What difference does an operator M2M alliance make?

December 23, 2013

GMAMobile operators are working hard to formalize alliances for the M2M market. Global M2M Association recently added Bell Mobility and Softbank to the team of collaborating operators. The other GMA members are TeliaSonera, Deutche Telekom, Orange and Telecom Italia. The M2M Multi-Operator Alliance just re-branded themselves to M2M World Alliance and includes SingTel, Telefonica, Etisalat, NTT Docomo, Rogers, KPN, Telstra and Vimpelcom. The aim is to provide something like a similar customer experience across the covered countries, making the alliance brothers and sisters look attractive to customers and partners.

This sounds easy, obvious and becomes a way to compete with the really big players like AT&T and Vodafone. But reality bites. Even if they all use a very standardized network it is very challenging to bridge national, cultural, strategic, technical, operational, practical and political differences between the large organizations and countries involved. And on top, most M2M business is and will remain local. The devices are in many cases fixed why roaming is less of an issue. One can argue that by collaborating with colleagues operators will learn from best practice and further down the road they might make collective decisions on systems to use etc. That would be good but not really so much benefit for the M2M customers as for the operators themselves.

Another way of looking at it would be that as long as these efforts circles around connectivity and related services like billing, support, certification and device monitoring chances are realistic that they could be fruitful. However, the value delivered would be difficult to charge for since customers expect this to work already. And having operators to collaborate on industry specific solutions with increased revenue potential seems less realistic. And as long as all territory isn’t covered the common facade will need odd additions to give some customers what they are looking for. Yet another challenge to the alliance concept is all M2M solutions using other connectivity than the cellular networks. And even worse, it’s obvious that most solutions will use a mix of connectivity and the mix will change over time. Mobile operators have almost 200M M2M subscriptions in use by now and the growth rate remains 25-30% per year. But there are a lot of devices connected using other fixed and wireless technologies. A quite common estimate is that some 10% of the connected things will have a SIM card.

Don’t get me wrong: I really like the airline alliances and appreciate the efforts undertaken by the operators to collaborate. But I don’t think these efforts will change the destiny of M2M in any substantial way.


M2M enabling efficient marketing

December 11, 2013

Evian DropCompanies are investing a lot of money year after year to communicate with their customers and influence their perception of their company and brands. The budgets are there basically to sow for future sales and they remain on the same level year after year measured as a percentage of sales. The ever-increasing challenge is the growing number of channels to be used, and the constantly changing relative importance of them. But the best channel by all means has always been the product itself. Customers who buy it has it and use it often for a long time. People around them might see them using it. Satisfied users as well as dissatisfied users are happy to tell others about their experience.

All of this is well-known facts. But what is less known is that it has become realistically possible to establish a continuous dialogue with the products and also the users of them depending of what product it is, by using modern M2M or Internet of Things technology. Examples of products that often are connected already are: trucks, electrical meters, cars, alarms, vending machines and coffee machines. They are typically connected for operational benefits like being able to tell the truck driver to go to a service facility and depending on where he is propose which one, for electricity companies to measure and report consumption almost in real-time, for vending machines to understand when it’s time to go there to fill it up and better schedule the service route, for coffee machine rental companies to change recipes over the air and for alarm companies to get the alarms automatically. This is all fine and the normal first phase of an M2M investment. Operational value is easy to realize and make ROI investments on thus easier to get project approval and budgets for.

As we all know by now: data is the gold of M2M. And with these things connected we can gather and interpret the data from the connected things and start use it to create strategic value. Examples could be that the owner of the truck could measure how drivers actually drive, provide training to them and become a more sustainable company, the electricity company could offer customers better price off-peak hours, vending machines would get decision support from real data to know what products to have on weekends and warm days in different parts of the country and to use dynamic pricing, coffee machine companies could tune the choice of coffee for different seasons and learn customer’s coffee drinking habits and the alarm companies could add new adjacent services to their alarm infrastructure to become more competitive. All these things are examples of how the collected data could be used to add brand value, competitiveness, customer loyalty, innovation and attractiveness for employees, etc.

We are in the teen-age of M2M aka Internet of Things and many companies have started to connect their things, mainly for operational reasons. But it is still very rare to see companies using the data to create strategic value. Most consumer goods is not connected and if it is, there is no organized use of the data collected. Most professional equipment isn’t connected either and if it is, the data is rarely used in an organized fashion to create strategic value.

But this is about to change and I think we will see a lot of new examples in 2014. A number of new relevant ways of connecting things are available including the power-efficient and very small Bluetooth 4.0 chips with innovative solutions like iBeacon, networks optimized for connecting millions of autonomous things like Sigfox and a host of different ways to associate real life things with an avatar on the Internet like QR-codes, smart cameras, RFID and innovative solutions from companies like Evrythng.

This isn’t about technology. It is only when clever strategists, progressive marketing directors, creative advertising agencies, determined product managers and innovative business developers really understand what is practically and financially possible today that true innovation beyond operational value creation starts to happen. Interesting examples of creative customer communication through products could be the Evian Smart Drop, Volvo’s On Call app enabling their B2B+B2C model and Apple’s recent launch of an iBeacon based service in all 254 Apple Stores in the US.


No news is good news – M2M will remain fragmented!

December 5, 2013

gold-bars-3Data is the gold of M2M! This remains the most important thing to keep in mind when trying to understand where the industry is going. When collecting the data from sensors and sub-systems of all sorts, we need to understand the context in order to turn the data into useful information. Data analysis without understanding the context opens up for poor conclusions and decision-making down the road. No news here! The value of the information created appears when the information is properly integrated into business systems, decision-making systems, etc. No news here either!

The good news is that the need to understand the context for the data collected and the fact that value materialize when the information is integrated into ERP systems, processes and decision-making systems clearly points towards a fragmented market with successful players focused on industries or functions. Good news is that this is how the software industry has been structured for years. And efficiency is achieved by generic platforms, tools and API:s which specialized applications can utilize.

Since M2M will have to become an international business to benefit from scale this brings us a “glocal” value chain like this: customized or specific software provided to customers by local integrators, resellers or consultants working with specialized international M2M Service Enablers. Software used is based on generic platforms, tools and API:s – this is where Oracle, IBM, Microsoft, SAP and others come in. And the M2M Service Enablers are agnostic to devices and connectivity. And sensors are provided by a variety of specialized companies. 

Voila!

So which conclusions could we draw? The three most important conclusions to me are that:

  • M2M Service Enablers need to be agnostic to connectivity and device
  • there are many M2M Service Enablers in each country today and only the ones who are really specialized, context aware, will survive when it becomes an international market
  • generic software companies as well as connectivity providers need to figure out how to work with the best M2M Service Enablers

The obvious need for network agnostic M2M solutions

November 10, 2013

Monnit2.pngData is the gold of M2M! Today even “monkeys” can connect a couple of things, collect the data in the cloud and present it in an app. And now, in its teenage, the M2M aka Internet of Everything industry is splitting up in three distinct parts: collecting data (sensors and devices), managing data (analyzing, manipulating, combining data) and distributing data (apps, web, integration in business systems, decision-making systems). Each of these three parts have to be perfectly resolved to make a great M2M solution: efficient and sensitive sensors connected using relevant networks, secure and efficient data management where understanding the context is absolutely required, and great, sticky UX in apps and web interfaces are examples from recipes of culinary M2M dishes.

It is when the collected data cautiously has been transformed into information and delivered into business applications that the value of M2M appears. The cold chain for the lobsters from Canada just delivered to the store is uninterrupted. The car that just alarmed the response center of an accident has three passengers. The route suggested by the navigator has risk for ice on a bridge 2 km from here.

With data transformed to information and delivered in relevant applications being the key for M2M solutions it is obvious that the access networks are secondary. Each solution in the hands of customers should ensure proper information delivery using the best available network option given the situation. Requirements on bandwidth, QoS, cost, latency, SLA, power, size, investment horizon, etc should determine which access network to use for each device and sensor. I see only two ways to deliver on this: either the service providers provide a portfolio of access options to serve the clients  or the M2M Service Enablers will have to get access from a mix of service providers. At M2M Summit Scandinavia last week I was glad to hear that both Vodafone and Deutche Telekom share this view and aim to provide a solid portfolio of connectivity options for M2M customers.

Talking about access networks for M2M: Connode was just awarded M2M Company of the Year in Sweden by Mobil Business. Once again a great winner, once again a member in Swedish M2M Association.


Big Data for M2M – too much too soon

October 27, 2013
Walker Information

Walker Information

The M2M aka Internet of Everything market is developing quickly. It is interesting to see how analysts, vendors and journalists over the last few months collectively shifted from one big number to another – from number of connected devices to Big Data business potential for Internet of Everything. It is a sign of growing up that we leave the connection focus and huge abstract estimates on number of connected devices for a focus on data and information. Data is the gold of M2M and I’m pleased that the industry focus is shifting towards the information. The industry loves buzzwords and in the M2M case we ended up in the Big Data bucket. ABI just estimated that Big Data and Analytics in M2M will generate revenues of $14 Billion in 2018. We are in the beginning of M2M aka Internet of Everything and organizations are starting to gather useful information from sensors and things. We see more open API:s and people have started blending the collected M2M data with other data to enrich the value of the information. But few if any are even close to a situation which Big Data is addressing. Most data collected in M2M applications are a couple of bytes from time to time. When mobile networks are used its predominantly tiny data in 2G networks, a lot of narrow band wireless sensors are used and when POTS is used it is typically a couple of seconds transmission. And it is not likely to change! Most of the data we are collecting from things are meter reading data, positions, status information, health data, times and so on. Nothing of that comes close to Big Data. But with big volumes of sensors and transactions we will rather need sophisticated decision support systems.

So why are Big Data brought into the M2M aka Internet of Everything discussions? First and foremost people understand that focusing on number of connected devices isn’t interesting any longer and since the solutions and applications most often are industry, function or company specific it is really difficult to translate them into mind-blowing numbers. But by looking at it from a Big Data point of view new huge market numbers are the results. Secondly, as we become more data oriented the IT companies are getting involved in Internet of Everything. And since many of them are preaching the need for Big Data solutions it is easy to bring the “M2M stuff” into the Big Data story.

I see a risk that the Big Data twist on M2M will make organization miss the ball in their own M2M efforts. Volumes, velocity and variety is not among the key issues in M2M projects today. It is too much too soon. In my experience the best approach is to get going, connecting a couple of things together with a relevant specialist M2M Service Enabler who has most of what is needed already. That way we will learn rapidly from real-time data in our own business and the trials are rapid and affordable. Then its quite easy to see what data to collect from which sources and step by step develop the collecting, management and distribution of data for maximum value to the organization. It is only when the information appears in business systems, business processes, decision-making systems or user applications that the value is realized. We simply don’t need any Big Data methods or solutions for this. It is obvious though, that sooner or later, especially if streaming data is involved, organizations will have a lot of data to process. And M2M applications will of course increasingly add to these systems down the road.


Inspiring examples: Tire Pressure Monitoring Systems – TPMS

September 23, 2013

TPMSVehicles with wrong tire pressure cause accidents and consume excess energy. Tire Pressure Monitoring Systems (TPMS) were developed to prevent these issues. The first passenger vehicle to adopt tire-pressure monitoring was the Porsche 959 in 1986 and today it is becoming a legal requirement in more and more countries. Car manufacturers have been introducing different TPNS systems more or less voluntarily but in the United States, as of 2008 and the European Union, as of 2012, all new passenger car models released must be equipped with a TPMS. Similar laws are on their way in Asia-Pacific.

TPMS are definitely complex from an engineering, communication and product point of view and the combined investment, including equipment in garages and motor vehicle inspection sites, the sensors in the tires and the receiving part of the in-car system is very big. The National Highway Traffic Safety Administration (NHTSA) in the US estimates that 660 fatalities and 33,000 injuries each year are attributable to crashes caused by underinflated tires (Bob Ulrich, Editor, at Modern Tire Dealer) so it seems like well working TPMS can help save lives, money and the planet. But every system like this is always a potential hacker target and Rutgers University and the University of South Carolina released a joint study some years ago indicating that they had succeeded to hack a car through the TPMS.
In any case, this is a typical M2M application – it’s been around for years, many of us have them, they are not SIM-based and they deliver on the three M2M promises: safety, sustainability and efficiency.

The M2M Service Enablement space is heating up

September 5, 2013

1102_web-header.inddWe have already gone from connectivity focus to focus on operational value: faster, cheaper, greener, safer and so on. Pain and results are easy to quantify and ROI calculations fairly straight forward. But the actual development of the solution requires a M2M Service Enabler to become affordable to develop and maintain. This is old news together with my mantra: “data is the gold of M2M“. But it is interesting to see that the service enablement space is heating up.

To start with, my Swedish M2M Service Enablement alliance just said welcome to member number 14 and all Swedish mobile operators but 3 are sponsors. The members in general report growing interest and business as customers are becoming educated and ready to move. Next week 12 Swedish M2M companies will join me going to Düsseldorf as bilateral partners to the M2M Summit where we have a common stand and speaker slots. That is more M2M service enablers then ever participating in an international M2M event arrangement I have done up until now.

Earlier this week Telit announced their acquisition of ILS Technologies for $8.5m cash and Telenor Connexion the purchase of technology and IPR from Iowa. Both ILS and Iowa are M2M Service Enablers! Increasing M&A activity in a segment is always a sign of market consolidation and a result of executives being convinced that they know where the industry is going and where they want to be. I expect many more M&A deals with M2M Service Enablers involved over the next year or two.

My key advise to M2M Service Enablers remain: focus, focus, focus. As the M2M business becomes glocal you will meet competition from a lot of places and players. But customers only see two or three players in any given industry or niche.


M2M – a glocal business!

June 29, 2013

Parking in NiceWhat more does it take to make M2M aka Internet of Things – everything or some things – happen big way? Let’s revisit the key components again. Data is the gold of M2M and the winners will be those who best utilize the data captured. Integration of data in existing business systems and processes is key to maximizing the value. Distribution of information through relevant channels and to terminals of users choice, using open api’s and gorgeous human-machine interaction is required for the applications to be used. Generic Device Control platforms on top of service providers networks together with Specialist Service Enablers are required to make it affordable to develop and maintain applications for clients of all types. The winners in Service Enablement will be the ones who understand the data they are dealing with and due to the huge amounts of industries and functions to be served Service Enablement will be a very fragmented part of our industry.

I see most of this happening now and our industry is definitely developing fast. We are in the teenage stage already with clients moving from thinking and talking to doing. From Powerpoint to pilots. There is absolutely no better way to understand what happens if one connects things than actually connecting some things to play around with. And there is no better way to go for that than to contact a Specialist Service Enabler who has most things ready. Connecting things and collecting the data in the cloud was good enough 1-2 years ago when technology was the key challenge. But today the challenges are mainly business centric why understanding the context of the data is key to succeed. This is why Specialist Service Enablers is the right choice when it is time for a pilot or proof of concept project.

But there is one major thing missing: Internet is global, ICT is a global business and Internet of Things will have to be global as well to prosper. Vendors and operators are working quite hard to make this happen which is great but it will take long time and they can’t make it themselves. Most organizations in the world are small to medium-sized and the software they use are mostly local or localized. Law, policies, culture, language, taxonomy, habits, taxation, religion, alphabet and friendship are examples of things that make people use local software. And it will continue to be like this for many many years. Since the data captured in M2M solutions should end up in business applications, maybe blended with data from public or commercial sources, we need what I call a glocal value chain. The global component is needed to drive economies of scale and enable international business etc. The local part is there to cope with the local requirements, to ensure proper integration in business systems and to engage integrators, consultants and developers locally bringing their clients with them.

Glocal value chains are always difficult to make work. But in our case, whatever we call our industry, I find it quite straight forward. The global part consists of operators (like Telenor Connexion) and their alliances (like GMA), Telecommunication vendors (like Ericsson and Telit) and international ICT vendors (like Cisco, SAP and Oracle who all have started to move now). Ever since Ericsson’s 50 Billion Devices statement this inside-out effort has been coming along quite well. The local part, i.e. developers, integrators, resellers and consultants, has in most parts not got going yet and therefore the small to medium businesses in general are in waiting mode or not even aware. Specialist Service Enablers constitute the missing link. Due to missing operator device connectivity services they have had to learn to deal with the connectivity layer directly. And the services they provide to customers in the industry they target is to a large degree useful across boarders. To me it’s clear: operator networks with device connectivity services together with Specialist Service Enablers interfacing to local developers and integrators is the way forward. The challenges are primarily commercial and practical, not technical. I am working with members of Swedish M2M Service Enablers in several projects along those lines and it looks very promising.


Specialist M2M Service Enablers make it happen!

June 15, 2013

SMSE-logoAn M2M Industry in its teens is a reality. Decision makers are beginning to looking into threats and opportunities with M2M / IoT, and especially product owners are moving to real-life trials and action. I have still to come across a trial which didn’t bring unexpected results and insight! Therefore I keep on arguing that people should leave Excel and Powerpoint behind for a while, and make a trial. Just connect five-ten devices and see what comes out. My favorite example is Springworks who always work very thoroughly and connected their boss’ car and made it tweet to the employees.

If trials and action is the right approach at this stage of M2M, then the value of Service Enablement is even more obvious. If you can find yourself a company who already have built the basics of what you need (i.e. the connectivity part, a cloud based context-aware data service and distribution capabilities through apps, web and maybe other interfaces), who understand your application and are willing to help you getting going fast – just do it! For little money and effort you will get fantastic data in almost no time.

This is why I established Swedish M2M Service Enablers (SMSE) in March 2012. Our objectives are educating the market, promote Sweden as a good place to look for M2M Service Enablement and to promote the alliance members. As of yesterday we added two new members – Fridat and Vinnter – and now we are 12 members and 5 sponsors including TeliaSonera, Telenor Connexion, Tele2 and Net1.

Now when decision makers and product owners want to start doing things the M2M industry runs the risk of loosing them since it is very hard to know where to go to get help. Their existing IT and technology partners will not be able to help and quick small trials are not really what the operators and the consulting firms are keen on. This is where the specialized M2M Service Enablers come in. They will help the industry picking up the interest and turn it into small affordable good enough quality trials. We have presented this pitch at events, meetings and in articles internationally over the last 15 months and we sense momentum building up. Service Enablers from other countries want to join us (and we work with some informally) and we are increasingly asked to come for events and customer meetings, even bilateral efforts.

Swedish M2M Service Enablers (SMSE) is an informal small alliance of companies sharing the desire to be part of building the connected society, Internet of Things, Internet of Everything or whatever we want to call it.  They all work really hard in a tough immature market and their creativity and determination to make it happen is fantastic. And there are similar fighters around the world of equal importance to the success of the industry. In my mind they are the key to a successful Internet of Things and I would welcome any initiative that would make life easier for them. Our next big effort is on Tuesday when we run M2M For Real™  2013 in Stockholm, sharing eleven inspiring real-life M2M-cases with a large number of decision makers. Please keep your ideas, proposals and invitations coming!


Mobile World Congress 2013

March 3, 2013


MWC2013Mobile World Congress 2013 is over and some 72.000 visitors and 1.700 exhibiting companies have gone home. The new location – Fira Gran Via – was more “professional” and space, logistics, food, etc was better. But on the other hand, it is far away from down town Barcelona which made people spend much more time in the traffic. And at a couple of occasions the traffic turned really bad.

I have obviously not seen everything and met everyone so my conclusions have no trace of science:

The over-all impression was quite boring rather then exciting. Devices, boxes, antennas and software architectures all over the place and the devices really look the same. Is this a sign of commoditization? The very serious fact that Europe is seriously behind in LTE usage (4% of subscribers world-wide acc. to GSA) should make a lot of Europeans nervous. Our entrepreneurs in the European mobile industry might start move to the US like IT entrepreneurs have done for many years.

The value of MWC continues to be the interaction between people from the same industry across the world why parties and sub-events continue to be important. The 5:th Swedish Mobile Association-party on Monday was spectacular again and my job as bouncer was as easy as all previous years.

There is a growing number of visitors and exhibitors from other industries mainly due to M2M. I guess there were 20 more or less connected cars to look at but I also found exhibitors like Assa Abloy with their connected locks in a small both. I believe this increased focus on what to use the mobile network for is a good development – maybe the event should be divided in two: building and operating networks – using networks.

M2M was everywhere but the heavily promoted GSMA Connected City part of the event I unfortunately found quite dull. In the far end of Hall 3, few visitors, a lot of screens with presentations and no real energy or “heat” (if we exclude the Gangnam Style dancers from KT). And I couldn’t find anything about OTA provisioning of SIMs which was demonstrated by GSMA last year. Connected cars was clearly the most discussed topic in M2M followed by mHealth. I believe it is a sound development that focus on M2M itself disappears (no customer has ever asked me for M2M) and that we start discuss real problems with real customers. The industry needs to be able to create value for the huge SMB market and not only the multi-nationals, consumers and governments. That is the key challenge for M2M today.

Ericsson’s Key Note event Tuesday night was a highlight: well structured and executed with M2M and Networked Society as a leading theme. And finally Vestberg invited Avicii on stage and then they launched a new song right there, XYOU based on a crowd-sourcing process. The thing I really liked was that they showed the Twitter feed from when Avicii entered the stage and when they played the new song we could see it spreading over the Internet on another huge screen. Well thought through and executed! I’m not sure everyone in the audience understood what was going on but my 17 years old daughter was really impressed already by the SMS I sent her.

My choice of coolest product at the show was also in the Ericsson hall. Under the banner “Windows of Opportunities” they demonstrated four connected windows solving real problems. My favorite was the one for skyscrapers which generates electricity from light coming in. I hope they have solid patents in place!

Personally my highlight of the week was outside of MWC. I was invited by Prof. Aninyda Ghosh, assistant professor of entrepreneurship at the great IESE Business School, to give a speech on Parallel Entrepreneurship. I enjoyed every minute!


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