Global professional services company PriceWaterhouseCooper (PwC) has published a report which concludes that mobile will play a decisive role in the Internet of Things (IoT) ecosystem.
The report gave a broad view of the “vast opportunity” that IoT presents to the mobile operator community, but it included a word of caution as well. According to the report, mobile network operators will be key to the rapid growth of the IoT as the providers of the all-important connectivity for a host of businesses and services. The report also predicted that the IoT will have a US$4.5 trillion impact on the global economy and will add four per cent to global GDP by the year 2020.
As the PwC report points out, mobile is certainly not the only communications enabler in the IoT –WiFi and NFC will also play their parts in combination with mobile to enable IoT services. Nevertheless, mobile is at the core of the nascent IoT ecosystem. In order to fulfil this role properly, mobile operators must be ready to adjust to new business models and usage patterns, which will in turn open up new markets and lead to new growth opportunities.
To do so, each operator must firstly question its readiness in terms of its ability to handle and capitalise on the anticipated surge in network usage that the IoT will bring. What’s clear is that if an operator is to truly maximise the revenue potential of IoT, it must fundamentally change its approach to enabling service adoption and engagement.
The opportunity presented by IoT is the operator as a wholesale partner for a range of different vertical sectors, including healthcare, utilities, automotive and telematics, and branded consumer wearables. The nature of machine-to-machine technology means that embedded devices will be collecting and distributing real-time data without human intervention. For example, mHealth sensors will be used for remote monitoring, coupled with analytics, to process the data and track patients’ conditions remotely.
But how can operators capitalise on the growth of the IoT among these various sectors? One argument is to emulate the success of OTT service providers, with the cloud as the foundation and catalyst for a broad range of new hosted services and use cases. The cloud provides flexible and extendable capacity and functionality that abstracted network APIs simply cannot.
LTE too plays an important part. Its faster speeds and increased bandwidth means new and successful operator-led services are within reach. So operators should be placing emphasis not just on cost, but also on driving time-to-market.
The battle for supremacy in the IoT will be one based on volume, and a short time to market is crucial if new services and new connected devices are to stand a chance of wide adoption. It’s time therefore for operators to revise their views on service shelf-life.
Of course, there will be plenty of long-lived IoT services. But operators will also need to accept that some services might only have a life of three to six months, in contrast to the five to seven year lifespan of traditional operator-led products and services. The onus will be on operators to encourage adoption and engagement, and quickly.
One thing that will drive faster innovation is white label cloud services. In the past, the complexity of operators’ underlying infrastructure has inhibited or prevented entirely new services from being created, launched and adopted. Thanks to the cloud, however, operators can offer developers and third-party vertical partners a range of scalable and feature-rich white label products and services that are ready to go, and which simply need customising for their particular audiences. Meanwhile, white label service activation can leverage existing telco OSS/BSS, and services can be instantly monetised.
In the long run, central cloud activation hubs are the key to ongoing success for operators. As key partners and enablers in the IoT, operators must use the cloud to build out their own ecosystems and also facilitate an open, developer-type environment. Only then can they create and bring to market new and innovative IoT-based services, functions and features at the speed and scale required by their partners and customers.
The author is Ted Woodbery, VP product management, Synchronoss
