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My personal thoughts and views of M2M aka Internet of Everything

                          The Internet of Everything Chronicle #6
 


Dear reader
 
IoT remains HOT, HOT, HOT and everybody want to be part of it one way or another. About a year ago I decided to focus on the hardware part of the IoT challenge, since all IoT projects sooner or later end up in a hardware challenge. So even if most analysts by now have left the “50 billion connections” behind to focus on the "trillion dollars business opportunities” in data crunching, we have to get the hardware part sorted out before IoT will be grown up. About a year ago we (STING, Linda and I) decided to build a new type of hardware hub where start-ups and large companies with hardware part of their solutions could find ways to collaborate around innovation, based on their interest in the hardware challenges and opportunities. This became THINGS, a 2000 m2 co-workingspace at the KTH Campus downtown Stockholm, which opened March 26 this year and explains why IoE Chronicle #6 is several months overdue. 
 
By now, after just three months in operation, I am confident we are on to something really interesting. We’re on our way to reach 30 qualified start-ups (we believe we have space for around 40) and we already have five industry partners - ABB, Assa Abloy, NCC, Husqvarna and SP - actively working together in the community we have created within and around THINGS. The community includes also Technology Partners like Cisco and TeliaSonera, Service Partners (the first one to be announced any day) and Networking Partners (IoT Stockholm, SMSE, Stockholm Makerspace, etc). The areas we currently are covering are IoT, 3D scanning/printing, wearables, drones, medtech and energy. 
 
So why is this important to the development of IoT? I believe IoT will make most impact and add most value in efficiency, sustainability, health and security why consumer gadgets is of less interest to me than improved processes and decision making in businesses and governments. In order for this to happen big way we need tools and processes enabling rapid prototyping, development and testing in these organisations. And that obviously includes both software and hardware and the ability to develop applications in an agile fashion with the sw and hw projects well synchronised. These are issues we address at THINGS where one of our USP:s is our unparalleled prototyping capabilities (our workshop at site and partnerships with KTH and SP Technical Research). There are also a lot of knowledge and willingness to share among the members and partners which quite easily can be leveraged when needed (one member needed a couple of working beacon prototypes for a client and due to collaboration between Evothings and Tingeer they could send them two days later). The hardware part of IoT application prototyping has become much easier and cheaper with things like Arduino, TI Sensor Tags, Flic and iBeacons. And powerful software tools like Evothings Studio allows Java Script developers to pull together mobile IoT prototype applications based on the hardware in a couple of hours. With these easy to use tools for normal web programmers in place I believe enterprises and governments can and should bring home IoT prototyping - very rapid and affordable prototyping will help organisations to figure out how to leverage IoT in their organisations much earlier that their competitors and make them winners in the market. Adding connectivity, data analysis, cloud computing and a security/privacy policy will make them ready for launch and success. 
 
I stick to my previous view that our baby will be grown up, but still young, 2016 after only three years as teenager. Good enough technology and infrastructure are in place since a couple of years and when organisations started to go from Powerpoint and plans to trials and pilots we reached the teens two years ago. Four things have been missing to leave the teens behind: solid participation from the IT players, a hot M&A market, active and seriously engaged enterprises and efficient easy-to-use prototyping tools for users of IoT.
 
So where are we today on these four missing things: Most IT companies are now very active - hands on - in IoT including Amazon WS, Cisco, Intel, Apple, Google, IBM, SalesForce and MicroSoft. Others communicate their interest and focus on IoT quite loudly but have to show up with relevant value propositions, backed with resources, references and investments, in order to become attractive. I can't mention an IT consulting company who don’t claim brilliance in IoT but interestingly enough enterprises as well as start-ups are generally quite skeptical to bring the IT consulting firms along and the argument I hear most frequently is that most IT consultants are generic and lack solid and attractive references on exactly what the customers want to do. The one consulting company I must mention though is PTC who combines a couple of aggressive IoT acquisitions with their legacy industry consulting in a powerful play. GE announced their billion dollar investments in Industrial Internet already 2-3 years ago, IBM announced in April that they will invest 4B$ over 4 years to build a new IoT unit and Amazon, Cisco and Microsoft are investing “billions” to create cloud services supporting IoT. Then, finally, thousands of smaller consultants, app developers, creative agencies, digital agencies and whatever they call themselves are working hard to figure out which role to play in the emerging IoT market. Over the year we will see much more activities from the IT players and the IT industry will be ready to support an adult IoT industry 2016. 
 
The M&A market for IoT companies has definitely developed rapidly. We have seen a series of large acquisitions starting 1,5 years ago with the Thingworx and Nest acquisitions and by now all categories of investors are making bets in IoT companies. In Sweden alone a number of IoT start-ups have been closing seed or A rounds lately including Springworks, Senionlab, Evothings, Watty and Imagimob. And it looks more or less the same in EU and the US. The M&A activities and investors appetite in IoT definitely support an adult IoT market by 2016. 
 
Most enterprises are aware and interested in IoT today, but still quite few have gone beyond prototyping and PoC. I believe it’s primarily questions around internal processes, security, market readiness and timing that prevent them from getting going and I continue argue that prototypes to play with in-house and together with customers and partners is the best way forward to get a handle on these issues. A generic challenge for enterprises introducing IoT is the brutal transparency it provides. Instead of knowing that a truck has left to deliver goods at point A one could know exactly where it is, when it should arrive at A, how eco-friendly it is driven today, the maximum and minimum temperature of the goods, if it has been shaken a lot, the total weight of the goods, gas consumption, when next service should be scheduled to prevent service disruption, etc etc. Processes, systems and the organsation need to be prepared for this. 
 
I have already explained that tools supporting agile development of IoT applications, both hardware and software as well as mobile applications, are available now. On one hand many service enablers specialising in industries or functions, can often help develop relevant prototypes very quickly. When PoC is done they also provide a base case for how to make a complete application. On the other hand, easy to use hardware and software tools are available today and enable organisations to develop their prototypes in-house. My most common advice to larger organisations is to form a small in-house prototyping team with a couple of web developer-style persons serving the entire company with prototypes. Tools for efficient prototyping, development and maintenance of IoT applications including mobile will definitely be in place to support a grown up IoT industry by 2016. 
 
The connectivity infrastructure for IoT is already good enough but there are several commercial and technology efforts ongoing to make the situation even better. Bluetooth Low Energy has become a very important enabler especially for mobile IoT applications and with the most recent $115M investments in place Sigfox got the muscles to start roll-outs of their narrow band IoT network in many more countries (most recently Denmark and Belgium was announced). The connectivity side of the equation is already now available to support a grown up IoT industry by 2016 but there are continuous developments to make it even better. 
 
Most operators were early entrants in the IoT industry and with quite similar approaches across the line. But over the last year or two many of them have started to follow their own paths. KPN for example pulled back to Holland and focus on excellent roaming offerings, Tele2 on connectivity and partnerships, Telenor Connexion acquired an end-to-end IoT application development platform and were the first to use both Ericsson’s and Jasper’s provisioning platforms and TeliaSonera just invested in the user centric IoT developer Springworks. Enterprises will have to optimise their investments regarding things like integration, geographical coverage, traffic cost, performance and market attractiveness why operators with different approaches is good news. Enterprises will avoid integration with both EDCP and Jasper why operators using both, like Telefonica, will be more common. This is yet another good development which will help IoT to grow up and the operators will be ready to support a grown up IoT industry 2016. 
 
Finally, when organisations want to take position in a new complex market, one where it is not enough just to launch a new gadget, it often becomes partner programs, competitions for start-ups and alliances. It’s nothing wrong with that but I have never seen as much activities in these areas ever before which I interpret as growing momentum for IoT. And since all start-ups need to develop their solutions together with paying customers, too much chasing and collection of funds from elsewhere might make them loose that essential customer focus. 
 
I believe all things needed for IoT to leave its teens 2016 are developing well. Remember that the key difference between when Internet of people and organisations was created and now when we are adding things to the Internet is that ignorance will not be an acceptable excuse. So lets get going!
 
Enjoy! 
Magnus 
 
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