IoT–Exploring the next big thing in mobile

IoT–Exploring the next big thing in mobile

Internet of Things (IoT) has been hailed as the next big thing in the mobile industry. As connections from objects and things interconnect with existing and new end points, the networked effect can provide tremendous opportunities, reshape existing processes, user experiences, and expectations. But, really, how real is IoT and what will it take to reach the billions of dollars promised. Will it fundamentally alter how we do things? We are starting to see signs of tremendous progress. GE is investing $4B+ into its version of IoT – the industrial Internet and it is making the difference in operations and machine learning. Connected consumer gadgets are enabling us to lead healthier lives, work more efficiently, and manage our time more effectively.

Chetan Sharma Consulting hosted the first Mobile Breakfast Series event of the year in Vancouver and we delved deeply into the subject of IoT and what it means. We talked about the opportunities it represents, the challenges it faces, and the timeline for success. The panel took a look at the fundamental elements of IoT that will be a key layer for the Connected Intelligence Era.






Shahid Ahmed is a Partner at PwC where he leads the Emerging Technology and IoT Practice. Previously, Shahid was the Managing Director with Accenture, where he had P&L responsibility for North America’s Communications business.  In this role, Shahid helped telecommunications clients build new capabilities, operate more efficiently and drive new growth.  He was also responsible for the Network practice in North America.  During his twenty-year tenure at Accenture, Shahid was involved in creating many practices including the formation of the Wireless Practice and helping to start the Accenture Cisco Business Group. Prior to joining Accenture, Shahid held several management positions at Sprint where he rolled out and expanded Sprint’s cellular services in North America.   Shahid was also responsible for rolling out the first cellular digital packet data (CDPD) capability in the US. Shahid is an active member of several wireless industry groups. He currently serves on multiple Advisory Boards such as the Smart Network Council, Cellular Telecommunication and Internet Association (CTIA), Northwestern University Masters in Engineering Management (MEM) Program and The Coral Group. In February 2011, Shahid was appointed as an Advisor to the Federal Communications Commission (FCC) Technical Advisory Council advising on technology issues facing the United States.  Shahid was chair of the M2M/IoT working group and currently chairs the cyber-security working group.

Rob Tiffany is the Global Technology Lead for the Internet of Things at Microsoft where he’s shipped smartphones and architected + developed many of the world’s largest enterprise mobile, IoT and wireless solutions. Prior to Microsoft, he spent his career as an entrepreneur, executive, strategist and writer of bestselling books on mobile and wireless technologies. A pioneer of the mobile revolution, he drove the development of the mobile app ecosystem and co-founded the world’s first cloud-based, mobile device management company. He started his career in the M2M business in the early days of wireless, bringing unintelligent vending machines to life.

Gonzalo Tudela is CEO and Co-founder of Vandrico Solutions, an enterprise wearables software company based in Vancouver Canada. With a background in Finance and Mining Operations, Gonzalo is an early champion of the positive impact wearable technology will have on large commercial operations. His insights have been featured in publications such as The Globe and Mail, Entrepreneur Magazine and TechCrunch. Gonzalo is a TEDx speaker who regularly presents to business leaders across the world. His expertise has been televised internationally to millions of viewers on the Globo TV network and on CBC. Gonzalo currently leads Vandrico in helping large global organizations use wearable technology as a way to overcome safety and operational challenges.

Rob Chandhok currently serves as President and COO of Helium, which provides a complete Internet of Things platform that makes sense of your things. Prior to Helium, Chandhok served as president of Qualcomm Interactive Platforms and senior vice president of Qualcomm Technologies Inc., where he was responsible for Qualcomm products and strategies that enabled people to benefit from the Internet of Everything, including wearable computing, vision-based computing via the Vuforia augmented reality platform, and the AllJoyn software development framework, an open source project of the AllSeen Alliance. Chandhok has years of practical and product-oriented experience in wireless communications and the Internet. He takes a systems-level approach to innovative communication oriented products, from chips up to applications and user interface. Chandhok holds 36 patents and has 23 published articles.

The highlights of the discussion were:

· Shahid was just back from the big Hannover fair in Germany. He gave a good overview of the emerging movement towards of what is being called Industrial 4.0 essentially a derivative of Connected Intelligence. Industrial nations like Germany and Japan are very worried about staying relevant in the new economy. It’s worth reading the official summary here. US was the showcase country this year so there were plenty of representation from US tech giants like GE, Intel, Microsoft, AT&T, and many others. Even President Obama took time to represent the US interests at the show. The bottom line of the show was that everything is getting connected, really fast, and the change is coming faster than we can think. There were several case studies that highlight this as we will discuss below.

· Rob Chandhok has cut his teeth in the mobile ecosystem with years of experience building technology and ecosystems at Qualcomm and is now shepherding Helium to become a contender in the IoT space. Fresh from raising a $20M round with GV and the likes, Helium is making good progress in that dimension. As he stated on the panel, Helium wants to become Android of the IoT world.

· Rob Tiffany started his career in the M2M space building vending machines that could communicate and help with the operations but as he leaned all too painfully, it is not about the technology but also about the human element that we need to be always cognizant of it.

· Gonzalo’s background is in mining and he is connecting the mining world to IoT and vice-versa and is in the process building out a platform that can be applied to many other use cases but the focus is on how to make things better, safer, workers more productive, operators cheaper and effective, and the ROI a no-brainer.

· While the news headlines are captured by the likes of consumer gadgets and gizmos, almost all of the revenue and profits is in Industrial or Enterprise IoT and that’s where we focused all of our attention.

· At the highest level, the main goals of IoT are one or more of the following: to reduce cost and expense, reduce risk, increase productivity, enhance consumer engagement which results into higher revenue and better profitability, and obviously at the end of the day – increase revenues with new revenue streams or new business models applied to the old businesses or just doing a better job with the existing streams.

· Product companies are turning into services companies. IoT is also enabling new business models. The prominent examples are: Rolls Royce and GE are leasing their jet-engines by the hour rather than selling them so that they can very accurately predict the maintenance windows and maximize usage by reducing downtime costs. It has led to increase in revenue and best margins for the business.

· Many folks in the industry view IoT as dumb endpoints to collect data but clearly there much more to it. Even sending control commands to manipulate the outcomes are a big step forward. However, the clear benefits come when the end-points are smart and are capable of making decisions. In the case of Helium sensors, software can be updated over time. In fact, if the sensor is not software upgradable, you shouldn’t even consider buying the sensor. As such, some of the new low-power networks like Sigfox and Lora are a non-starter in the long-run because they just don’t have the bandwidth to send updates to the end-points efficiently. I think the role of these two networks is similar to that of WiMax. It helped accelerate the LTE evolution. Similarly, SIgfox and Lora spurred the growth of NB-IoT and the ecosystem around it is being built quickly.

· Another great example is from RioTinto – they have dozens of mining operations around the world and operate heavy equipment. With the help of sensors, they are able to operate autonomous vehicles. In fact, RioTinto is the world’s largest owner and operator of autonomous haulage system trucks. By operating autonomously, more material can be moved safely and better yield is delivered.

· In the underground mining operations, Vandrico equips miners with off-the-shelf wearables and the data from the sensors is used to provide specific instructions based on the type of work, location within the mine, and other contextual factors that need to be considered in real-time operators.

· This leads to how the business model should be designed. More and more folks are thinking about value-based pricing. The communication piece in IoT is practically a commodity and so the value is in the outcomes. Gonzalo brainstormed some interesting value propositions that he is thinking about for e.g. pricing based on lives saved or extra production of the mineral (in case gold, copper and other valuable minerals, one can hit the jackpot).

· Microsoft has a number of good framework elements that can be used for IoT like Azure cloud, Analytics, BI, real-time event processing of high volume, etc. With Amazon, Microsoft are the two giants in the IoT cloud space.

· The IoT stack is very fragmented and it will continue to be such for a time before some consolidation takes place.

· Opex of IoT devices/network is generally bigger than the capex.

· Security is of course a big deal in IoT. Some think about it all the time but in general there is a big gap in the industry. Regulators are slow to move as well. Perhaps a big public fiasco will force the industry and the regulators to come up with guidelines and rules that can be enforced. Just because you can encrypt data doesn’t mean you are securing the data from the sensor. The fact that it is emitting data (garage opener) can be captured by nefarious elements. Encrypted data is of no use in such scenarios. So, as an industry, we need to take a much deeper look into how we deal with security and privacy of IoT data and end-points.

· BP provided fitbits to their employees and saw a 44% reduction in sick-days. That’s enormous amount of hours that can change how the business is run. It will also have a ripple effect on the fabric of society – insurance, health care facilities, education, social security, etc. will all be impacted.

· Gaming might provide some interesting business model lessons for IoT.

· In the end, Industrial IoT is about managing business outcomes to impact the basic operating metrics of the company and the ecosystem.

· The threat of cybersecurity looms large and we just don’t have the integration, collective framework to even start tackling the problem. Lots of challenges and opportunities to tackle this.

· There are big differences in expectations of IoT solutions in the developed vs. emerging worlds. Pricing is the biggest variable. As such companies operating in the space had to adjust their pricing models to suit the market and make it more palatable to the markets such as India and China.

· It was kind of reflective of the state of the industry that we didn’t talk much about the mobile operators who dominated the industry until 2010-11 and are slowly becoming less relevant in the 4th wave era (more to come on this). Of course, there are a few operators like AT&T, Verizon, Vodafone, Telefonica, and DT who are quite active in the space not only at the connectivity layer but actually on all layers of the stack. However, their best opportunity might be managing the OSS stack for the Industrial world.

Overall, it was an excellent panel with diverse viewpoints covering a technology evolution that is just getting started. It is exciting to be part of this shift and help shape the conversation which is bound to have a fundamental impact on the global economy. My thanks to our sponsor Optimus Information for their support, all the speakers who traveled great distances to be with us, and to the attendees who took out their morning to be with us. Everyone was glued to the discussion and the time flew by very fast. And we barely were able to scratch the surface. We will continue the dialog in the coming days, months, and years.

Our next opportunity is our Mobile Breakfast Series in Seattle on June 7th where we will add 5G to the mix and explore where are the opportunities at the intersection of 5G and IoT. We will look into what the new world of 5G will look like and how it will impact IoT.

As always, we welcome your input which helps in planning future forums and brainstorm sessions.


Chetan Sharma