Subscribe to our Newsletter | To Post On IoT Central, Click here


Platforms (85)

5 IoT-based Business Models to Leverage

The deployment of the Internet of Things (IoT) has disrupted niche organizations across multiple industries like financial services, technology, agricultural equipment etc. The organizations are shifting from traditional products to smart offerings and outcome-based deliverables.

Evolution of technology

We have progressed from reading a physical copy (paperback and hardcover) of the book to reading it on your device or on Kindle. We furthermore explored the traditional way of reading a book with the audio version of the book. We now can not only download the book and read it anywhere on our smartphones but can also just plug in the earphones and listen to it. This is defined by the progressive model by Amazon:

Amazon →Kindle →Echo →Audible

We need to evolve in a similar manner in the industrial world by thinking of the offer from the consumer’s perspective. Efficiently creating and monetizing value shared by IoT solutions will lead us to profitable outcomes.

Impact of IoT on businesses

Machina Research expands the scope of its IoT forecasts and highlights a USD 4 trillion revenue opportunity in 2025.

Business models require thinking through the consumption side of the offer (demand side). This explores the demand of the product and its usage. Your customers don’t merely purchase your product. They furthermore look for more opportunities – what they want is what your product can do for them. And hence, it is important to understand the consumer aspects of your offerings. Moreover, the business models also require thinking on the production side of the offer (supply side). This helps you better understand how the IoT product is created and delivered for a symbiotic growth.

Let’s further explore various IoT-based business models.

Product Business Model

This model enables to provide your customers with a physical IoT product and the software. You gradually can upgrade the software by notifying the customers of its cost and it will mirror the results at the consumer-end directly.

Example:

Let’s take an example of the self-driving cars. The company doesn’t have to additionally provide any product to the users; instead it can continuously improve the car by updating its onboard model and application. The firm can introduce a new feature and update its users by sending a notification. The users will just have to update the system to leverage that feature.

You can also use this model to collect data to create information service products to eventually sell with the product-service model.

Product-Service Business Model

This is a hybrid version of the traditional product business model and the newer service business models. This model enables organizations to offer a physical IoT product along with an informative model. Implementing information service to a product based on its collected data will ensure incremental revenue and provide a competitive advantage. Providing continual information to monetize the availability of the analyzed data that enhance the consumer’s process is the key of this business model.

Example:

Let’s take an example of ‘connected vehicles’. With the attached Onboard Diagnostic II chip, users will be able to know the temperature, RPM count, pressure, engine load, location of the vehicle, and fuel level. This information-based model revolves around vehicle safety, saving fuel and ultimately, reducing the maintenance cost. This information or data is the key for predictive maintenance that allows the customers to know the health of their vehicles to further avoid any mishap.

Service Business Model

This is a XAAS – Anything As A Service business model. The company rents a physical product with IoT solution and pays for it only for a period while it is running or working. The service business model is not exclusively related to software or physical products; it can also include the information products. This model allows the organizations to have a predictable and recurring revenue stream by providing their IoT services to the customers for a certain time period. However, your IoT solution must not only have value as a service, but, it must be aligned with how the customer expects to receive, consume and pay for the offering.

Example:

Let’s take an example of jet engines. The customers that don’t want to own and maintain the engines by themselves lease the IoT-based jet engines from the seller. The seller also provides maintenance by implementing predictive analytics. The customer pays for only the times where the engines were running and producing outcomes for them.

Service-Outcome Business Model

In the service-outcome business model, the seller becomes a business partner. There are two aspects of the service-outcome model. The first aspect is similar to the service model but instead of focusing on offering a single solution, there are product lines that are monetized. The other model comprises of monetizing based on the outcome or the performance of the offered solution.

The service-outcome business model has an add-on payment based on saving that incentivizes the vendor to improve its customer’s business. The add-on payment in this situation would be related to the reduction in human operating expenses.

Example:

Let’s take an example of the mining industry. Instead of providing the mining equipment, the company provides IoT solution for the equipment to their customers. And based on the data collected with the use of that IoT solution, the company can further adjust the equipment in accordance with the parameters of the better-performing ones. By adopting the service-outcome business model, both, the buyer and the seller receives an incremental value. This enables them to establish a baseline and generate a percentage of the incremental revenue or incremental savings based on phases or milestones.

Outcome Business Model

The final business model comprises of an entire IoT ecosystem. It brings together the producers (vendors) and the consumers (customers) of the IoT technology in order to monetize the solution. Instead of partnering with multiple vendors, the customer becomes part of an ecosystem that delivers the desired outcome.

This goes beyond the service-outcome business model where payment now is completely based on performance. This allows the alignment of the business models of the vendors with that of the customers.

Example:

Let’s take an example of smart farming. The outcome business model focuses on providing a bundled solution for an effective agricultural solution. Instead of providing separate solution for monitoring the moisture level of the soil, the sunlight, and the CO2 emissions, this model offers a set of solution that combines all these in a package. Separately, each of these separate product categories provides value, but when allied, dependencies are organized, creating greater value than the sum of the parts. This enhances the monetization aspect of the solution for the customers as well as the vendors as the payment will take place according to the outcome that each solution provides.

Analyzing business needs through IoT

The greatest challenge in implementing IoT isn’t technical. The key challenge lies in the business aspect. The challenges are further followed by lack of standardization and strong security. However, these are not the kind of challenges that can’t be addressed and solved by any organization. The key focus should be on using IoT technology to deliver and monetize outcomes.

Business issues may be more challenging than technology. Inculcating IoT solutions into your business practice does not mean you must change your business model too. It is equally important to align your sales and distribution goals along with implementing IoT initiatives. You can then continue on the IoT business model continuum as the time progresses.

Outcomes effectively revamp industries. They impact the business in a way that enables you to identify your competitors and partners. This reduces competitive risk and prepares you to decide when to spend the time and the resources needed to develop your IoT business and product line.

Read more…

Connected Cars: From the Edge to the Cloud

Many of us have yet to see an autonomous vehicle driving down the road, but it will be here faster than we can image. The car of tomorrow is connected, data-rich and autonomous. As 5G networks come online, sensors improve and compute and memory become faster and cheaper, the amount of data a vehicle will generate is expected to be 40 terabytes of data every day. This will make the autonomous vehicle the ultimate edge computing device.

Last week at Mobile World Congress Americas in San Francisco, Micron Technology hosted a panel discussion with automotive industry experts where they discussed the future of the connected car and the role of both the cloud and the edge in delivering the full promise of autonomous driving (FYI – Cars are now big at wireless trade shows. See Connected Vehicle Summit at MWC).

Experts from Micron, NVIDIA, Microsoft and Qualcomm discussed what 5G, cloud, IoT and edge analytics will mean for next-generation compute models and the automobile.

Micron claims to be the #1 memory supplier to the automotive industry and notes that its technology will be required to access the massive streams of data from vehicles. This data must be processed and analyzed, both in the car and in the cloud. Think about going down the road at 70 MPH in an autonomous vehicle. You need to have safe, secure and highly-responsive solutions, relying on split second decisions powered by enormous amounts of data. To quickly analyze the data necessary for future autonomous vehicles, higher bandwidth memory and storage solutions are required.

Smart, connected vehicles are the poster child for edge computing and IoT.

Some intriguing quotes from the discussion:

  • “In last seven years 5839 patents have been granted for autonomous vehicle technology.” – Steve Brown, Moderator and Futurist
  • “There is a proactive side of autonomous driving that can’t be fulfilled at the edge.” Doug Seven, Head of Connected Vehicle Platform, Microsoft
  • “The thin client model won’t work for automobiles. You won’t have connectivity all the time.” Steve Pawlowski, Vice President Advanced Computing Solutions, Micron
  • “Once you have enough autonomous vehicles, the humans are the danger.” Tim Wong, Director of Technical Program Management for Autonomous Vehicles, NVIDIA

The entire panel discussion can be found in the video below.

Disclaimer: The author of this post has a paid consulting relationship with Micron Technology. 

Read more…

The Information Value Chain

Why do IoT Architects need to think about value, not just data?

Several years ago I was pitching what would now be called an Industrial Internet of Things (IIoT) solution to the Production Manager of a large manufacturing plant. After describing all the data we could collect, and the metrics we could turn it into, I thought I had done pretty well. What Production Manager wouldn't want our system to get his finger on the pulse of his operation?

Instead, his next question floored me:

"If I don't do anything with the data your system collects, then it doesn't create any value for me, does it?"

I had never imagined that someone presented with real-time, detailed information wouldn't immediately grab it and use it to improve their business. I was so taken aback I could not think of an intelligent response, and needless to say, we didn't win that deal.

I'm not going to suggest that he was right, since "doing something with the data" was implicit in his job description, but there is a germ of wisdom for the IoT community in what he said:

Merely delivering data does not deliver value.

Even lots of accurate data, even in real time. Many IoT systems -- still -- have clearly been designed under the assumption that their responsibility ends at collecting, storing and presenting data: systems where data is collected and put in a data repository or historian; systems where data is collected an put on on-line graphs.

A real-world ACTION that benefits a group of stakeholders is still the only way that any IT system delivers value. For an IoT system to deliver that value, it must construct a chain from data to action. I suggest we call this chain:

The Information Value Chain.

The Information Value Chain is only just starting when you collect the data. Turning that data into information and ultimately into ACTION is harder, and if anything your "data only" Internet of Things (IoT) system has made the problem worse, not better: understanding a small amount of data to turn it into action is extremely taxing, and takes many different skills. Doing that with a torrent of data is overwhelming.

What is the Information Value Chain?

Very simply, the Information Value Chain is the insight that data only creates value if it goes through a series of steps, steps which eventually result in action back in the real world.

Like so:

If we focus primarily on collecting data, then we will create Data Lakes, which are impressive Information Technology constructs, but on their own are passive entities that deliver no inherent value to the organisation.

If we focus primarily on action, then we will make decisions based on inaccurate information and misleading data, resulting in the wrong action, wasted money and lost opportunity. A great example is this Case Study.

How to solve this conundrum? Before we get into the mechanics of building a robust Information Value Chain, the starting point is human, not technological.

To succeed you must start with the right goal

The starting point is this: What is the motivation for your project?

If it is to build an "IoT System," then I suggest that you are heading down the road to failure. An IoT System is a means, not an end, and has as many different embodiments as the word vehicle - Ferrari; Ford Focus; Mack truck; oil tanker.

Here is what you should be setting as your goal:

"To build a system that creates value in [this] way; by enabling [these] actions; using the best methods; with the minimal required human intervention; based on the best possible information; in as close to real time as possible."

There is a lot in this statement. Let's unpack it.

The central message of the Information Value Chain is to see our information systems as part of a sequence who's end result is action that delivers value.

  1. When I approach systems analysis for a Customer, the first thing I write on the right hand side of the whiteboard is a "$" sign.
  2. To the left I have the Customer help me develop an ROI model:
    • Before: X1 action by X2 participant creates X3 value at X4 cost;
    • After: Y1 action by Y2 participant creates Y3 value at Y4 cost.
  3. Then we step left again to describe the decisions that lead to those actions. Now we can write:
    • Who (or what!) will make those decisions; on
    • What timescale;
    • Based on what algorithm.
  4. Now we can ask what information they will need to make these decision and
    • How to extract this information from the data available.
  5. Then, and only then, do we know what data to collect; how to process it, how -- or whether -- to present it; and how much of it and how to store it.

We have found this approach moves IoT from a vague concept of something the Client thinks "maybe" they should do, but are not clear on how it will impact their business, to a compelling business tool with clear purpose and value. That what this is all about!

What do the links in The Information Value Chain mean?

The terms data, information and decision, as well as knowledge and intelligence get thrown around a lot, often interchangeably, yet these are distinct concepts. It is important to understand what we are talking about so that we can define and deliver each link in the chain successfully. Let's start from right to left, as we have just described in our systems analysis process so that we always keep our end goal in mind:

  • Action: something that results in a change in the real-world which has a $ measurable value to a key stakeholder;
  • Decision: a choice between possible Actions made according to a set of rules that maximize the value of the action taken;
  • Information: Data interpreted in a specific context to best support the Decisions the User needs to be able to make;
  • Data: individual facts collected from the Real World environment, as accurately and as timely as possible, not all of which will be relevant to the Decisions to be made;
  • Real World: The totality of systems, machines, people and environmental factors that can affect the right Action to take in any given circumstance.

How do we turn The Information Value Chain into practice?

The Information Value Chain is a great conceptual framework to think about how to get from Data to Value, but as IoT system architects, we are concerned with the practical question of how to deliver Value from Data. This is the purpose of the 5D IoT Architecture, which maps the links in The Information Value Chain to 4 specific architectural components, suggests core requirements for each of those components, and adds a 5th component to continuously improve the solution itself.

This paper is the development of a series on concepts in Big Data, IoT and systems architecture originally published on Fraysen Systems.

Read more…

Gartner recently released their 2017 Emerging Technologies Hype Cycle. Where do IoT Platforms stand? At the peak of inflated expectations!

Do you agree?

Gartner says that the hype cycle reveals three distinct megatrends that will enable businesses to survive and thrive in the digital economy over the next five to 10 years. (See graphic below).

Artificial intelligence (AI) everywhere, transparently immersive experiences and digital platforms are the trends that will provide unrivaled intelligence, create profoundly new experiences and offer platforms that allow organizations to connect with new business ecosystems.

The Emerging Technologies Hype Cycle is unique among most Gartner Hype Cycles because it garners insights from more than 2,000 technologies into a succinct set of compelling emerging technologies and trends. This Hype Cycle specifically focuses on the set of technologies that is showing promise in delivering a high degree of competitive advantage over the next five to 10 years.

"Enterprise architects who are focused on technology innovation must evaluate these high-level trends and the featured technologies, as well as the potential impact on their businesses," said Mike J. Walker, research director at Gartner. "In addition to the potential impact on businesses, these trends provide a significant opportunity for enterprise architecture leaders to help senior business and IT leaders respond to digital business opportunities and threats by creating signature-ready actionable and diagnostic deliverables that guide investment decisions."

Read more…

Among the words, phrases and acronyms in the Tech worlds “Platform” seems to be a word which seems to grab the headlines. If one listens to any pitch from a start up venture it would be not uncommon to get the “platform pitch”in at least 1 out of 2 proposals. A lazy search on Google on the “Top 20 Tech weary  words” fetched me the result that “platform was 3rd in the list . (https://www.businessinsider.com.au/the-worlds-top-20-tech-weary-words-for-2014-2014-5).

There have been words verbalised like “Being Platformed” as well and a host of books on the significance of platform in the Technology world. I will not go into the virtues of platform. I would dwell on how the leaders in respective segments  are a few ( a maximum of 3 ) while in the IoT world we seem to have by some counts 170 of them ( McKinsey ) to 400 of them ( Beecham Research).This is definitely a bewildering array to go through and investigate .

What is a Platform – why there are only a few platform leaders ?

Stepping back – different people have different views and meanings of the word “platform”. To get a view of the diversity of platforms we have:

Browsers (Chrome and Firefox) ,smart phone operating systems ( iOS and Android) , blogging  (Word Press , Medium ) .Social Media titans (YouTube, Facebook) and even Instagram are described as platforms. Uber, Airbnb and their ilk are widely described as ‘marketplaces’, ‘platforms’ or ‘marketplace-platforms.’ Web services (Google Payments, Amazon Elastic Cloud) and  gaming consoles (Xbox, Apple’s ipod Touch, Sony Playstation). One interesting point to be  noted that in each category the market is mostly duopolistic .

To accommodate this diversity the safest definition of platform would be as :

  1.  An extensible codebase of a software-based system that provides core functionality provided by the modules that interoperate with it, and the interfaces ( aka Application Programming Interface (APIs)) through which they interoperate. In effect this system  abstracts a number of common functions without bringing out the complexity of building and managing them ,  for the users .
  2.  The goal is to  enable interactions between producers and the consumers
  3. This is enabled through three layers comprising the Network ( to connect  participants to the platform), Technology Infrastructure ( to help create and exchange value )  and Workflow and Data ( thereby matching participants with content , goods and services ) .

This definition brings in the 2 dimensions of a platform. One that would be for internal use and the other for external use .

  1. An internal dimension  for building platforms is to ensure all necessary modules interoperate , and
  2. An external dimension for building platforms is to enable interaction with the outside world and make it as accessible and usable as is possible.

Internal dimension led platforms focus on internal productivity and efficiencies and focus on users. Here the development is internally sourced and is essentially  built for internal use .  The external dimension led platforms focus on the supply (developer side) and the demand (user side) . Essentially they are sometimes termed as “two-sided” platforms .The development beyond a point is crowd-sourced and they enrich the platform and the platform reaches out to them through APIs.

In most of the cases if the external dimension is well evolved then the internalities come with the efficiencies by default; with respect to design quality , selection of interfaces leading to interoperability  , robustness of infrastructure , seamlessness in workflow and data streaming  .

External dimension platforms compete for both users and developers

Here one important aspect to be remembered is a Platform may not be ready to provide solutions to contextual and domain specific problem statements. Applications built around the platform do that, these applications help get the Return on Investment ( RoI ) from the platforms .

In any segment you must have seen that the winners are a few ( atmost 2 or 3  , aspirants may be many, who progressively wither away )  .The reasons has been presented above with respect to design quality , interoperability, infrastructure robustness and seamlessness in workflow and data flow and the last but not the least excellent and friendly user interface . Not many can master all the 4 aspects .These help acquire a critical mass of customer base which keeps growing and a duopoly of sorts is created in the market space .

Successful platforms have the ability to support the variety of business use cases in the present and have strive to  build the  design to evolve over time and be to an extent future ready .

The Bazaar of IoT platforms- The reasons & who would be the winners  wading through the maze ?

Now when coming to Internet of Things (IoT)  , The IoT  movement repeatedly talks about platforms, but those definitions don’t align with any of Uber, Medium or Android. The first issue is interoperability.  And none of these align with each other either.

Now let us address the question is the why of “plethora of platforms” in IoT .

It can be seen clearly that a typical architecture of an IoT solution is multilayered. The layers to simplistically put would be Device to Device ( this involves hardware and firmware with Low Range Communication ) , Device to Server ( which would again involve hardware and communication ) and server to server ( which would mean that cloud based application and long range communication would hold the key along with network , data storage and data visualisation ) .

So we see protocols and standards are driven through their origins from communication technologies ( we see Telecom companies like AT&T and Verizon leading here ) , in the data storage area ( we have Amazon , Google leading the way ) , in the application side ( Azure from Microsoft and Thingworx from PTC being the prominent ones ) . Companies which has a library of business use cases with them given the dominance they have in their respective businesses (namely Bosch , GE , Honeywell ) have the ambition to build their community based platforms .Then we have a host of start ups who run a platform per a business use case they address .

So the genesis of the “plethora of platforms” in the multilayered solution stack of IoT . This adds to complexity and hence no one player can be a leader across the layers as on date .

In the coming  years it could be reckoned that there would be a shakeout in the market and the platforms could veer around key broad based use cases of remote monitoring and environment conditioning , predictive maintenance and process automation .

The ones which will win the battle of supremacy would have cracked the codes of

  1. Security,
  2. Open interfaces,
  3. Carrier grade reliability,
  4. Service levels,
  5. Scalability and
  6. And allow for aa seamless integration into the back-office environment which is essential to the enterprise’s business operations.
  7. With a impressive  usability and user interface .

Given the multitier architecture and the attendant complexity it will be a while before a small group of winners starts to bubble to the top . Some of the also-ran aspirants may focus on domains and address a  specific part of the ecosystem in which to play or in the industry segments like home or industrial to justify their presence .

 

 

Read more…

For all the value and disruptive potential that Internet of Things (IoT) solutions provide, corporate buyers face a dilemma. Today’s IoT technologies are still immature point solutions that address emerging use cases with evolving technology standards. Buyers are concerned that what they buy today may become functionally or technologically obsolete tomorrow. Faced with this dilemma, many defer buying even if the IoT solutions they buy today offer tremendous value to their organizations.

This post describes a planning strategy called “future-proofing” that helps managers, buyers, and planners deal with obsolescence.

What causes IoT solution obsolescence?

An IoT solution, whether you buy it now or in the future, can become functionally obsolete for several reasons, as described in Figure One.  Unlike more established technologies, today’s immature and fast evolving nature of IoT solutions, amplifies the risk of early obsolescence.

For example, today there are multiple Low Power Wide Area Network (LPWAN) connectivity options – SigFox, LoRa, RPMA (by Ingenu), Symphony Link (by Link Labs), NB-IoT and LTE-M. While each option has advantages and disadvantages, a subset of these will eventually “win” out as technology standards, business models and use cases emerge.

Similarly, there are 350+ IoT platforms in the marketplace today (source: “Current state of the 360+ platforms”, IoT Analytics, June 9, 2016). While many of these platforms target specific applications and industry segments, consolidation is inevitable as there are more vendors than the market can eventually support. The major IoT platform vendors (Amazon, Microsoft, Google, IBM, GE, et al), currently on a market share land grab, will drive consolidation when they begin to acquire select vertical platforms to gain rapid access to those markets.

What is Future-Proofing?

According to Collins English Dictionary (10th edition), “future-proof” is defined as:

“protected from consequences in the future, esp. pertaining to a technology that protect it from early obsolescence”

Because of the high cost of enterprise technologies, many buyers perceive obsolescence as bad. To them, future-proofing means keeping the technology as long as possible in order to minimize costs and maximize return on investment (ROI). Their companies have standardized their business processes, policies and even their technical support on the technologies that they have bought. When a solution goes End of Life (EOL) and transitions to a newer version, it means that managers will have to recertify and retrain everyone on the “new” solution all over again. In general, transitions happen over a period of months (and sometimes years) in large global companies. During this time, multiple generations of the solution will co-exist, with each requiring different processes and policies.

In today’s fast moving IoT market, planned and unplanned obsolescence will be the norm for the foreseeable future. The traditional concept of “future-proofing” doesn’t apply, and can lead to significant, adverse business disruption.

In the era of cloud based solutions and IoT, future-proofing is not about outguessing the future, and choosing the “right” solution so as to never have to “buy” again. Nor is it overbuying technology now to avoid buying in the future. Finally, future-proofing is not about avoiding change. Future-proofing is a solution lifecycle management strategy. It is a continuous process to maximize solution flexibility and options, while making deliberate choices and managing risk.

What does a future-proof IoT infrastructure look like?

In planning the future-proofed IoT infrastructure, managers must first understand its key characteristics, and then define specific requirements for each of those characteristics. At a high level, these characteristics include:

  • Usable– the infrastructure and solutions achieve all functional needs with no loss in performance, security, service level agreements (SLA) over the desired time period.

  • Scalable – supports future needs, applications, devices

  • Supportable – resolves technical, performance, reliability, SLA issues

  • Changeable – addresses “lock-in” and facilitates migration to updated solutions on your schedule based on your needs

  • Economical – the total cost of ownership of the solution stays within forecasted ranges

A framework for future-proofing your IoT infrastructure

Change is constant and cannot be avoided. The driving principle behind future-proofing is managing change, not avoiding or preventing it. This principle recognizes that every solution has a useful functional life, and that what is functionally useful today may be obsolete and discarded tomorrow.

A properly designed future-proof plan provides the organization with options and flexibility, rather than lock-in and risk. It prevents suboptimal decision-making by managing the infrastructure on a system level, rather than at the individual component level.

Future-proofing your IoT infrastructure is a three step process (Figure Two). It is not a “once and done” exercise but must be done annually to remain relevant.

Plan and Design

The first step of the future-proofing process is to identify and place the various IoT infrastructure, systems and solutions into one of nine actionable categories. These categories are shown in Figure Three. The horizontal rows represent the “change” category, while the vertical columns represent the timeframe decision timeframe.

The actual classification of the IoT infrastructure solutions into one of the categories is determined in conjunction with IT, operations and the business units. Key considerations for determining the “future-proof category” include:

  • Usability/functionality – functional utility, compliance with standards, performance against needs, SLAs, and performance

  • Scalability – ability to meet current and future needs, anticipated change in standards

  • Support – resources, expertise, reliability

  • Ease of transition –contractual agreements, technology interdependence/dependence, specialized skills

  • Economics – maintenance costs, licensing/content/subscription fees, utilities, new replacement costs, transition costs

Source and Build

Once the proper categorization is completed, the second step is to procure the necessary solutions, whether they are hardware or software. This requires that a sourcing strategy be put into place over the desired time period. The terms sourcing and buying are sometimes used interchangeably, but they are not the same. Sourcing is about ensuring strategic access to supply while buying is more transactional. In executing the future-proofing plan, procurement managers must understand the supplier product lifecycle, and develop specific tactics.

As an example, a large global company decides to standardize around a specific IoT edge device (and specific generation) and technology for the next five years. In order to maintain access to this supply during this time period, it employs a number of tactics, including:

  • Stocking of spare units to be deployed in the future

  • Placing large “Last time” orders before that version of the solution is discontinued

  • Sourcing refurbished versions of the technology

  • Incorporating leasing as sourcing strategy

  • Negotiating contractual arrangements with the vendor to continue the solution line

Support and Monitor

The third step in the future-proofing strategy is to keep the IoT infrastructure and solutions operational over the desired time period. This is relatively easy when the solutions and technologies are being serviced and supported by the vendors. However, as vendors transition to newer technology and solution versions, buyers may find limited support and expertise. This problem is amplified the further you are from the original end-of-life date.

To keep the infrastructure and solutions fully operational during this time, companies must employ various reactive and proactive tactics. Some of these include:

  • Incorporating and installing vendor firmware updates to maximize functionality, apply bug fixes and extend useful life. Vendors may issue firmware updates on both End of Life and current generation solutions.

  • Purchase warranty and extended warranty and maintenance service contracts to assure access to support

  • Develop in-house maintenance and repair capability

  • Negotiate special one-off engineering support services with the vendor or their designated contractors

About:

Benson Chan is an innovation catalyst at Strategy of Things, helping companies transform the Internet of Things into the Innovation of Things through its innovation laboratory, research analyst, consulting and acceleration (execution) services. He has over 25 years of scaling innovative businesses and bringing innovations to market for Fortune 500 and start-up companies. Benson shares his deep experiences in strategy, business development, marketing, product management, engineering and operations management to help IoTCentral readers address strategic and practical IoT issues.

Read more…

By 

Rapid Growth in Times of Uncertainty

The industrial Internet of Things (IoT) is enabling and accelerating the convergence of three key technology and business model shifts that are fueling the digital transformation of every industrial enterprise:

  • Connectivity. The number of connected devices and mobile devices is growing at an increasingly faster pace, emanating massive amounts of real-time information that enables deep insight about themselves and the environment around them.
  • Cloud Computing. After years of hesitation, cloud technology is finally becoming a mainstream business platform and a growth engine. New information systems and business operation constructs can be deployed and scale quickly and cost effectively, as connected assets and mobile devices deliver decision-making power to all ranks in the organization.
  • New Business Models. Cloud-connected assets and customers, coupled with real-time information and decision-making capabilities form the foundation for new ways to engage the business and its customers. Businesses can deploy innovative customer-centric outcome-based engagement models and respond to changing market conditions with greater agility and flexibility.

Industry is making strides in developing Internet of Things technologies and articulating the potential business value of industrial IoT and Industry 4.0 solutions. The upcoming years of the IoT evolution will be characterized by rapid technology acceleration, as the vision of an always-connected world, in which everything and everybody is connected, is becoming an everyday reality.

And company leadership is under pressure to seize the opportunity. Eager technology vendors, enthusiastic investors and analysts, and deluge of breathless headlines, all entice corporate management to jump on the IoT bandwagon before it’s too late.

However, as technology forecaster Paul Saffo aptly observed, one should not mistake a clear view for a short distance.

Early rosy projections about growth in the number of connected devices and the economic impact of the industrial Internet of Things are proving overly optimistic, particularly about the ability of industrial companies to pursue the vision effectively. A survey by the Boston Consulting Group found that while US companies consider digital technologies critical, many lack a holistic adoption strategy and a sense of urgency. A report by KPMG reaches a similar conclusion, highlighting a growing gap between executive ambitions and the corresponding transformative action plans.

To a great extent, the excitement and promise of growth are tempered by lingering concerns about IoT network security and data privacy. Others are still uncertain how to go about articulating comprehensive business models and return on investment.

What Does the Industrial IoT Mean for Product Designers?

What does the industrial Internet of Things mean for the designers of connected products that enable new customer engagement models? Are IoT “things” just like any other industrial equipment, only connected to the Internet? or are there certain design and technical elements business planners and design engineers should consider?

To understand the relationships between the Internet of Things and product design, we need to consider three layers of responses:

Design for IoT

At its most fundamental level, designing products for IoT concentrates on incorporating basic telemetry features such as sensor electronics and Internet connectivity, and, rather obviously, the necessary mechanisms to secure these devices from rogue access and malicious hacking.

Design for the Business of IoT

A less obvious observation, often missed by IoT enthusiasts, is that the product architecture and features must be aligned with business operations. Designers should adopt a business-centric point of view and optimize features and capabilities specifically to achieve the intended business outcome.

For instance, a design to maximize system uptime requires not only remote monitoring capabilities, but could also include optimizing replaceable unit (FRU) granularity to streamline field service operations, spare parts inventory, and workforce availability and training.

Design by IoT

But there is much more to the question about the relationship between the Internet and the “things.”

Most engineering organizations lose sight of their products once they are sold or installed in the field. Always-connected products and customers provide a nonstop stream of structured and unstructured information about products, services, and user interactions. This rich feedback from diverse connected ecosystems, including social media, enable faster and precise design iterations and effective continuous improvement. In essence, the IoT is driving product design!

Seven Industrial IoT Predictions for 2017 and Beyond


Continue reading at JoeBarkai.com

Read more…
This is my second analyst perspective based on our IoT Benchmark Research. In the first, I discussed the business focus of IoT applications and some of the challenges organizations are facing. In this post I’ll share some of the findings about technologies used in IoT applications and the impact those technologies appear to have on the success of users’ projects.
Read more…

With its growing prevalence, the Internet of Things is ushering in a new form of ecommerce – the Commerce of Things, where everyday objects are internet connected and capable of initiating a series of purchases on their own. This new way of buying and selling online is radically changing traditional ecommerce rules and creating a new set of challenges for companies. In this new world of commerce, the product sale is no longer just a transaction; it’s the beginning of an ongoing relationship between brands and customers. Successful online brands are focused on nurturing this relationship – and taking deliberate steps to turn transactional customers into loyal members. 

There is a subtle but critical difference between a repeat customer and a member. Understanding this difference is the key to succeeding in an environment that is swiftly becoming a hyper-connected network of consumers who value the access and amenities that come with membership.

How do you build these relationships?

1.)   Create lasting relationships to make members out of customers. Members share the experience and the story of the brand, rather than just execute a basic business transaction or product purchase. For years, Disney, where everything is a show and employees are cast members, has stood by the adage “Be Our Guest,” calling to their customers in a more intimate, personable way. Cable companies refer to their customers as “subscribers;” LinkedIn has always called users “members.”

To move customers from “transaction to membership” on a relationship continuum, companies must provide extra, incremental value that replaces pure monetary benefits with more intangible rewards of being, in Disney’s case, a guest.

2.)   Use data and metrics to strengthen relationships. Once a company starts to grow its base of members, a whole new set of metrics becomes the benchmark for evaluating the customer relationship.

Asking one simple question, “What is a subscriber’s actual usage?” can yield revelations regarding whether someone is a transactional customer or an invested member. For example, January is the peak season for signing new members at fitness centers around the country. Are those who sign up then really members? If they are not actually getting personal value out of their membership, then the relationship remains transactional and fleeting at best.

Good data is powerful. If the data shows customers are not acting like members, then a company can follow up to discern the true nature of the relationship and figure out how it can become more valuable to the customer. This creates a win for both the customer and the company. 

Delta Airlines’ SkyMiles program, for example, makes great use of data to cut through barriers that could otherwise prevent strong relationships from developing. When members call in, the automated phone system quickly recognizes callers based on their phone numbers, addresses them by name and asks about recent or upcoming trips.

Personalizing interactions, continually making improvements and utilizing customer insights are key in this new, Commerce of Things world. Taking these steps can help transform transactional customers into loyal members – and take an online business to the next level.

Read more…
Since many embedded devices are deployed outside of the standard enterprise security perimeter, it is critical that security be included in the device itself. Ultimately, some combination of hardware and software may be required. Building protection into the device itself provides a critical security layer whatever options are used. Security must be considered early in the design of a new device or system.
Read more…

There is an ongoing transition from a world where having an internet connection was sufficient, to a world where ubiquitous connectivity is quickly becoming the norm. The ability to gather and transport data at high speeds from anywhere is leading to increased automation, smart-everything (vehicles, homes, appliances – you name it), and a standardization of languages and protocols that make the possibilities nearly endless.

Recently, IEEE and Eclipse Foundation completed surveys that provided a snapshot on tools, platforms and solutions being used by engineers and programmers alike to build the Internet of Things. According to Joe McKendrick for RTInsights.com, there were several notable conclusions to be drawn from the results, including the revelation that, of the 713 tech professionals surveyed, nearly 42 percent said their companies currently deploy an IoT solution, and 32 percent said they will be deploying/working with an IoT solution over the next 18 months. Additionally, RT Insights writes:

“In terms of areas of concentration, 42% report they are working with IoT-ready middleware, while 41% are concentrating on home automation solutions. Another 36% are working with industrial automation as part of their IoT efforts. One-third are working on IoT for smart cities, and the same number are building smart energy solutions.”

An interesting note from those conclusions is that 36 percent are working with industrial automation as part of their IoT efforts. Earlier this year, we predicted that Industrial IoT (IIoT) app development would outpace consumer IoT apps, and although this sample size is somewhat limited, it still bodes well for the development of the IIoT sector that is just starting to come into its own.

Among IoT developers, there has been a bit of debate over the programming languages that best suit IoT apps. There are situationally appropriate uses for the main languages, but currently, the majority of developers prefer Java and the C language. For developers, being able to build out IoT apps that can work across platforms is a giant step toward standardization. Specifically, in the Industrial IoT, being able to build apps that can function at the Edge to enable smart data collection is a becoming an unofficial mandate for any companies hoping to transition legacy OT operations into the IT/OT convergence movement taking place across critical industries.

Of course, building apps is a meaningless task if the hardware being deployed can’t host those apps, a finding that was demonstrated by the survey:

Hardware associated with IoT implementations include sensors, used at 87% of sites, along with actuators (51%), gateways and hub devices (50%), and edge node devices (36%).

This Edge functionality and sensor deployment are two pieces that are driving the adaption of IoT technology across industries that have traditionally relied on data as the main tool for decision making. However, with smarter hardware, these industries now have the opportunity to improve the efficiency of that decision making – a transformative capability in the industrial realm.

Join FreeWave’s ZumLink IPR Pilot Program!

IIoT App Development with Java, Python and C++ languagesWhat if you could…..

  • Collect, analyze and react to data in real-time at the sensor edge?
  • Reduce BIG DATA that clogs data pipelines?
  • Minimize the cost of expensive PLCs?
  • Control your sensor at the closest touchpoint?

The ZumLink IPR App Server Radio combines 900 MHz wireless telemetry with the ability to program and host 3rd party Apps for intelligent control and automation of remote sensors and devices. To participate in the pilot program, visit: http://www.freewave.com/zumlink-ipr-pilot-program/.

Pilot Program participants:

  • Receive a complimentary hardware/software Dev Kit
  • Get support from FreeWave software engineers
  • Should have App developer’s skills

Let’s discuss:

  • Use cases that would help you or your organization solve a problem
  • Problems you would like to solve
  • Developers that could build this App
Read more…

Sounds similar to jargons from the movie ‘Back to Future (1985)?

Hold yourself together. A part of the world has already started using it.

If you have a light memory turning off switches or managing home appliances, these IoT technologies are going to be your guardian angels.

Let’s find how the above ‘jargons’ will become a part of your life. Also, for the geek in you, their modus operandi is also described.

#1 Adaptive Lighting

IoT can make your home lighting system smart enough to adjust its brightness or to switch off automatically by sensing its surroundings. With IoT adaptive lighting your, indoor lighting systems will turn themselves off when there is no one in the house, or adjust the brightness according to external lighting conditions to give minimized energy consumption.

Companies like LG are taking it to forward to manufacture lighting systems that will turn on by default along with alarm clocks or to flicker when there is a telephone call or movement is sensed. Adaptive lighting relies on motion sensors and optical sensors to gather metrics about its immediate surroundings based on which the lighting systems function.

#2 Responsive Thermostats

Thermostats that auto adjust the temperature and power consumption according to external climatic conditions is a boon for any household. Smarter thermostats can learn the usage pattern of family members and alter its functions accordingly. Going a step ahead, these responsive thermostats can even connect to the Internet to receive updates about family members and change the power consumption and internal temperature control.

For instance, if you are away from your home for a very long time, the thermostat will reduce the power consumption to a bare minimum, or send alerts when the equipment malfunctions. Amazon Nest is a classic example of responsive thermostats. They use heat and climate sensors to decide at what optimum temperature the thermostat must run for best performance.

#3 Autonomous Security Systems

IoT will foster a breed of homes and offices where physical keys, access cards or even tokens will never be needed. Sensor based security systems can be programmed for allowing entry, locking or alerts in case of a break in. Advanced IoT applications also allow integrate your home security system for communicating with your smartphones. These autonomous security systems will work based on movement sensors or proximity sensors.

#4 Connected Appliances

How many times have you missed turning off the oven? Or the washing machine? Or the coffee machine and the endless list of other home appliances? With the oncoming wave of IoT, connected appliances will empower homeowners to control their entire suite of home appliances using their smartphone or remote controls.

Two of the classic examples of connected appliances are: Smarter’s WiFi coffee machine that brews fresh coffee even when you are lazing around or the Electrolux CombiSteam Oven that can be controlled anywhere using your smartphone.

#5 Surface Remote Controls

Surface remote controls can turn any surface (like a desk, wall, floor, etc.) into a remote control. Surface remote controls allow users to control several domestic settings like lighting, control connected appliances, open/close doors, switch on/off TV, wifi, music system, etc.

Image source: knocki

These devices are equipped with programmed sensors which can communicate with other IoT devices to do desired actions. Surface remote controls can bring about a revolutionary level of comfort not just in homes, but also offices, factory floors and public spaces. Knocki is one such device that can turn any surface into a remote control.

That brings us to the conclusion. Be informed that this is just a tip of the iceberg. IoT is an ocean of opportunities and these five hints at how homes of the future will look and function like.

Contus, the digital transformations company is creating a whole new breed of IoT connected systems under its ambit of services titled Contus Connect.

Read more…

What are common features of IIoT and SCADA/HMI and differences between them? And what advantages do Internet of Things Platforms have over SCADA systems? Find out answers in our new presentation.

Read more…

IoT and Energy Management

It’s not uncommon to drive about any major city at night and see many buildings illuminated despite the fact that the workers went home hours earlier. Likewise, manufacturing plants the world over often have equipment unnecessarily consuming energy during idle periods. Power plants create and store energy everyday and use energy distribution grids to distribute energy to users, but are they doing it “smartly?”

With rising concerns about global warming, this immense waste of energy undoubtedly hurts the environment, but it also hurts business. Offices, manufacturing plants, commercial spaces and power grids all stand to benefit financially from better and “smarter” energy management.

 

How IoT Reduces Energy Usage for Businesses and Manufacturing

In his article, “Report: Lofty Energy Management Goals Far Ahead of Reality,” (Panoramic Power, August 5, 2015) Jon Rabinowitz points out that most companies receive data on their energy usage only at the end of each billing cycle, which is usually a month at a time. By incorporating Internet of Things (IoT) technology, energy consumption data will be available in real-time, and energy-reducing measures can be implemented as soon as a problem gets detected (rather than waiting until the end of the month). Integrating smart devices through IoT technology will provide greater visibility into energy usage and help both industrial and commercial enterprises save energy, and as a result, save money.

Starting with simple, smart and low cost sensors, like User to User Information (UUI) and Feature Driven Development (FDD) devices, businesses can reduce energy usage and cost by dimming lights, turning off unnecessary equipment and improving the use the cooling/heating apparatus. Software that collects and correlates granular usage data, performs analytics and then converges information to increase efficiency will make manufacturing plants “smarter,” and thus more cost-effective.

Local and remote sensors that detect points of inefficiency quickly and perform triage to decrease waste will also reduce the need for maintenance as constant monitoring will detect small issues before they become big problems. Continuous optimization through 24/7 monitoring will assure that energy is not wasted during slow periods in between high-usage spans, while maximizing the use of energy-demanding equipment at critical times.

Specific Use Cases – Energy Production and Management

  • General Electric’s Asset Performance Management software connects disparate data sources in power plants, enabling data analytics to guide energy usage and to increase efficiency (“10 Real-Life Examples of IoT Powering the Future of Energy,” Internet of Business, Freddie Roberts, Oct. 7, 2016).

  • Duke Energy, a Florida-based electric power holding company, has developed a self-healing grid that automatically reconfigures itself when power goes out. Using digital smart sensors at sub stations and on power lines, the system automatically detects, isolates and reroutes power in the most efficient way when problems occur (Roberts).

  • Pacific Gas & Electric Company is testing drones as a means to monitor and evaluate electric infrastructure systems in hard-to-reach areas. The ease of access will allow more frequent and consistent monitoring and drastically reduce the amount of methane leaks and other unwanted disruptions. (Roberts).

 

Energy Saving in the Auto Sector

Nissan (manufacturer of the world’s best-selling electric car, the Leaf) and ENEL (Europe’s second largest power company) have teamed to develop an innovative vehicle-to-grid (V2G) system that creates mobile energy hubs, which also integrates the electric cars and the power grid. The system allows Leaf owners to charge at low-demand, cheap-tariff periods, while allowing owners to use the energy stored in the car’s battery to power their home during peak periods, or when power goes out. Owners can store excess energy, or return it to the grid, making the entire system more efficient for everyone (“Nissan and ENEL to test first Grid Integrated Vehicles in Denmark,” Copenhagen Capacity, December 11, 2015).

 

Conclusions

As evidenced by these specific use cases, IoT technology is making energy-intensive systems in power generation and in manufacturing far more efficient. It’s good for the environment, but it’s also good for business. Intelligent implementation of energy saving technology stands to benefit every business, from small commercial enterprises to the largest power producing utility companies in the world. It’s time to make the move to smarter energy usage, for both the environment and for your bottom line.

 

Originally published on the Unified Inbox blog

About the Author

Richard Meyers is a former high school teacher in the SF Bay Area who has studied business and technology at Stanford and UC-Berkeley. He has a single-digit handicap in golf and is passionate about cooking, wine and rock-n-roll.

Read more…
The IoT needs to be distinguished from the Internet. The Internet, of course, represents a globally connected number of network, irrespective of a wired or wireless interconnection. IoT, on the other hand, specifically draws your attention to the ability of a ‘device’ to be tracked or identified within an IP structure according to the original supposition.
Read more…
The rise of the Internet of Things was just the beginning. There is something much bigger brewing. It’s called the Internet of Everything — otherwise known as IoE. Instead of the communications between electric-powered, internet-connected devices that the IoT allows, the IoE expands it exponentially. The IoE extends well beyond traditional IoT boundaries to include the countless everyday, disposable items in the world. If the IoT is the solar system, then the IoE is every galaxy in the universe.
Read more…

From the Kepware blog:

In today's fast-paced world of technology, new software can reshape industries overnight. But while the Industrial Internet of Things (IIoT) is everywhere now—connecting millions of devices, machines, sensors, and systems throughout the world—it is anything but an overnight sensation. Over the past 50 years, technological milestones big and small—from large-scale system architecture breakthroughs to modest "Eureka" moments—have led to today's IIoT and are still informing predictions for tomorrow's industrial landscape.

Read more here.

Read more…

The world is full of normal people like you and me, but I love to think that superheroes live between us and I dream that maybe someday I could become one of them and make a better world with my super powers.

In the universe of superheroes fit gods, mutants, humans with special skills, but also the special agents. I found fun to find similarities between this fantastic world and the world of IoT platforms.  Compare and find a reasonable resemblance between IoT Platforms and Superheroes or Super villains is the goal of this article. Opinions as always are personal and subject to all kinds of comments and appreciations. Enjoy, the article.

About IoT Platforms

Many of my regular readers remember my article “It is an IoT Platform, stupid !.”. At that time, per Research and Markets, there were more than 260 IoT platforms, today some sources speak about 700 IoT platforms. I confess, I have not been able to follow the birth, evolution and in some cases death of all IoT platforms out there. I think that many enthusiasts like me also have given up keeping an updated list.

I cannot predict which IoT platforms will survive beyond 2020, or which will be the lucky start-ups that will be bought by big companies or will receive the investors' mana to become a Unicorn, but I like to speculate, and of course, I have my favourite winners and unlucky losers.

About my Own Methodology

Some reputed analysts have adapted their classification methodologies of IT solutions to put some order and consistency into the chaotic and confusing Internet of Things (IoT) platforms market. But given the moment of business excitement around the IoT, have appeared new analyst firms focused on IoT who also wanted to contribute their bit and at the same time make cash while this unsustainable situation lasts.

After reading numerous reports from various sources on this topic, talking to many IoT platform vendors and seeing endless product demos, I have decided to create my own methodology that includes a questionnaire of near 100 questions around different areas: technical, functional, business, strategy, and a scoring mechanism based on my knowledge and experience to make justified recommendations to my clients.

About Super Powers Methodology

But I also had defined an alternative Methodology based on Super Powers.

Super Heroes and Super Villains usually gain their abilities through several different sources, however these sources can be divided into four categories. The Super Powers methodology is based on these four categories of Power Sources.

  • Mind Powers – Powers with notable mental abilities. Companies like IBM Watson IoI or GE Predix are notable examples.
  • Body Powers – Powers that are gained from genetic mutation. Companies like Microsoft or Amazon mutate to IaaS / PaaS IoT platforms.
  • Spirit Powers  Powers gained over time through extensive investment, and are easily obtainable by companies without the risk of horrible mutation or disfigurement. PTC Thingworx, Software AG/Cumulocity or Cisco-Jasper are examples.
  • Artefact Powers   Powers gained abilities through ancient objects such as networks, or hardware. Incumbent Telcos M2M Platforms, Telco vendors like Huawei, Nokia or Ericsson, and Hardware vendors like Intel IoT platform, ARM Beetle or Samsung Artik are examples.

For each Power Source category, Super Powers are divided into different levels of power that depend on how strong, or unique, their abilities are.

  • Level 0 -  with useless, or minimal abilities.
  • Level 1 -  they are still particularly weak compared to the higher levels.
  • Level 2 -  have developed their powers to a certain point. About 75% of the platforms belong to this class,
  • Level 3 - Mostly are most commonly amateur heroes or sly villains.
  • Level 4 - Some of the most unique with a wider variety of powers.
  • Level 5 - these fellows are seasoned veterans of their abilities, capable of using them without even needing to concentrate.
  • Level 6 - Only a few beings are classified under this level, and their powers are that of being able to control multiple aspects of IoT reality.

Whatever the source of power was, I add Sandy Carter´s recommendation: If you want to become an Extreme Innovator you also need Super Intelligence, Super Speed and Super Synergy.  

About Super Heroes and Super Villains

Previously in “Internet of Things: Angels & Demons” and “Internet of Things – Kings and Servants” , I identified some IoT Platform companies as potential superheroes. What was certain is that we knew who the supervillains were. Governments, organizations and business giants that try to control us, manipulate us and frighten us with their economic, political and military powers.

Deciding which superhero can help you more or what superpower is more important for your business is an extremely important milestone in your IoT Strategy.

I've defined the six types/categories of superheroes / IoT Platforms:

a)The superhero whose power is a birthright like Amazon AWS IoT (Superman) or GE Predix (Magneto/Professor Xavier).

b)The superhero whose power is the result of power acquisitions like PTC Thingworx (The Flash) or Cisco Jasper-Parstream (Spiderman) or Autodesk Fusion Connect (FireStorm).

c)The superhero whose power is made possible by technology like Oracle IoT (Iron Man) or SAP Leonardo(Green Lantern). 

d)There is the superhero who doesn't have any superpowers but who is a superhero by extremely intensive training like Batman (Ayla Networks) or Black Widow (Exosite) or LogMeIn-Xively (Hawkeye)

e)The superhero who obtains his/her powers due to some supernatural event like Satya Nadella named new CEO for MSFT IoT Azure (Thor) or Telit DeviceWise (Dr. Manhattan) or Google acquisition of Nest (Hulk)

f)Finally, there is the superhero, usually a sentient android, who was created by a human like IBM Watson IoT (Vision) or a normal human playing with magic like Salesforce IoT Cloud Einstein (Dr Strange) or leader of a young team like Hitachi Data System(Most Excellent Superbat)

“Do you agree with my classification system for superheroes and superpowers?”

Although the number of superheroes and supervillains is enormous (more that the IoT Platforms Universe), it would take me a long time to assign each one of the IoT platform a single superhero or supervillain. Since I do not think many companies are willing to pay to know who represents them better, at least I have done a partial and fun exercise.

The Bottom Line 

If you are an IoT Platform vendor, you could be doing yourself some questions right now:

-          If I could be a Superhero what would it be?".

-          Worth to acquire a Super Power or reach an upper level to convince customers I am their Superhero?

And remember …

“With power comes responsibility; with great power comes great responsibility”

Although the number of superheroes and supervillains is enormous (more than the IoT Platforms Universe), it would take me a long time to assign each one of the IoT platform a single superhero or supervillain. Since I do not think many companies are willing to pay to know who represents them better, at least I have done a partial and fun exercise.

Thanks for your Likes and Shares.

Read more…

From “smart” hairbrushes to lawn mowers, the Internet of Things (IoT) has created a slew of slick products, but there have also been many failures: too many connected devices have gone by the wayside, and in most cases, this is preventable. This scenario, recognized as the Abandonment of Things, is the land where connected devices go to die. Several factors drive the Abandonment of Things: a lack of a proper monetization strategy for connected services; failure to create a community around a smart device; even security issues and clunky backend processes. If a company wants to avoid the digital scrap pile, and subsequent loss of potential revenue and customer gains, it must have all the right parts working in sync.

Keeping an Eye on Profitability

Companies are always looking to expand their user bases, but as that base grows, so do infrastructure costs. Think increased server capacity and the people needed to manage the technology aspect of a subscription service. If the right infrastructure is not in place, profitability takes a hit.   

It comes down to data collection and value. What data do companies collect and how do they use it? Where is the value? Take some of the popular connected health bands for example: their freemium models allow consumers to track food and exercise and then compare and compete with friends. On the other hand, their premium models cost around $100 annually and give consumers the option to compare themselves with strangers who are just like them.

Does the data revealed by the premium model — data about strangers rather than friends — provide enough value to convert 3-5 percent of the consumer base into paying customers? That’s the question the marketer must ask and answer.

Getting in the Consumer’s Head

With traditional, non-connected devices, the relationship between brands and consumers ends with the purchase. But with a smart device, the purchase is the beginning of that relationship. IoT is actually not about the thing — it’s about the service as well as the value provided by the service. A company must therefore consider more than the transaction, or the value of the product, or even the initial needs of the consumer. Companies must understand the value a consumer — or better yet, a member — gets from the service. An integral part of that value is the community consumers join when they subscribe to a service.

The new subscription generation requires companies to think of their consumer base as a membership base, which requires very different communication strategies. Transparency is key, both in terms of the solution offered and the financial aspect of the solution. Companies start to achieve success when they build out these relationships and consumers begin to take in new information, not just as marketing, but as an added value.

Awareness of Regulations

Security is paramount in the era of IoT. Striking the balance between value for consumers and protection of their data will be an ongoing challenge for marketers. One example that showcases the delicacy required in this new order is TVs that watch us — noting not just what you’re viewing, but who is in the room when the device is on. Even for those consumers who see great value in, for example, targeted commercials and programming, real questions revolve around how that data is collected and what companies do with it.

Consumer rights also change with every border crossing. Uber transactions are seamless in the U.S., but are more complicated in India. It’s not just about securing data, but also securing the complex payment processes inherent in a subscription-based, hyper-connected global economy.

How companies adapt to the regulatory environment is key to their success. One important thing to understand is that government is not necessarily proactive about regulating IoT — regulations will most likely come after some company is caught misusing data. One bad apple can affect an entire industry, so companies need to be transparent and meticulous about data collection and how data is used to create value.

Avoiding the Abandonment of Things

The new world ushered in by IoT is just dawning, and already the path forward is littered with abandoned things. A subscription-based economy demands flexibility, convenience and value. But those aren’t the only challenges your company faces when forging ahead. The right balance between monetization, transparent communications and security can create the environment your product needs to thrive.

Photo Credit: Becky

Read more…
RSS
Email me when there are new items in this category –

Upcoming IoT Events

More IoT News

IoT Career Opportunities