, “Some are building tens of thousands of houses a year and the easier they can sell a house, the better for them. If they can go to an end user and say, ‘Look, your option is to go full zero emissions or zero energy, it’ll cost you £30,000 more, but you will save £3,000-£4,000 pounds per year on electricity,’ the consumer would pay that £30,000, because over a 30-year mortgage it’s next to nothing. So we have had some contact with housebuilders who have some of our SmartThings products in their showhouses now.”

As well as the advantage of dealing with a single manufacturer for all the appliances and the heat pump, the housebuilder has the added benefit of brand recognition: “They don’t have to explain to a customer who Samsung is, which you might with some of the heat pump rivals.”

The potential scale of such partnerships is demonstrated by its recent deal to kit out 8,500-homes on a single site in Wembley Park, North London for developer Quintain.

The commercial opportunity

Naturally, the concept of the connected building can also bring potential benefit to commercial building applications too, Wim says, but he notes that here the landscape is complicated. “Manufacturers seem to be trying to avoid this topic a bit because the solutions are not so straightforward. But there is a need for bigger units for commercial applications and more and more manufacturers will go for cascade systems, where they have one or two units of 40-50 kilowatts and you put them next to each other, connected on a water loop.”

The challenge for Samsung, is to persuade developers not just to replace their boilers with large heat pump chillers, which it doesn’t make. “You could replace them with an air-to-air heat pump system, but then we enter the world of refrigerant limitation [due to regulation] – so on the one hand, it is a big opportunity, but on the air conditioning side they are challenging times.”

However, when it comes to manufacturing the heat pumps, Wim is in no doubt that the traditional AC firms will be in the driving seat.

“Heat pump technology is basically compressor technology and here the air conditioning firms have 20 or 30 years of experience. Then there are the economies of scale: Samsung is making millions of air conditioners and millions of compressors, whereas there is not one heating player who has made one million heat pumps yet and for them making compressors is absolutely not possible. So they don’t have the technology and the economies of scale. However, what they do have is the installer base and the service networks. In every town and village in the UK they have their plumbers and they have the people.”

Thus the key task for Samsung in the UK is to build those networks and to train installers. To do that, he concludes, they need to convince a conservative installer base to move from manufacturers from whom they have been buying product for years and whose service they trust. “It’s a big challenge for us. That’s why I think the only way we could overcome that is by offering solutions which are better than they can offer – and connectivity is one of those. We can talk about our app, but when you check what installers really want, they want somewhere to pick up the phone when they have a problem. We have to show them, we have to convince them, we have to train them. Our brand will help and the younger generation will help for sure.”

You can come and talk to Samsung at InstallerSHOW, which takes place on 25-27 June at the NEC.

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