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IoT expert asks: “What’s Beyond Voice?”

For communications service providers (CSP) facing significant churn in traditional lines of business such as voice, the Internet of Things (IoT) provides tantalising opportunities to reverse their fortunes. At first glance, monetising IoT would appear to be a slam-dunk for the comms industry. After all, they control the networks that IoT devices must traverse. But if CSPs are to reap the financial rewards from the billions of connected smart objects, charging for connectivity alone won’t cut it. Nick Sacke explores different ways in which the channel can monetise IoT data and also, crucially, what steps CSPs need to take in order to ensure they have the skills and digital capabilities to take advantage of these new business models.

The current apparent stagnation in the IoT marketplace within the UK is incredibly frustrating. With no national Low Power cellular network set to be in place before the end of 2019/20 to support IoT deployments at scale, many companies have placed IoT investment plans on the back burner, believing there is no point in embarking upon half-hearted strategies that cannot be effectively realised without a Tier 1 carrier infrastructure.

For CSPs and resellers experiencing increasing competition and pressure on existing revenue streams, this IoT hiatus is potentially disastrous. From the drop in traditional voice revenue because of the uptake in Unified Communications and Voice over IP (VoIP) to the commoditisation of connectivity and broadband services, the downswing in traditional communications revenue is unprecedented. Even the promise of additional revenues from the shift towards the cloud and delivering hardware, software and infrastructure as a service solution has hardly plugged the gap, with limited opportunities to add value and minimal margin on offer against service providers leveraging substantial spending with industry giants such as AWS, Google and Azure.

To be frank, however, this hiatus may well prove to be a blessing in disguise: CSPs and resellers believing there is money to be made from the connectivity aspect of IoT alone are viewing the IoT opportunity in a very limited way. Even the cellular variants of the IoT networks that are currently available are already becoming heavily traded and commoditised – competition is tough and margin is lower than traditional 4G voice and data services. If CSPs are to effectively replace lost revenues and add new income streams, IoT connectivity alone is never going to be the solution, irrespective of network delays. They need to take a different approach.

 

IoT Ecosystem

So, what are the IoT opportunities beyond connectivity that offer CSPs and resellers the chance to unlock extra value and earn more revenue? A complete, end-to-end IoT project encompasses many aspects of both technology and service delivery, from new devices to Low Power network infrastructure, security to applications, and data analytics to brokerage. All of these areas offer access to potentially significant new revenue streams – but CSPs and resellers will first need to invest in both new skill sets and new business partnerships to access these new opportunity areas. And that is where the next 12 months offer a chance for organisations to truly become IoT-ready.

In addition to getting up to speed on the various wireless network communication protocols, including both short range and low power, long range technologies, it is essential to understand how new IoT hardware and software platforms can be used to analyse and make sense of the large quantities of data being collected. It is also essential to understand how to secure this data – resellers gaining the skills to effectively protect the new data being harvested across an IoT deployment will have a chance to create a very profitable business stream in its’ own right. It’s a challenge but companies need to take the time to build relationships, gain knowledge and find their place within the IoT ecosystem.

In addition, there are a number of IoT incubators now offering funding for start-ups and new business ideas in this area. From Digital Catapult’s change led innovation programmes bringing together researchers and small businesses with larger organisations to address real world industry challenges, to test beds that support the development, testing and commercialisation of ideas, there are significant opportunities for organisations of every size to start to actively engage with IoT technology solutions and test use cases. There are also growing numbers of Regional Innovation Centres across the UK that provide access to expertise in all the underpinning IoT ecosystem technologies, enabling companies to gain this essential knowledge.

 

Local deployment

Furthermore, while it is the creation of national Low Power IoT networks, such as LoRaWAN deployments in France, the Netherlands, the United States, South Korea and South America, that have undoubtedly kick started IoT deployments at scale globally, inspiring organisations to explore and deliver a raft of new business opportunities, the lack of a national UK LoW Power IoT network right now is not necessarily a fundamental inhibitor. Not all IoT deployments will require such a national network – there are multiple localised options and/or vertical market solutions that CSPs could and should be exploring today to gain essential insight and experience, and deliver against a customer use case requirement.

Existing networks such as Wi-Fi and BLE, as well as Low Power networks operating in unlicensed spectrum, can be blended to support localised IoT projects that involve hardware, software and application/analytics service revenue. From facilities management to distribution and airports, there are several proof of concept IoT deployments currently being undertaken within these ‘closed’, campus-type environments.

Furthermore, with the expansion of the Smart Cities project to some new locations, with attendant investment, there are a number of opportunities for CSPs and resellers to become involved and propose innovative applications. The fact is that even though a national network is undoubtedly required to support IoT at large, there is still far more IoT investment and deployment being undertaken than many organisations realise – and CSPs and resellers could and should be far more actively involved in this market opportunity today.

 

Trusted advisor

With other countries moving forward with IoT deployments at scale supported by national networks, there is no doubt that the frustration levels with the lack of progress in rolling out low power infrastructure across the UK is growing; but CSPs and resellers should make the most of the gap in infrastructure deployment to gain a foothold in IoT opportunities now. This is the perfect time to build skills and confidence in the diverse aspects of a complete IoT as a Service deployment; a chance to deliver proof of concepts and critically, to discuss IoT opportunities with customers. Have the conversation. Where are organisations in their IoT thinking? Where is the business case? Is there an opportunity to embark on a small scale local deployment?

Delaying engagement with end-to-end IoT should not be an option: it will be a key competitive resource and revenue base for years to come. Organisations have 12 months to get ready, build up skills and relationships and get concepts tested and, critically, become a trusted customer advisor for IoT. Those organisations that act today will be in the best possible position to gain a strong position within the IoT market and drive very significant new revenue streams. It is time to make a change – so why wait?

 

The author 

Nick Sacke is Head of IoT and Products at Comms365

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