In 2017, across every boardroom globally, at least one executive asked the question “how can we capitalise on the emergence of the IoT market within our organisation?”
The development of IoT technology – from smartphones and mobile wallets, to virtual assistants and smart household appliances like lightbulbs and fridges – has created an incredible array of opportunities for companies to create new service offerings. The question is: which companies will be savvy enough to capitalise on these opportunities, and in what capacity?
With seemingly endless opportunities, many companies don’t know where to begin. The most important things to consider are how IoT can be linked to business strategy, how it can help businesses achieve their strategic goals, and where it might deliver the greatest business value. Leveraged in the right way, IoT can propel businesses towards achieving some of their loftier goals.
Here are 4 key messages to usher your carrier strategy into 2018:
Over the next four years in Australia, the Internet of Things is expected to grow significantly, with an expected jump in market value from 634 million AUD to 4.7 billion AUD by 2021. Currently, there is an average of 13.7 connected devices per Australian home, ranging from smartphones, tablets, and watches to computers, virtual assistants, speakers and refrigerators/washers.
IoT in the home and business will be an integral part of carrier’s success in 2018. With an explosion of devices and applications, it’s hard to know where to focus. Quite often, the market changes by the time a strategy has been implemented.
- Customer propositions must include seamless usage across the key devices, mobile, hubs, and gateways as one service
Core connected devices (smart hubs, hybrid gateways, and smartphones) will facilitate a broader adaption of IoT at home applications. With a current market penetration of 2.1 smartphones per household, and the vast library of apps related to IoT, the smartphone will continue to be the entryway to IoT device adaptation. While the smartphone is the entry to the connected home, smart hubs (or speakers) are the centre of the connected home. The smart hub connects ancillary devices, such as sensors, power plugs, and lightbulbs, making it easier to control most aspects from a central point.
Creating a market proposition that combines usage across these devices from a fixed and wireless network technology perspective will drive customer satisfaction, meaning a single service fee tailored to the customer’s needs that covers the entire home or business.
- IoT Benefits can be fully realised with advantageous partnerships
Service industries are now using IoT to reduce risk and costs. There are some insurance companies for example that give discounts to customers who purchase security packages, reducing the likelihood of theft and claims exposure. With a connected home base such as Google Home, Amazon Alexa, or Apple Home Kit adding additional security measures to an already connected home, it makes it quite easy to receive back-end discounts. Consumers have already proven they prefer low-price/high-value devices, the most popular IoT at home devices being lightbulbs (69%), video cameras (58%) and locks (56%). To drive a connected home strategy in 2018, carriers should be creating as many partnerships as possible in the security, electricity, and utilities spaces creating the best ROI scenarios for their customers.
- Driving Hardware-as-a-Service (HaaS) to create an extremely sticky customer experience
Common barriers to customer uptake are the upfront costs associated with purchasing each piece of hardware and replacement when they are obsolete. Consumers are moving away from the idea of ownership as it no longer makes economic sense. With a HaaS subscription, maintenance becomes the nuisance of the hardware provider as the consumer is paying not for the asset, but the service; making it that much more vital to create an experience that is tough to walk away from.
Just as ownership models are being challenged by leasing in mobile hardware, connected devices that provide a function in the home (like security) shouldn’t be offered as hardware, but rather as part of a service. In a connected world, when a piece of hardware becomes redundant, a replacement can simply be dispatched and installed without interference to the customer. The HaaS concept takes a single transaction and converts it into a lasting contract, redefining the relationship between carriers and consumers. In order to future proof their business models, carriers should reduce ownership of legacy items like modems, and look instead to bundle them as part of the service offerings.
- In an ever-connected world, consumers are hard-pressed to find a simplified customer experience
We live in an increasingly connected world, where consumer electronics and telecommunications services are merging. In most instances, for the majority of ISPs (Internet Service Providers) the more connected devices tacked onto a network, the slower the internet speed becomes. Over two thirds of consumers believe that Wi-Fi is crucial to successfully implementing IoT in the home.
The different standards and technologies for these services can be used in a diverse array of applications. For example, homes and offices can utilise Bluetooth and ZigBee to connect to smart lights and security cameras. Low power wide area (LPWA) coverages such as NarrowBand-IoT and Cat-M1 can be used in smart meters, and high data rate IoT services such as 4G and the upcoming 5G are more commonly used by consumers with their smartphones, computers, and tablets. Telecom operators are uniquely positioned to utilise customer device behaviour data and insights to provide customised solutions based on a customer’s device ecosystem preference, local network coverage and data usage requirements.
As the market matures, customers are more likely to stick with a provider that delivers the simplest point of entry to the many IoT connectivity technologies, from Wi-Fi to the upcoming introduction of 5G. By creating a truly seamless network experience that treats wireless as the standard and offloads to a fixed connection when required, carriers empower a forever connected experience.
It cannot be denied that IoT is making the future better, bigger and brighter. Though IoT is revolutionary in terms of what it stands for, to be able to make a sustainable impact carriers must be agile enough to forecast their consumer’s needs, before they want it.
If CES 2018 is anything to go by, Gartner’s prediction that the human population will be outnumbered 3 to 1 by interconnected “things” in 2020 will be a pleasant reality.