Profiting from IoT – Look to your partners for success

By Zenobia Hegde

The Internet of Things (IoT) as a new business offering has opened the door for the service provider community to embrace the upsides new innovative consumer and enterprise service opportunities. However, let’s face the honest truth … are service providers actually providing any true value on top of the connectivity? For most, says Paul Hughes, director of Strategy at Netcracker Technology, the answer is currently no.

Connectivity is certainly an essential part of IoT, but the value chain extends well beyond just a simple binary on and off action of a sensor or the data collection and management of a smart city. With millions of customers already consuming traditional voice, video and data services, service providers have always been uniquely positioned in the ecosystem due to their existing customer relationships, expertise in providing end-to-end services to meet customers’ ever-changing needs and having all the necessary infrastructure to enable, orchestrate, provision, delivery and bill for services.

One of the biggest challenges to date for IoT is the creation of an effective business model that ensures that IoT services are in fact revenue generating services. Take a close look at smart cities, connected cars, e-Health services and other “cool and sexy” service areas and one things stands out … each vertically oriented service area is complex enough it itself that the service provider community likely will not have the resources, nor the domain expertise to support the complexities of each area.

Usage behaviour

Each IoT market will have unique characteristics around usage behaviour, service value, service evolution and roadmap, and long term market impacts. Thus, the traditional B2B and B2C models for IoT must be expanded to include a dedicated service centric partner that can provide management and expertise to ensure the services are effective.

Thus, the partner centric B2B2X model for IoT represents a more optimal fit because:

It ensures domain expertise at the heart of the most complex areas of service management
Partners with vertical IoT domain expertise will likely be much more nimble, can take on a distributed and shared risk, and in turn shared upside for service success
The service provider can leverage its existing OSS/BSS infrastructure to support pricing and monetising opportunities.

In the era of digitalisation, it is increasingly rare to find a single company that can provide a holistic solution to meet customer demands. Automobile manufacturers excel in manufacturing and delivering a vehicle that can get you from A to B but need a host of partners to extend beyond and deliver a connected car experience.

Cable providers excel in laying fibre/copper to the home/premise and delivering customer experience but see over the top providers as providers of higher value services that extend beyond their existing offerings, and satisfy their customers demand.

As for telecommunications providers? Their issues are exactly the same. They excel in network operations, customer management and the ability to orchestrate, provision, deliver and bill for their existing services. IoT to the telecom provider is like a telematics company to the automotive manufacturer….an outsourced high value components of a broader solution that extends beyond the internal offerings, […]

The post Profiting from IoT – Look to your partners for success appeared first on IoT Now – How to run an IoT enabled business.

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Posted on: April 17, 2018

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