Moving up the Internet of Things Value Chain

Fragmentation == Opportunities

I reckon that I don’t need to make an introduction about the Internet of Things because there are enough resources out there to explain what it is and also the opportunities around it. Thus far the market seems highly fragmented as there are a number of players operating within the IoT space without directly competing. This condition typically appears for new business or market during its nascent stage. Competition usually heats up as the market develops and matures. However the key differentiator for a successful company is to identify the market opportunities early on by being “customer-obsessed” to the point that solutions would encompass many stages within the IoT ecosystem. Such are the opportunities that lie within the IoT value chain.

The Internet of Things (IoT) solutions are very fragmented, they are either custom and unrepeatable or incompatible with existing infrastructure, with incomplete and unprotected data access and insights. Fragmentation is both a challenge as well as an opportunity. This blog post describes how a typical IoT vendor be it a device manufacturer, solution provider or system integrator can move up the IoT value chain by taking advantage of these fragmentation opportunities and offer a proposed solution in the form of an IoT Services Platform to its customers and partners.

Opportunities

The goal is to ensure that your company becomes the device manufacturer or SI of choice among customers and every player within the IoT value chain. More players are anticipated along every stage in the IoT value chain. IoT players would have a healthy relationship of collaboration, competition and dependence on each other along the value chain. Customers are highly dependent on data, information and insights. The success criteria is fast time to market, repeatable IoT vertical solution that meets customers’ business objectives.

Tremendous value could be realized from the following simple chevron process:

iotchevron

In the following examples, I am painting the picture of how an IoT device or module manufacturer can provide value in each of the process above.

  • Be the de facto module/device manufacturer by helping new entrants achieve faster time to market, be it a managed services company, a cloud platform IoT provider or a CRM/Big Data analytics company. This promotes dependence on your modules and devices. Successful partners would influence the sales of the modules and devices.
  • Provide a modular approach to helping these new entrants build their customised IoT vertical solutions using your IoT Services Platform. Basically avoid reinventing the wheel and allowing more time on product and solution innovation. Overall this is all part and parcel of building a healthy IoT ecosystem.
  • Upsell consulting and premium support services to System Integration partners who require help, guidance and support to integrate with the IoT Services Platform.
  • Architect the IoT Services Platform as a gateway of telemetry collection being able to process large-scale telemetry data streams generated by the devices and hardware developed by yourself, but beyond that manage other devices and services too.
  • Data is not the only raw material being unlocked by the IoT it is also the ability to perform command and control of devices.

As a result of taking advantage of these opportunities

  • Recurring revenue through a subscription model.

o   E.g., a vertical IoT software platform partner can subscribe to the IoT Services Platform to enable the ingestion of IoT device telemetry streams. This especially makes sense because of the large-scale telemetry data streams and equally high-volume of instructions that needs to be communicated to the devices in the field.

  • Win-win Partnership models – solution partners pay as their business grows
  • A vibrant partnership ecosystem whereby more IoT vertical solutions are launched into the market with reliance on your modules/devices or the IoT Services Platform.
  • Be what’s next in “Product Relationship Management”, it’s beyond buzz words such as CRM, Big Data or BI.

 

What an IoT Services Platform may look like?

IoTServicesPlatform

 

An IoT Services Platform offers a services & software platform to help customers and partners gain new insights, optimize business processes, make more informed decisions and identify new revenue opportunities. The platform performs the heavy-lifting and plumbing services such as IoT device management, telemetry collection, interactivity, notifications, servicing, etc. This would remove the barrier to entry for many IoT players, allowing them to just focus on IoT vertical solutions.

More importantly, having this platform allows an IoT provider to actively pursue IoT verticals such as smart metering, eHealth, Building Automation, Digital Display, Light Industrial scenarios. It allows it to customise solutions to meet individual customer requirement. It also promotes the best of breed partnerships as it continues to partner with large, established IoT players to deliver solutions in various verticals such as utilities, transportation, healthcare, government and consumer.

 

Business Model

The business model of this platform is one that relies on the success of IoT market which is huge. Monetization is based on the following business models:

Consumption model

  • Pay-as-you-go allows broader, wider adoption among smaller players in the IoT ecosystem

Subscription model

  • Allows medium and bigger players to leverage the economies of scale of this platform by committing to subscription contracts.
  • Provides good recurring revenue.

Premium Consulting and Support Services

  • Pay per support incidents
  • Support contracts with enterprises and medium to big business partners

 

Summary

Many existing IoT providers have the first mover advantage in the IoT ecosystem. It can continue to extend such an advantage by taking its lead in moving up the value chain. Such a move does not necessarily compete with its partners because it addresses the opportunities which could be leveraged by any player within the IoT market. By providing an IoT Services Platform whereby products, solutions and innovation from any player could thrive within the IoT market, the ecosystem becomes larger and healthier. One company getting a bigger slice of the proverbial pie is one thing. However a bigger pie is everything.

An IoT Services Platform serves as a great framework and also infrastructure for either custom or repeatable IoT vertical solutions could be engineered. This brings a two-fold benefit because it promotes dependence and loyalty on its solutions or hardware modules and devices. This bolsters its existing hardware business. The next opportunity is to take advantage of new business models described in this white paper to leverage new revenue streams which are recurring in nature.

This is all part and parcel of moving up the IoT value chain.

GetFitY’all – More about a project on the Internet of Things using Microsoft Azure

More on my Internet of Things project, GetFitY’all.

  1. I exposed 2 RESTful endpoints and just to prove that Azure “loves all, serves all”, these endpoints were implemented as a node.js app. In my previous “life” I was considering a few API proxy platforms, so I deployed an API proxy that hosts these endpoints. But then these endpoints could easily be deployed onto a simple and free Azure Web Site. Next candidate should be the Azure API management feature.
  2. These 2 endpoints perform these simple tasks:
    1. Mashup on demand – Let client apps consume a mash up of fitness activity data points from different target APIs based upon user ID and time period for a specific date. This has to be real-time and on demand although the mashup does take up quite a bit of computational time.
    2. Automated message pump – Generates a message pump that pulls fitness activity data points from different target APIs, and sends as AMQP messages asynchronously to Azure Event Hub. This is meant to decouple the processing of these messages from the message pump. The message pump endpoint could be fired up based upon a set schedule in Azure Scheduler.
  3. Publish these endpoints, it will return you valid JSON or XML depending on the HTTP Accept header.
    1. GET /v1/getfityall/mashup – no query strings to make things simpler based upon known parameters that return an activities mashup.
    2. POST /v1/getfityall/msgpump

Actual endpoint URLs to be updated later… this is the placeholder.. watch out…

  1. To further demonstrate that PowerQuery and PowerMap are good to consume data sources directly from API proxy endpoints, I’d created another spreadsheet, and this time it is for a mashup of how I got to Mobile Monday Sydney, a meetup I attended on the first Aug Monday evening, it was fun to get to know the community here. The skyscrapers are thinner now, and click the play button to see my routes.
MoMoSy-mashup
MoMoSy-PowerMap visualisation

Microsoft Azure + Office365 Power BI == Power to the Internet of Things

Here’s a sneak peak of what I got. The end result is the ability to do self-service analytics on my daily activities by doing a data mashup of Fitbit and Strava activity data points. This is not really enterprise-grade, just a fun personal project, but in later posts I will discuss more about making it more “enterprise-grade” by decoupling all the mashing work to an Event  Hub and Azure Worker Roles. Sure I’ll even defend why I use this later but don’t beat me too much to it.

I just want to be able to do some self-service analytics using Excel 2013’s new add-ins called PowerQuery and PowerMap. Why Excel? Well because I have it and I think it’s rather ubiquitous.

Why Fitbit and Strava? Fitbit One is a device I carry with me all the time, and Strava is an app which was intended for cycling (because I’m an avid mountain biker) but I use it a lot and I am glad that this app is really power-friendly in not draining off my smartphone battery when I record my activities.  So the simple task is to create a IoT gateway proxy with 2 endpoints, but let’s just start with the first end-point which is the following:

GET /v1/mashup?ondate=YYYY-MM-DD&aftertime=hh:mm&beforetime=hh:mm

I’ve not turn the endpoint live yet in the cloud will do so soon.

The end result, a visualization of where I spend my activities, when, and how. This is the PowerMap, very powerful indeed. Those skyscrapers in the map below are not new building in Sydney but rather a representation of my steps count as recorded on Fitbit and the lat/long coordinates recorded by the Strava app. A quick tour of what I did a few Sundays ago:

  1. Skyscraper #1 – I left my apartment in Waterloo/Redfern area, walked to the bus stop with my family
  2. Skyscraper #2 – Alighted at Central station, walked to the other side of the station to catch another bus
  3. Skyscraper #3 – Got off at Parramatta Road to go to a kid and baby Sunday market, can’t remember the name of the place but from the map it’s somewhere near Barnwell golf course. This kind fits the purpose of why I build this, to remember where I’d been considering I’m really new in Sydney.
  4. Skyscraper #4 – After much shopping for kid and baby stuffs, we were starving, so we went to Westfield Burwood for lunch
  5. Skyscraper #5 – Did some groceries around the commercial area near the Burwood train station
  6. Skyscraper #6 – Walked back to apartment from the bus stop
Family Sunday Funday
Family Sunday Funday

Here’s the Excel spreadsheet which packs all these goodies, but the actual data is pulled from Azure Storage tables.

Just download these two add-ins to get started.

PowerQuery – http://www.microsoft.com/en-au/download/details.aspx?id=39379

PowerMap – http://www.microsoft.com/en-au/download/details.aspx?id=38395

The brains behind all of this: it’s all in Microsoft Azure. I’ll just quickly summarize the technologies I used:

  1. Cloud services – virtual machines to be exact
  2. Azure Service Bus Event Hubs
  3. Azure Worker Roles
  4. Azure Storage tables

You can take a look at a rough sketch of the architecture below:

EPSON MFP imageDisclaimer: I’m not an enterprise architect, just know enough to get a quick IoT POC moving.

Hope you like it. My next step is to tighten this up and I’m also exposing this as a well-designed RESTful API, hopefully.