Chasing the white whale of the Internet of Everything (IoE) ‘killer app’ is confusing some of the best organizations as the investments add up and expectations grow. IoE is based on mobility, big data and analytics, sensors, people, places, things and well…everything.
This means, in a digital world, the traditional notion of a killer app has been replaced by the drive to create value by connecting the digital bits in many, many different ways. While the notional killer app drove sales in software, hardware, gaming and consumer devices, today’s IoE markets have become roadmaps of challenges.
This is because end users constantly adapt and innovate business models, technology and IoE capabilities to grow a long tail* set of solutions to address the seemingly endless list of challenges.
We all agree IoE is going to be huge, and even if we can’t agree on the numbers, what’s a few billion between friends? Whatever the size at any particular point in time, no single market sector, industry or application is going to account for the majority of it –rather, it will comprise an ever-longer tail of applications. And of course various applications’ proportion of the overall IoE will grow and diminish as things progress.
For instance, as homes, factories, neighborhoods or cities get smarter, applications will multiply and become more granular. A simple example is that already some cities are moving from turning the street lights off at midnight to save energy and money, to being able to control individual street lights. Eindhoven in the Netherlands is doing this to light the journey of pedestrians or cyclists as they pass by, improving the safety of individuals, while still saving resources.
Adjust and adapt
This week the big noise is about smart stadiums and wearable/sports apps, next week it could be smart socks. Business models and technology around connected cars could be the latest in in-car entertainment or cars being able to talk to each other, such as to warn of an icy road ahead. Yes, the big, overall category is mobility, but the go-to market solutions and services are dynamic – always changing.
Put another way, there’s no end-game – no end state for IoE, no ultimate set of business or consumer products. Instead the three pillars of IoE – business models, market expectations and technical capabilities – keep changing. We need to understand and accept that this is how it is and how it’s going to be, then adjust our thinking and adapt.
Some companies have grasped this already; for instance, Amazon epitomizes the philosophy of selling less of more, morphing from a bookstore to create a third-party marketplace. It also offers cloud services, provides devices, makes its own TV content and is developing drone technology to improve its deliveries, to name just some of its ventures – all part of a grand plan to build and strengthen its expanding ecosystem.
It also explains why IBM recently acquired the Weather Company – because the weather affects almost everything, from agriculture to zebras’ migration. The demand for energy, water, commodities and services are strongly impacted by the weather. The Weather Company’s location database is bigger than anybody’s except Google’s. How long a tail can you get?
According to the Wall Street Journal, IBM paid over $2 billion for the acquisition. If you really think about the number of potential applications, this looks like a bargain, given that a lot of them will be worth a lot of dollars, even if they are a drop in the overall IoE market.
The roadmap of challenges
I have Cathelijne Hermans, Head of Clusters and Projects, Amsterdam Economic Board, to thank for framing the situation nicely. She pointed out to me that we need to stop talking about systems and solutions, and focus on developing a roadmap of challenges and how to address them.
And the more I’ve thought about this, the more I like it – no application alone will be a trillion-dollar market, it’s the grouping of them that will be the trick.
The trillion-dollar question is how to respond to the unprecedented size, scale and variety of the IoE opportunity. TM Forum’s response is to look at setting up an incubator of challenges by modeling business scenarios and their associated hurdles. Then we can plot them into roadmaps or a repository of challenges for others to understand what the challenges are, how they might develop, and figure out appropriate responses. Most importantly, this will be done collaboratively – the only possible way to address this opportunity.
This is a different approach – for instance, previously we might have looked at identity management as being a solution looking for a challenge, now we need to turn that on its head, drawing input from a crowd-sourcing approach – which is what the Forum excels at. Let us know what you think! You can contact me directly via [email protected] or in the comments below.
*Although the idea of the long tail is thought to originate with Beniot Mandelbrot in the 1950s, the idea was made famous by a hugely influential article, published in Wired magazine in 2004, written by Chris Anderson. This was expanded in his 2008 book, The long tail: Why the future of business is selling less of more.