IoT markets need more direction, not more platforms and niche products

I always enjoy going to the Bay Area, and try to do so a few times a year.  Sure, the weather (especially in the south part) is much better than where I live most of the year, but I also enjoy going there because of its "energy".  No, I don't mean the over-priced electric bills, but rather its creativity/excitement towards new technology. 

So, it was quite fitting that as part of the recent IoT World show, there was a section for startup companies who are looking to break into the exciting world that we live in. 

One of the great inventions to come out of Silicon Valley was the great movement towards Social Media.  It took the Internet to a whole new level and made many people quite wealthy in the process.  The reason for the popularity in Social Media, at least in my humble opinion, is its ability to appeal to just about everyone.  Ranging from Millennials to the elderly, there is a platform that appeals to you. 

I think we need to change that mindset for the world of IoT. We need to find better direction, kind of like this picture...

Please, no more platforms and niche products

It seems to me that everyone is using a little too much "social media" thinking when it comes to IoT.  An incredible amount of companies seem to think they have created the best "mouse trap", meaning that they have invented THE platform that will be the de facto standard in the emerging world of IoT.  I'm sorry to break it to the vast majority, if not all, of you. You are not going to succeed.  This is not social one is nearly as interested in paying you a monthly recurring fee to use their platform as you think they are. 

As well, I don't think we are nearly at the stage where companies need to get as niche in scope as they are.  Take Facebook...its success is namely because it quickly expanded beyond its initial scope to include the masses very early on.  When your product can only appeal to a very small percentage of the market, you are basically relying on the overall market growing for your company to ever make its way to the desired size.  How about starting off a little bigger by appealing to more people? 

The Bottom Line

I see the appeal to develop a platform, I honestly do.  You just need to focus on adding features while people grow your business at the same time they grow their own. However, I don't suspect that the vast majority of these businesses will be around this time next year.  We need companies to find ways to better engage Millennials and Small Business Owners, two large markets that aren't being as well served as they need to be for us to see the growth we all know IoT can have.

*This blog was originally posted May 25th, 2016

There is almost always a cost to convenience…

As a way of changing my previous unhealthy lifestyle into one that was healthy and maintainable, I vastly improved my cooking skills a few years back. Now I know how to make a fair number of complex dishes that are both healthy and tasty at the same time.

This new found/upgraded skill has an added benefit…it saves money.  By buying all of the ingredients and using my “own” labour to do the preparation, the cost per serving of food is much lower than if I were to buy a similar dish that was ready-made.  So, I eat healthy and save's a good combination. 

But, what if I didn’t have the skills or time to do all of the legwork? In that case, it may actually make sense to buy the meals.  However, this savings of time does come at a cost….there is often a premium (and maybe even a substantial one) to the cost of meals this way.  Consider it a “convenience tax”. 

So, how does this relate to the world of IoT?  

One of the most common features that is used in the world of IT in general is remote updates, especially large-scale ones.  If you were managing 10,000 smartphones, I can imagine that one does not have to think too hard to come up with a great ROI for using some sort of Over-The-Air (OTA) management tool to push out new rules and software upgrades as the sheer logistics involved to do a SINGLE upgrade would be mind-boggling.  Plus, the average smartphone user usually has a pretty large data plan, so there is likely little, if any, extra data charges. 

However, what if you were supporting devices that had a much lower data plan assigned to it? 

One of the benefits to IoT is that since you often just pay for the data that you use, the actual monthly data cost per device is typically small…sometimes even less than a dollar.  This is one of the reasons why the ROI is so compelling.  However, with the updates for firmware being fairly large files, one might find that a single update can eat up more than what the device is supposed to use in a single month, potentially forcing the device into expensive overages. 

But, you may ask…aren’t device updates pretty rare?  Well, they can be, but there is another kind of unexpected source of data traffic that many people may not even think of in their planning phase...the “Keep-Alive”. 

Cost/Benefit Breakdown of a Keep-Alive

With IoT being used in some pretty vital applications, often those where public safety and health can be a concern, it makes sense that companies want to know that their devices are online at all times.  One way to do this is to send a small packet of information to/from the device to let it know that it is awake.  Think of it as calling home to tell Mom and Dad that you made it home safely. 

While this activity is definitely vital, it does come with a cost.  Depending on how often messages are sent (and how large each message is), this can result in Megabytes of extra traffic each month.  Now, if you are using the connection for an application that uses Gigabytes of traffic monthly, it is not likely that you would notice the difference in terms of cost.  However, if you had budgeted 1 MB or less of data, this may throw your entire cost structure out of whack. 

The Bottom Line

Keep-Alive and OTA updates are a great way to maintain a strong level of uptime for your solution while also greatly reducing the day to day activities involved in managing many devices.  However, it is important to understand your cost vs. benefits analysis and whether it makes sense for you to deploy these strategies for your fleet of devices.  Think of it as buying a seafood lasagna vs. making one...both make sense, depending on the situation.

Is Uber the ultimate IOT service out there?

It's Friday and odds are high that many of you are planning a night out for drinks or dinner this weekend...and if you are, I bet Uber is in the mix. I admit that I didn't see the reason behind Uber hype for the longest time. So, let me get this straight, it is a cross between a friend picking me up and a taxi cab?  Why were people so excited by it? 

Having taken a few of them while on the road, I still am not as excited as some, but I do at least see the benefits.  Allowing for a cash-less experience is great, as is being able to get a ride in areas that are not well-serviced by taxis. Plus, in many cities and depending on demand, Uber rides are often significantly cheaper than the same ride in a taxi. 

This got me to Uber the ultimate IOT service out there? 

Ok, hear me out... 

Unlike some companies, Uber doesn't "own" all aspects of the solution.  They don't own the vehicles or the smartphones that their app runs on and they don't provide any network services for the communication to happen.  What they have instead is one of the best business models out there and perhaps the most room to expand in the IOT space among all companies. 

Uber's business model is great

Uber has found a way to make a very good level of profit out of the taxi space without the upfront costs (licenses, vehicles, gas, etc) like taxis have. They also don't have to do a ton of advertising to promote their service to visitors from out of town. As a visitor for personal or business travel, I just need to open my app when I get to a new city. Uber is also able to adjust their fares according to demand thanks to surge pricing, which charges a multiplier on every fare during busy times like New Year's Eve.

Even better, though, they have built a platform that allows for almost unlimited expansion in each city.  From food delivery (UberEats) to car-pooling (UberPool) to limos (UberBlack), they have started to expand their offerings quite nicely.  What is to stop them from getting into the short-term/rush courier business, delivering medical samples and even armored trucks? 

They have some pretty good data to sell as well

As I have written before, one of the ways that companies who offer "free" services actually make money is to sell your data as a whole.  The biggest example of this would be Facebook, but I am actually talking about companies that track your steps/runs.  These companies sell macro-data to municipalities, as an example, to better plan paths/sidewalk expansions.  

Now, who would have better data about traffic patterns in a city than Uber?  They are all over the city, at all times of the day and cleverly use GPS-based tracking at all times.  They would know very well when/where certain bottlenecks happen, how traffic patterns change over time and where to increase pick-up/drop-off areas.  

Uber may lead the charge for driver-less cars

I am not sure that I want to have a real-life version of Total Recall where my cab driver is a robot, but it is inevitable in my lifetime that I will take a driver-less cab/Uber.  Uber already has a lot of the key elements in place to make this move.  Think about it...they have connectivity in each car, they have many planned routes to load (and the drive can be planned in advance through the application) and they have so much data to put into the system to account for possible issues.  

The Bottom Line

When I ask someone to list who is the best IOT company, a few may come to mind.  It may be a modem/hardware provider like Sierra Wireless or Digi, it may be an application company like ones who do Fleet management or it may be a Fortune 500 company providing back-end systems like Apple or Google.  However, it is easy to make the case that Uber is actually much more of an IOT company than any of them.