You would think that I would be a huge fan of closed systems.  I mean, I love Apple, and they are the biggest closed technology system on the planet.  Steve Jobs used to talk about how companies needed to make both the software AND the hardware in-house to make things run smoothly.  The result is that Apple products do work well together (for the most part).  So, I must love the idea of using closed systems for M2M, right.....For the most part, the answer is "It depends".

Now, I should probably first describe what I mean by a closed system, at least from the perspective of an M2M solution.  There are some great solutions today where consumers are able to purchase a complete offering from a single company.  These solutions include everything from the company's own hardware, software designed in-house and even includes the cellular airtime.  In many cases, all of the sales for these companies are even done by employees of the company. 

The Pros

Why is this model successful?  What are its pros? Well, for starters, a lot of people believe in the "one throat to choke" model when it comes to technology.  Simply, if one company makes all of it, there shouldn't be many compatibility issues and it should be much easier to get support.  And....this is usually the case.  People (and companies) are busy, so if something works well, why would they care if it all comes from the same company?

I think this mentality has led to an incredible spike in many key areas of the M2M solution world, ranging from AVL / Fleet Management to SCADA / Remote Monitoring to Digital Signage.  And, I think that trend will likely continue, as it follows other trends of outsourcing in the Technology world (like Cloud-based computing).

However, is this type of solution always the best thing for customers?  I don't think so, but the answer really depends on the customer.

The Cons

Here are some situations where it may not make sense to use a closed system:

You need the same solution across multiple geographical areas

With the boom in the Internet, it is easier than ever to have solutions deployed all over the world from just about anywhere.  However, M2M brings a different level of complexity when compared to many other solutions.  First, there is usually a remote device that feeds information, and it often uses the local cellular network.  Using a solution from Norway, as an example, may not be the ideal choice for a deployment in Argentina.  Depending on the size of the company, there may be Support issues (ranging from time zones to language).  As well, if the company is not using a device that is commonly certified or used by most carriers, there may be certification or deployment issues.  Finally, there are a lot of differences among the user base (even in the same company) depending on where they are deployed.  So, having to use the same device all around the world is something that may not be ideal due to differences such as the age of local staff, as an example.

You like to stand out from your competitors

One of the great things about a hosted solution is how fast a company can get out changes/upgrades/fixes to every user.....that is because every user is using the same thing as you!  This isn't a problem when you are using something like Facebook, as this is actually one of its selling points.  However, you may wish to have something that your competitors do not, and that isn't as easy using a closed system.

If you are using the same software and hardware, how do you differentiate yourself?  Some closed systems do allow for a considerable amount of customization, ranging from the appearance of the software to different hardware choices and even to how the information is reported.  However, by its nature, it is impossible for one company to do something that cannot be somewhat copied by another company, as the building blocks are the same.  If that same company uses a combination of products (especially if they do some of the work in-house), there is more opportunity to differentiate itself from the crowd.

You like to change things up often

I heard a funny joke the other day that it is easier to separate yourself from the old Communist party in Russia than it is to get away from Apple after you make the leap.  Sadly, there may be some truth to that.  After you make a big investment in content on iTunes, as an example, one may not want to buy them again in another format.

Now, imagine this on a much bigger scale.  What if you have started to run your entire business based on a closed system?  How easy would it be to make the change to a different piece of hardware, software or to integrate the data into another system?  Some closed systems do allow for flexibility in some of the choices, but it may cost a ton of money/time (or involve scrapping your entire initial investment) to change to a new system.  One has to ask these questions before jumping in....

Bottom Line

I used to love the old Mac vs PC ads on TV.  Apple played up its reliability and long-life of product as advantages over the PC world.  However, you paid for that privilege, and paid dearly for it.  Apple hardware was significantly more expensive, the selection of software is much less and there were all kinds of incompatibility issues to using Mac.  This, along with other reasons, explain the success of the Windows platform and its dominance in the business world.

People (and companies) like choice, and the ability to select things that best meet their business goals…and this is not always compatible with a closed solution.  So, is a closed solution right for you?  It may be, but know what you are getting into (the good, bad and the ugly) and make your decisions wisely. 

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