Charles Reed Anderson, Founder of internet of things (IoT) consultancy CRA Associates, presented his seasoned insights at TM Forum Live! Asia in Singapore last week. I caught up with him to ask about the challenges companies face as the IoT grows.
AM: With IoT still in its early days, there must be many challenges. Which ones stand out for you?
CRA: When I look at challenges I break them down into three separate areas: First is from an ecosystem perspective; second is security; and the third is the internal challenges.
On the ecosystem side, the biggest challenge is still vendor integration, and it’s been like that for a while. IoT is a lot more complex than people think. You have multiple products from multiple vendors to create a single solution; it’s very fragmented and there are no clear winners.
AM: What kinds of solutions are emerging to help with vendor integration?
CRA: It’s taking baby steps; there’s nothing that impressive so far. A lack of use cases still comes up as one of the major challenges. With the complexity of these ecosystems and IoT at large, everyone’s role is key. All the big ICT vendors, the operators, and just generally everyone doing something within IoT, are trying to understand their role in the ecosystem. They’re still developing partner relationships, and it’s going in the right direction. But it doesn’t happen overnight.
Security is still a major challenge, and if you ask me again in five years, years, it’s still going to be a major challenge. I’m quite cynical about this challenge, I don’t believe a lot of the hysteria surrounding it.
People blame security as the biggest risk but they don’t really know why. If you ask someone who says “IoT is insecure”, all you have to do is ask what endpoints they’re concerned about, what data in transit, what data at rest or applications. Turns out, they haven’t thought it through yet, and it’s because people don’t have huge budgets for this. Security is the one area they tend to overlook and they don’t come back to it until they’ve had a breach.
AM: Do they need to take a closer look then when it comes to security? Maybe help themselves and/or their clients get a better understanding?
CRA: All these vendors that have security practices. They should go out there and engage initially on security, build a template saying “we’re going help you talk about solutions and identify potential risks”. If the clients understand that upfront, it’s good for the vendor. It shows you’re adding value to the relationship. It’s good for customer in that it helps them identify what kind of budgets they need and the kind of company they’re going be partnering with.
So this is one where if you still ask people about it, you get a lot of wishy-washy answers. There are some good changes coming up; a lot of people are doing behavioral analysis on security.
AM: What are some of the internal challenges companies are facing?
CRA: Some of these remain consistent with general internal challenges. A skills shortage still comes up as one of the biggest ones. We expect that CapEx [capital expenditure]and OpEx [operating expenditure]is still up there. On a positive note, we asked providers the question: “Do you see a lack of senior management support as a challenge internally,” and for years this had been a very big “yes”, but now this “yes” has dropped down to only 18 percent.
Another internal thing is that providers are all freaked out about digital disruptors. They’re worried about one of them coming in and taking away their business. They scared, and don’t want to lose their jobs.
They need to be driving digital initiatives, and senior management is really backing this which is great. What’s bad is that this is still not driven as much within the rest of the group. Strategy and marketing are barely involved, and most importantly, the end users. There a statistic from Cisco that three quarters of all IoT initiatives fail, and this is why.
We can develop and deploy IoT solutions, but if you don’t get the end users involved and engaged, you run the risk of it not being adopted. This is what happened a lot of the time: They made it, it worked technically, but it didn’t actually fit their business processes, or was really what the end users that wanted.
AM: So you’ve been involved with emerging technologies for over 25 years. What kind of changes and trends have you seen over time?
CRA: I’ve been involved with emerging tech since back in the days of GPRS. I helped to launch Blackberry for 02 back in 2001-02, so I’ve always been trying to push emerging technology into enterprises. What I find fascinating is that we have the technology to securely deploy any solution we want; we can create amazing things right now.
What’s holding us back is the people side of things. We just don’t understand where the everything goes, how to work, how to collaborate internally with different vendors. And what we lack more than anything is people who can look at a business process or customer experience, and then backfill the technology. We still as an industry operate with the mindset of “I’ve got a widget you should buy my widget”. We sell kit instead of solving problems.
We’re never going to reach our lofty projections of 20-30 billion connections by 2020. Those numbers are made up by analysts trying to sell reports. In reality, if we don’t sort out our internal issues, we’re getting nowhere close to that.
AM: I’ve been hearing a lot about the disconnect between technology and business side of things? Is more focus and alignment needed here?
CRA: There’s a market niche for those who can sit between business people and technology people. I’ve been in that niche for a long time, and I’m absolutely stunned a lot more people aren’t doing it. Once you’re in there, you can talk to both sides of the table, and you become very valuable. We need more people doing this.
Stay tuned for a continuation of this interview in the coming month where Anderson focuses specifically on the state of connectivity for IoT.