Internet of Things (IoT) is certainly a game changer in the coming years. However, the media predictions and analysis of IoT has various other business parameters. Read on to know more.
Let your imagination on domestic applications of Internet of Things (IoT) take its own course. Just imagine that you are far from your home in the office and suddenly you realize that the hall light in your home is switched ‘ON’ or you have forgotten to close your electronic access control front door in your residence. And sitting right in your office, you get to control and access the various systems of your home through your smart-phone app and this is how the things are set-up according to the wonderful technology of Internet of Things.
Now coming to the impressive forecasts of IoT, it is estimated that around 50 billion devices will be connected to the Internet in the next 6 years. Analysts have been very positive in their predictions that Gartner predicts that total economic value for the Internet of Things will be $1.9 trillion in 2020, Cisco sees a 19 trillion opportunity and IDC predicting a market of $7.1 trillion by 2020.
Investment Scenario
All the technology marvels and analyst’s predictions are truly marvelous and indeed promising both from the market and technology aspects. Now back to reality – for successful implementation of IoT, one of the most crucial aspects is the carrier interface. In other words, without nation-wide availability of high speed Internet connection 4G LTE in countries like India, the IoT obviously would not grow as predicted by the media analysts. As far as the investors in IoT see it, there are multiple challenges that need to be analyzed and sorted out. Even with the availability of high speed Internet connections, there are other crucial challenges for the investors in the IoT.
When Google acquired Nest, maker of Internet-connected thermostats, for 3.2 billion USD, other major companies started to acquire the IoT based smaller companies. Shortly afterwards, Samsung acquired SmartThings. As a result of large companies acquiring smaller companies based on IoT services, there are only a few players and investors have no other big choice for the new business investors. But again, investors in IoT have nothing to worry about because end-user products are only a minor part of the whole market share. Fortunately, there are various other components in IoT that has a huge market.
For instance, the use of sensors is crucial in the every IoT based devices and hence the market is so huge that investors can invest in them without thinking twice. So in that aspect for the IoT investors, it’s not a technological investment sector. In other words, investors rather than investing on the end-products, can invest in the suppliers such as sensors and processor chipsets in the vast IoT based market.
Business Strategies
As we know that the arrival of IoT brings new business opportunities for various players, the next aspect is to develop a strategy by defining clear proposition through which you can offer better services to the customers and other business collaborators. The following are the business strategies that will define your business in the IoT sector.
1. Study the Industry and Markets: Assess the Industry and market for IoT so that you can identify the current and future trends and services. Some of the rapidly growing verticals in IoT identified by the experts is manufacturing, automotive, healthcare and end-user domestic market sectors.
2. End-user & Business Engagement: In the IoT sector, the customer-experience has an important place and for that one has to possess strong capabilities and companies should have a direct customer contact that can transform the business ideas and areas of the business set-up.
3. IoT based Connected Products & Services: Assess your present strength to find out the best proposition which can be improved through IoT connectivity and explore the new products or services that can be offered for the IoT consumers. Consider the key aspect of ‘connectivity’ for latest product launches and innovations and how your organization will analyze and apply the resultant data and decide upon which other organizations you can collaborate taking into account the current and future business revenue model and the income stream.
4. Better Business Connection: Most enterprises that design, create, integrate, and deliver IoT based services to the customers should install an preliminary wave of basic IoT connected devices and services. Then the organizations should design and develop from the analytics to help them gain specific goals from the stream of new data that IoT feeds in. In parallel tracks, the developers should also explore ways to enhance the value of the system. At this stage other collaborators come in who add their own value-added services to supplement the services provided by the enterprises that provide core services of IoT that are quite unique. This will set the future course of what business models might emerge in terms of business collaboration in IoT.
5. Playing Company’s Strengths: Your organization has to decide on what unique features of IoT it can offer for the customers. In terms of accurate prediction the markets, how far can you go in parameters such as time factor, capital investments, improvements, deployment of resources, and also the back-up action plan in-case the business plan does not takes-off as expected.
Companies should also possess ‘minimum amount of deliverance’ as a capability in IoT sector. This includes the ability to integrate assorted portfolios of IoT services, capability to manage and analyze vast quantities of data and to explore the possibility of business collaboration with other IoT based companies some of which may serve the common purpose. There might be occasions where companies may possess strong innovation and business developmental capabilities but lack the ‘customer-centric’ service. Companies should also bring in experts who are willing to continuously learn and adapt to the new technologies of IoT as a product and service.
A Brief Conclusion
As new challenges come in the IoT, it certainly offers a promising business to the Industry players who are willing to take the risk. The companies should not get carried away by the mere business predictions and hype created by the media analysts and must focus more on the actual business value proposition to take advantage of the vast opportunities.
R. Manoj. The author is a Freelance Writer.