Service providers explore IoT/smart city solutions
In association with Amdocs
The Internet of Things (IoT) – whereby everything from air conditioners to automated cars, and security cameras to sprinkler systems are connected to the web and controlled via mobile devices from afar – isn’t a thing of the future.
About 6.4 billion devices are hooked up to the Internet, according to a 2015 study by Gartner. By 2020, that number is expected to climb to 20.8 billion, while total spending on IoT services will reach an estimated US$263 billion. And while exact figures can be disputed, no one doubts the market will be huge.
Such connectivity is already improving lives and businesses. For instance, a family in Lewisburg, Indiana controls their farm vehicles and irrigation system using a central digital platform, boosting the yield from soy and cornfields. Cities like Copenhagen, Denmark have installed smart street lighting that conserves energy and improves safety based on factors like the time of night and natural illumination from the moon.
IoT will help perform many functions more efficiently, based on user preferences, location and other metrics. It won’t just save time and money, or provide convenience. IoT will help boost production of entire economies, save lives by freeing up and redistributing critical resources more efficiently, and help preserve the environment through carbon and waste reduction.
Service provider pioneers
Service providers are poised to play a big role in this emerging market thanks to at least two main competitive advantages:
First, they provide basic radio connectivity through which devices transmit and receive information; they are the glue that creates smart environments.
Second, they’re already deeply embedded in homes and businesses. Since service providers oversee huge customer networks and manage large quantities of data, they are well placed to expand their advantage to develop, introduce and integrate IoT services.
It won’t be an easy task, however. Service providers will have to address challenges unique to the IoT world it they are to offer frameworks for managing smart environments.
For instance, data will be more difficult to handle. As more devices come online, the flow of information will grow exponentially. Service providers will therefore have to manage, store and integrate information across large disparate systems.
At the same time, service providers are increasingly challenged by over-the-top providers (OTTs) entering this growing domain. IoT-enabled products like Google’s Home and Amazon’s Echo firmly establish both companies in this new market. More are sure to follow. If service providers do not leverage their competitive advantages now, they are likely to cede ground to OTTs.
Then there’s security. As illustrated by the large cyber-attacks that took place in October 2016, a world of connected devices can also cause disruption. During this incident, hackers used internet-connected devices including printers, cameras and residential gateways to overwhelm servers, slow down the internet and temporarily shut down access to websites.
StarHub, a Singapore-based service provider servicing 470,000 broadband residential subscribers, was among those affected by malware, according to the Financial Times. Explaining how this was possible, the publication quoted John Ellis of Akami, a cloud service provider, as saying, “Devices were instructed to participate in an attack – which could have been targeted anywhere – and this went through StarHub’s [domain name servers] and overloaded the infrastructure.”
To prevent breaches of this nature, as well as other challenges to privacy, safety and service integrity, service providers must employ advanced predictive and preventative approaches.
For individuals, many concerns will revolve around privacy. Customers will want to feel confident their information won’t be stolen or control of their devices lost. Indeed, customers expect nothing but top-notch protection when choosing a service provider. According to a 2014 study by Deloitte, almost 60% of those asked said a single data breach would negatively impact the likelihood of buying brands from a consumer products company. In the same study, 70% of respondents expressed a preference for doing business with companies that protect their personal information.
Successfully entering the IoT market requires a multifaceted set of skills and systems. For this reason, many of the world’s biggest service providers and tech companies are pooling their resources to meet the challenge.
Earlier this year, Orange Group and NTT championed a TM Forum’s Catalyst project called ‘Smart Life: My City, My Home, My Planet’ in collaboration with ESRI, NTS Retail, Amdocs, Infonova and Base-N. The “Catalyst Champions” – Orange and NTT – defined the project’s requirements and then validated the proposed solution developed by the other Catalyst participants. Amdocs’ contribution was its advanced Revenue Guard analytical and cyber fraud capabilities, which addressed some of the key challenges of a Smart Life/IoT ecosystem. These ranged from verifying a subscriber’s identity when joining a service to preventing possible equipment theft, unauthorized usage and unauthorized access. Other challenges concerned dealing with situations caused by human error, such as when an owner forgets to turn off heating when leaving their house.
This international collaboration provides the following key benefits to the Catalyst Champions at first, and ultimately to the industry: it mitigates risks, utilises each partner’s core competency and delivers an end-product to users considerably faster than would otherwise be possible.
And the results are already visible. In November 2016, at the TM Forum event held in Dallas, Texas, TM Forum Catalyst participants unveiled and demonstrated a fully functioning prototype – a comprehensive and easy-to-use IoT digital service on a single platform. The prototype takes into account the product’s full lifecycle, from the point of sale through subscription, configuration, customer usage and bill payment.
An innovative offering
Revenue Guard, the Revenue Assurance and Fraud Management service provided by Amdocs, has developed new and advanced capabilities specific to IoT. Through its acquisition of Revenue Analytics company cVidya last year, Amdocs incorporated into its suite of products, an innovative analytical and advanced fraud management capability that is especially suited for IoT.
First, the software evaluates new customers/applicants during the registration process and calculates a risk score for each. By learning the user’s account history patterns and analyzing new information, the solution improves its abilities to identify unreliable customers and system malfunctions that might result in loss of revenue over time.
Second, once a new customer has been approved, the hardware installed and the smart home complete, Revenue Guard continues to learn behavioral patterns, raising red flags when necessary. For example, Revenue Guard might detect an unusual spike in electricity in a customer’s account. If it fits into behavior that correlates with other accounts – perhaps a heatwave that caused a surge in electricity usage across the board – it might not take action. However, if the action does not fit into a familiar pattern, the solution might choose to bring the case to the attention of the customer’s or provider for resolution. Alternatively, it might continue to monitor the situation without intervening until a further development occurs. This functionality is currently being developed and is expected to be demonstrated at a TM Forum event in May 2017.
The road ahead
For smart environments to truly take hold the way experts predict, service providers need to offer smoother, safer experiences to customers. Data must be better managed and integrated, while strong cyber-fraud protection should be embedded in the ecosystem. New software, incorporating advanced analytics and machine-learning components will help better achieve both goals. Only when companies and customers feel confident and secure about adopting IoT technology, will they be able to unlock the many efficiencies and improvements it offers.
IoT – Have CSPs got what it takes to succeed?
Our VanillaPlus Insight tracks developments in the Internet of Things (IoT) and explores the opportunities this presents for CSPs.
The Insight contains a specially-commissioned analyst report from IoT experts Machina Research as well as features and interviews to help you gain a greater understanding of the IoT attributes CSPs already have and how they can be monetised more effectively.