Mar 29, 2017

Making an Impact with IoT and Digital Transformation

A few weeks ago [1], I wrote about the potential for telcos to take advantage of digital transformation opportunities to boost industry growth. At present, much of what passes as digital transformation in the telco sector focuses on new technology (NFV, SDN, 5G etc.). This is understandable given the desire for innovators and vendors to sell new technologies that help service providers adopt more agile and flexible operational models.

However, these ideas do not correspond to transformation in the sense of entering new markets or, of driving revenue growth in new service categories. NFV, SDN and 5G are more likely to lead to juggling between CapEx and OpEx budgets which will have an impact on profitability and depreciation financial metrics rather than driving top-line revenue growth. The Internet of Things (IoT) does have the potential to open up new growth markets and is starting to be recognized as an enabler for digital transformation.

So, is there much evidence that will encourage telcos to enter completely new markets and drive meaningful revenue growth? What characterizes such opportunities and how should telcos approach them?

Feb 4, 2017

Will digital transformation save the telco industry?

Over the past few weeks, McKinsey [1] and the World Economic Forum (WEF) [2] have weighed in on the debate about long term growth prospects in the telecommunications sector. They have valid concerns which arise from projections for low revenue growth and shrinking margins for telecommunications service providers. The near term prospects for many telcos involves the sale ever increasing volumes of data and cloud services to consumer and business customers on the assumption that price elasticity effects will work in their favor and not undermine top-line, revenue growth.

The McKinsey and WEF ideas rely on optimizing the core business and building at the periphery to support digital services and enhanced customer experiences. These approaches take a narrow view of the market for telcos and one and define competition in terms of other telco service providers. Is that really the right way to address the strategic challenge that faces the industry?

Jan 7, 2017

2016 in Review: Shift in Industry Dynamics as the IoT Enters the Mainstream

According to my records, the strength of IoT corporate initiatives witnessed over previous years weakened in 2016, somewhat in contrast to the much greater visibility of the IoT at industry events and in the marketing literature.

While the number of merger, acquisition and investment (MA&I) fell compared to 2015, as a proportion of all corporate events it increased over the prior years.

About 70% of these relate to acquisitions; the remainder correspond to fundraising or investment activities.

Now that the IoT market has become a mainstream idea across the wider economy, the MA&I dynamic reveals a stronger tendency for companies to accelerate their IoT strategies by acquiring capabilities from third parties.

Dec 29, 2016

Industrial IoT Strategy

The combined activities of the Industrial Internet Consortium and Industrie4.0 alliance, culminating in the much expanded IoT Solutions World Congress in October seem to have given significant impetus to IoT adoption in the industrial sector. In several of my discussions over Q4-2016, I witnessed growing evidence that corporate executives have tasked their business development and strategy teams to formulate plans to integrate IoT more closely into their core operations.

The IoT takes most industrial organizations into a new operating domain and requires a process of self-education to begin with. Most of the questions I encountered began around the two topics of connectivity technology choices and approaches to justify the IoT business case.

Nov 29, 2016

Mass-market data monetization

The motivation for this article comes from several recent and groundbreaking announcements relating to the commercialization of consumer data. In one of these, Proximus [1] launched myAnalytics, a service that sells aggregated customer data as a ‘market research’ service for businesses such as tourism agencies, event organizers, marketers and those in charge of mobility management.

Telefonica, one of the larger communications service providers, announced plans to create a personal data bank for each of its 350m customers [2]. This will allow customers the means of storing, managing and selling their own data. When questioned about Telefonica’s plans, Vodafone’s CEO expressed puzzlement as to whether this is any different from everyday protection of customer data [3]. This reaction should set a few alarm bells ringing.

Nov 2, 2016

Impressions from IoT Solutions World Congress 2016

While I often attend Mobile World Congress in Barcelona during February, this was my first experience of IoTSW Congress and seeing Barcelona in October. The show is growing impressively, doubling the number of exhibitors and attendees compared to 2015. If this pace holds up, IoTSWC could surpass MWC within three years, such is the growth potential for the IoT industry.

 In addition to three speaking slots – one for the Industrial Internet Consortium, another for Intel’s Corporate Strategy group and a third on main Congress track - I had several discussions with industrial businesses, investors and solution providers about the state of the market.

Here are a few observations that stood out from the event. 

Oct 5, 2016

SK Telecom’s IoT strategy looks beyond Connected Devices

Over the summer, Korea’s SK Telecom outlined its strategy to capitalize on the IoT opportunity. From a networking standpoint, SK Telecom has invested in a nationwide LoRa network. It plans to offer a hybrid offering in parallel with LTE-M over its conventional mobile network. This combination allows SK Telecom to span a wider spectrum of coverage and cost-structure alternatives. Its technology choices use licensed and unlicensed spectrum, support differing data-rates, and, offer a broad range of embedded module costs to deal with barriers to adoption in low price-point (or low perceived value) devices.