MNOs’ IoT Platform Predicament

IoT Analytics, the German market research firm, recently published a customer satisfaction assessment of IoT platforms [1]. It covers 50 vendors and applies a broad definition for IoT platforms. At one end of the spectrum, there are multi-purpose cloud infrastructure and platforms, such as those offered by Amazon and Microsoft. At the other end are platforms for niche users, with machine builders as one example.

IoT Analytics used feedback from senior executives in organizations that procured and are deploying IoT solutions to rate the top-25 platforms. There is a slight bias to North America, which accounted for 40% of the mix. Europe (25%), APAC (25%) and MEA (10%) make up the rest of the survey.

For this post, I propose to focus on a summary chart. This maps leaders, challengers and follower IoT platforms across technology and customer-centricity dimensions. The chart highlights a predicament for mobile network operators and especially the large European operators.

Rumelt on 3G: Lessons for 5G and IoT

The consultancy McKinsey recently republished a 2007 interview with Richard Rumelt [1], professor of strategy at UCLA’s Anderson School of Management. Rumelt opened his commentary on strategy by noting that most corporate strategic plans have little to do with strategy. Instead, they typically end up being “three-year or five-year rolling resource budgets and some sort of market share projection”.

What senior managers want out of the strategy process, according to Rumelt, is a pathway to substantially higher performance. That can happen in one of two ways. A firm can either invent its way to success or, it can quickly and skillfully exploit some change in the environment. Examples of such change include technology, consumer taste, resource price or competitive behavior factors.

The telecoms industry finds itself at the intersection of many such changes. On the supply side, the arrival of 5G networks and the standardization of low-power IoT devices provide two industry transition opportunities. These developments will usher in new service concepts and business opportunities.

Innovation at ETSI IoT Week 2017

Last week, I attended ETSI's IoT Week, an annual event to explore the IoT standardization landscape and to see how industry and academics, around the world, are testing IoT implementation ideas for the future. Not surprisingly, the oneM2M standard featured prominently in the program and the display zone of demonstrator projects given that ETSI is one of 8 standards development organization (SDO) partners in the oneM2M project.

However, not everything on the agenda centered on oneM2M. Other standardization efforts were also represented including: ESMIG (energy); SigFox and LoRA Alliance in the LPWAN sector; ZigBee Alliance; and, international organizations such as ISO, IEC. And, several companies, including MNOs, demonstrated how they are addressing new business and revenue opportunities beyond IoT connectivity.

Managing M2M inside an MNO

France’s Orange has a long history in the M2M market and was one of the early pioneers in establishing an M2M competence centre, leveraging the deep expertise of its M2M team, notably in the Belgian market. It was therefore interesting to see Orange Business Services’ announcement of a strategic partnership to use Ericsson’s Device Connection Platform (DCP).

Orange has operating companies in several different countries and is also a partner with Deutsche Telekom in the UK’s Everything Everywhere. Orange is separately a partner with Deutsche Telekom, TeliaSonera and Telecom Italia in the Global M2M Association. In light of these different constituents, one interpretation of the Orange/Ericsson partnership is as a neutral platform that many, if not all, of the M2M operating businesses can buy into.

If this is indeed the strategy, it would shift the responsibility for coordinating multiple platforms, capabilities and expertise onto Ericsson. Channel and account management responsibilities would then more naturally fall on to individual operating businesses.

To get a sense of the coordination challenges and operational complexities that arises in enterprise-grade and multi-platform environments, it is instructive to look at another company, Telefónica.

Launch Strategies for Digital Business Units

Among the many announcements and presentations from Mobile World Congress 2013, one that caught my attention came from Matthew Key, the CEO of Telefónica Digital.

In a post-event blog post Key highlighted how the mobile industry is moving beyond the realm of “phone calls and pure connectivity” with particular reference to M2M and mCommerce opportunities. He observed that “Despite the realization by all telcos of the need to become digital to leverage these opportunities, there is a lack of consensus on how to get there. What then is the way forward?” His own position involves “driving open partnerships and using mobile and digital technology to address pressing social needs”. Partnerships, in a variety of forms, is something I have previously described as a key aspect of business model innovation.

Stepping back, however, what are the key characteristics of other mobile operator ‘digital’ initiatives? And, what does this imply as the way forward as other operators strive to become Digital?

Competitive dynamics of international M2M alliances

This note will be updated in light of new alliance announcements. 

In July of 2012, seven mobile operators announced a cooperation agreement featuring a unique SIM. This appears to be a move to address a segment of customers seeking to deploy global connected devices and to compete with Vodafone's global SIM offering. However, there are other competitive dynamics at play and longer term corporate strategy implications for companies that are using partnering approaches as a rapid means of market entry.