Single purpose M2M solutions

August 4, 2012

Single purpose M2M solutions have started to appear in the market. They are typically addressing one specific problem with a combination of hardware, software and communication. If the problem addressed is clear and considered big enough by many people and the solution works well then the willingness to pay should be possible to build a business around. Provided the solution uses the cloud to deliver the service from, then expanding the solution to include generic devices like smartphones, pads and PCs is an interesting next step at least to access the data but maybe to run the entire application on as well.

A good example is Coyote from France who claims over 1.7 million users of their speed camera alert system in Europe. The service is also available as an app for iPhone/iPad, Android, Blackberry and for Parrot. A Coyote device cost about 250€ including one year of service. A solution like this is also interesting for mobile operators since one agreement can sell hundreds of thousands subscriptions of the same type and each deal like this provides opportunities to add service enablement services on top of the connectivity.

The two key success factors of products like these are a high quality solution to a reasonable big problem and ease-of-use out of the box. Then people are willing to pay reasonably well for the service and word of mouth will work for marketing. Easy to buy and use solutions are also interesting in sales channels. It is quite likely that we will see many more single purpose M2M solutions onwards.

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Posted by magnusmelander

From consumers with love

May 15, 2012
Security, efficiency and sustainability are the three key promises of M2M to businesses. And most applications of M2M address one or several of these straight forward issues in an organization: minimize use of service cars, avoid production stops, save valuable time with accidents, make processes more efficient, automate to avoid expensive labour work, etc. These are straight forward in the sense that we address concrete problems quite easy to put numbers on and investments can be verified using business cases and ROI. But the ultimate value of M2M comes from innovative business models, increased brand value and other less tangible things. And these are much more complicated to identify and dress in numbers. Innovation and creativity is clearly an important part of such efforts and I would suggest companies to look at the M2M consumer market to get ideas and cases to bring home.
There is actually a fourth promise of M2M which I normally don’t talk about to businesses – convenience. But in the consumer market this is a key driver and differentiator. Other reasons to look carefully at the consumer market are the typically limited budgets forcing innovative and cost efficient solutions and the absolute requirement for easy to install and use solutions. In addition consumers are generally more open to cloud services and many of them are early adopters with smartphones, pads and other gadgets. Examples of things and tricks to bring from the consumer space to business could be the use of smartphones to connect devices cheaply to the Internet and the host of innovative cloud services using sensors and gadgets in the growing personal health and fitness market. Imagine how much the home care providers can steal with pride from here! Take also a closer look at how well many consumer services enable their users to use any and all of their devices for the service. A lot to learn there.

And by the way, isn’t the Internet-of-Things a misleading name? There is only one Internet of People and Things.

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Posted by magnusmelander

M2M For Real

May 8, 2012

Connecting things to the Internet opens up for a new wave of innovation to society, companies and consumers. That fact has been talked about and dressed in numbers for the last couple of years. Still we see quite little action beyond connecting “big phones” and electricity meters. Something is obviously missing and I think I know the answer.

We have good enough technology available and we have been blessed with a new category of smart mobile devices with apps perfect to visualize functionality and value for people. And we are in the beginning of the cloud and Big Data era which constitutes a perfect environment for M2M-applications and the data created. Still little action.

As often when powerful technology comes to market it is too abstract for most people to see how they and their organizations will benefit from it. What it will do to their life, business and society. Our industry needs to educate people and help them see the value and opportunities of M2M solutions. It is definitely not about technology – it is about business and should be discussed with business developers, product owners and management teams.

I believe a combination of meetings and a lot of relevant examples is what it takes to create understanding and feed a creative and rewarding thought process. The examples are most often not that your competitor did this, but rather someone in an adjacent industry did something and that was the result. Meetings with theoretical examples don’t work. We have seen some of that already and it sometimes feels like people from the M2M industry tell other people from the same industry how it works. And it is still too early to provide relevant ideas “stand alone”, without face to face meetings, since the context and overall education often is missing.

The method I am using with clients starts with an overview of the market (education) and continues with discussions about problems and challenges in their business relevant for M2M solutions. This normally becomes discussions about cost savings and efficiency which is great. Further down the road we look at business cases and ROI calculations. But the true power of the M2M concept comes to play when we start discuss potential new innovative ways of doing business enabled by M2M solutions. Collecting, cultivating and leveraging the data generated. Selling services or functions instead of products. Going from product life cycles to continuous R&D. Offering customers an unexpected service or feature. Effects to the brand and new weapons in recruiting employees or customers. This is what I believe is the real power of M2M solutions and the Internet of people and things.

This is what I call “M2M for real” and I will do my best to promote this approach beyond our company. A good acid test will be an “M2M For Real” event in Stockholm which the media company Mobil Business is organizing June 20, TeliaSonera is main sponsor and where we will provide a solid introduction and status update on M2M solutions followed by a “smörgåsbord” of examples from all kinds of industries and opportunities to discuss.

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Posted by magnusmelander

M2M enables new business models

March 30, 2012

This post was published on M2M Daily March 15, 2012: http://www.m2mdaily.com/m2m-editorials/m2m-enables-new-business-models/

Many industries end up in the huge global market with ever increasing competition putting immense pressure on cost, performance, functionality, service, etc. One approach to change game plan is to change business model from selling products to selling functionality. Something-as-a-service and pay-per-use are concepts along those lines. It is likely that clients in general prefer such offerings since it feels fair to pay for use, it feels good not to have to take care of product problems and in relevant cases it’s great not even having to host or see the products. For vendors it is easier to manage manufacturing, production and service if they own the products, they improve R&D since they get to know everything about the product life cycle but they will get their revenues distributed over maybe 34 to 60 months instead of up front. That is horrifying and require a lot of change to any company going down this path.

M2M is a key enabler to business transformation. Today we can connect products to the vendor’s relevant systems for planning, maintenance, financial reporting, invoicing, support, etc. From a technical point of view this enables change of business model to for example a pay per use model. Since we can monitor, control and manage the products remotely we can constantly improve everything that relates to the product during its life cycle including preventive maintenance, tune for more efficient energy consumption, decrease downtime due to alarms, make software upgrades over the air, etc. These are obviously relevant benefits also with a traditional business model but the point is that with full control of a product through out its life a service oriented business model looks more attractive.All of this is pure technical and no one should underestimate the complexity from a business, organization, systems and management point of view to make changes like this. But still, M2M makes it technically possible today.

We see an increasing number of cases where companies connect their products but it is most often to improve a specific thing like maintenance. And the risk is that the technical implementation works for the purpose but can’t support  the next request coming up somewhere else in the company. It is still quite rare that vendors also change the business model but there are interesting examples of companies who do. Innovative business models seem more for newcomers than for established businesses. If it ain’t broken, don’t fix it! Well, if it is a good idea someone will do it and it might be disruptive.

I would argue that now is the time for companies to start look into these things. Keep an eye of what competitors and players in adjacent industries does, start play with ideas of what we could do if we connected our products and what the results would be. And most importantly, if you decide to get going, ensure you build a solution supporting needs you might have over the life time of the products.

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Posted by magnusmelander

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