How Service Providers Can Become Leaders in the Internet of Everything

Over 50 billion “things” or devices are projected to be connected to the Internet through wired and wireless networks, generating zettabytes of data, all powered by cloud computing.  This Internet of Everything (IoE) will fundamentally transform businesses, generate enormous economic wealth and create immeasurable social value.    

We are discovering that successful IoE implementations require a solid technical and business platform into which different vertical solutions can be easily plugged to efficiently and effectively achieve the promised business, economic and social benefits.  The cornerstone of this IoE platform includes a robust connectivity and technology infrastructure, operational and management services, to accommodate a range of vertical and horizontal solutions.  Details of this IoE platform are outlined in Buildingthe Platform for the Internet of Everything.

The ideal IoE platform leverages common requirements across all vertical solutions to create a scalable, “build once – deploy many”, technical and business architecture. But, who is going to build and deliverable this scalable platform? 

I believe that service providers are well positioned to lead the development and implementation of the IoE platform.  Not only do they have years of experience building and running networks, operations and customer services, but many SPs now offer extensive cloud  and systems integration services.  Not to mention, their strong brands, vertical sales and solutions and a history of complex technical implementations. 

Service providers need to consider their strategic options for developing and operating the IoE platform.  Although it varies by provider, the strategic options build from an inherent, more technical, strength for SPs at the bottom of the platform, to less core capabilities in the services and management layers at the top.  A SP’s strategic options are:

1.    Core – Network Connection – extension of the core networking business.

2.    Closely Aligned – Network Access, Technology Platform – leveraging capabilities in deploying and operating network access and cloud services.

3.    Stretch – Vertical and Horizontal Solutions, Shared Operations Platform – likely partnering/acquiring to create IoE solutions; extending internal NOC and customer care operations as a service.

4.    New Areas – Professional Services, Program Management – while some SPs have some SI capabilities most will need to partner or organically grow consulting and services capabilities.

5.    Monetization – extension and growth of existing capabilities in advertising and data analytics to create vertical-specific monetization opportunities.

Our detailed analysis of the revenue potential for providing an IoE platform for Smart Cities (SmartCities Are a $7.5 Billion Annual Opportunity for Technology Providers) provides a good example of the value that can be created by providing the technical and operational requirements for successful IoE deployments.  Roughly one-half of the platform revenues come from the core or closely aligned areas – areas not very distant from a service provider’s current business.

We are starting to see SPs around the world chasing the significant IoE platform opportunity.  However, they are typically focused on their core business of providing network connectivity.  The big opportunity exists to move up the IoE platform stack to build and deliver new sources of value.  Service providers should start by expanding beyond connectivity to the closely aligned areas of network access and technology platform.  From there explore stretch and new areas by building off existing capabilities, seeking partners or considering select acquisitions.  In parallel, investigate areas where you can create new monetization opportunities in select verticals leveraging existing and new business capabilities.

Building and delivering a scalable IoE platform that can be deployed across multiple vertical solutions provides a compelling business case for SPs to capture a significant portion of the $20 trillion that IDC estimates will be spent over the next three years to realize the promise of the Internet of Everything. 

Service providers are well placed to take a leadership role as the providers of the IoE platform.  But, they better act fast.  Technology vendors, services companies, start-ups and niche players are all circling the waters to see how they can grab a piece of this tantalizing $20 trillion business.

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Building the Platform for the Internet of Everything

We are embarking on a new technological journey that will fundamentally change forever the economy, society and the way that we live.  Wired magazine described a new era where “the most mundane items in our lives can talk wirelessly among themselves, performing tasks on command, giving us data we’ve never had before.”  The Internet of Everything (IoE) is a world where up to 50 billion things (or devices) will be connected to the Internet by 2020; or, the equivalent of 6 devices for every person on the planet.

Businesses are beginning to completely re-design their processes, operations and business models to benefit from this new era.  We are already starting to see the emergence of smart cities, connected utilities, connected railways, connected factories, connected cars, and even connected mines, to name but a few.  All industries are looking to IoE as a breakthrough technology to help them optimize their business, enter new markets and enhance their relationship with their customers.  This is why industry analysts, like IDC, estimate that businesses will spend up to $20 trillion over the next three years to realize the promise of the Internet of Everything. 

But, The Internet of Things is More Than Just “Things”.  As I described in this recent article, the Internet of Things is really a short-hand for the four technology pillars (mobility, cloud, big data and things), wrapped in security, that are forging a revolutionary new, and revolutionary, connected world.  Successful IoE implementations don’t happen in isolation or independently.  We are discovering that successful implementations require a technical and business platform into which different solutions can be easily plugged to efficiently and effectively achieve the promised business benefits.  The cornerstones of this IoE platform include a robust connectivity and technology infrastructure, operational and management services and a range of vertical and horizontal solutions. 

In our experience, all IoE implementations require all of these technical and business elements to be successful.  Our vision is that effective IoE deployments will build an IoE platform that can be extended across the business, or even entire industries, to deliver a range of unique, value-added IoE solutions.

Starting from the bottom, the layers comprise:

 

1.    Network Connection – connecting all of the solutions, data and applications through fiber backhaul or licensed cellular.

2.    Network Access – a managed Wi-Fi, or other unlicensed wireless network, to connect all of the sensors and applications.

3.    Technology Platform – a platform to allow new devices and solutions to readily and securely “plug and play” into the overall architecture, and to connect to cloud storage and compute services.

4.    Vertical and Horizontal Solutions – the combination of devices and applications that deliver the unique solutions for different vertical and horizontal industry segments/.

5.    Platform Monetization – in some verticals, like smart cities and B2C, opportunities exist to leverage the platform and network to create new sources of revenue.

6.    Shared Operating Platform – a shared platform to consolidate the management, customer care and service issues across all of the solutions.

7.    Professional Services – services to support areas such as systems integration, planning and design.

8.    Program Leadership – services to program manage the entire implementation, operations and partner ecosystem. 

Successfully deploying and capturing the tremendous potential benefits of IoE is not just about cool things and applications.  A comprehensive technical, operations and management IoE platform is required to turn vision and promise into reality. 

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