LG Electronics is stepping up its game in the smart home sector with a bold acquisition. The tech giant has acquired an 80 percent stake in Athom, a leading smart home platform company based in Enschede, Netherlands. With plans to purchase the remaining 20 percent within the next three years, LG is positioning itself at the forefront of AI-driven home innovation.

What This Means for Smart Homes

LG’s acquisition of Athom isn’t just about expanding its portfolio; it’s about creating a seamless, AI-powered smart home ecosystem. Athom’s flagship product, the Homey smart home hub, is known for connecting over 50,000 devices across brands like Philips Hue and IKEA. By integrating Athom’s extensive connectivity with LG’s generative AI-enabled ThinQTM platform, LG aims to create an AI home that adapts to the user’s preferences, managing appliances and IoT devices to deliver a personalized living environment.

LG envisions taking the AI home concept beyond residential spaces. The company plans to introduce AI-driven solutions to commercial spaces and mobility environments, advancing the idea of ‘Intelligent Space.’ This move is part of LG’s broader strategy to transition from a hardware-centric business to a software-based platform business, offering continuous, value-added services through AI and connectivity.

Athom’s Role and Future

Founded in 2014, Athom has made a name for itself with the Homey hub and OS, creating an independent smart home ecosystem. Available in Europe, Australia, Singapore, the US, and Canada, Homey has a loyal customer base and a robust App Store offering around 1,000 applications for device connectivity and control. Despite the acquisition, Athom will continue to operate independently, ensuring it retains its unique strengths and growth potential while contributing to LG’s ecosystem.

This acquisition is a significant milestone for LG as it enhances the scalability of AI homes. By incorporating third-party devices and services into its ecosystem, LG will gain deeper insights into customer usage patterns and deliver more personalized services.

“The acquisition of Athom is a cornerstone for our AI home business,” said Jung Ki-hyun, executive vice president and head of LG’s Platform Business Center. “By leveraging the synergy between the two companies, we will expand our open ecosystem and external integration services, aiming to provide customers with more diverse and multidimensional space experiences.”

Strategic Investments and Market Growth

LG’s shift towards a software-based platform business began in 2021 when it expanded its TV business with the webOS platform and acquired Alphonso, now LG Ad Solutions. The acquisition of Athom is another strategic investment in this direction.

According to TechNavio, the global smart home market is set to grow from USD 81.2 billion in 2023 to USD 260.24 billion by 2028, with an average annual growth rate of 26.23 percent. LG is clearly aiming to capture a significant share of this booming market.

“LG is evolving into an intelligent space solutions company that connects and expands experiences in various living spaces. We will continue to make strategic investments to shift our business paradigm,” said William Cho, CEO of LG Electronics.