The Internet of Things is only going to get bigger this year. Ryan Lester, director of IoT strategy at Xively by LogMeIn gives his thoughts on the connected devices market
2016 was a great year for the IoT. We saw a huge spike in IoT products hitting the market and more interest from product companies looking to move into connected product companies than ever before. So where will 2017 take us?
Towards the end of this year, we saw less and less use of the term “IoT” in favor of more descript – “connected” products, devices, wearables, etc. The Internet of Things is a really broad term that actually refers to the full network of IoT devices – not the devices themselves.
As companies began to develop for the IoT, it was the best way to describe it. Today, we are seeing vendors and product companies moving away from that term and focusing more on their specialisation as opposed to the whole ecosystem, and we’ll see more of that.
It’s no secret that security breaches this year dominated many IoT debates. While the most recent security stories focused on older IoT devices like routers and DVRs, it was definitely enough to get the whole industry talking. These conversations pushed security up to the top of the priority list (as it should be). In 2017, we will likely see these security concerns push standards forward and may see regulations as about privacy and data sharing.
We will also see security solutions emerge specifically for the IoT. IoT brings with it a whole new set of security challenges and security needs to be purpose-built, and that is a big opportunity for competitive differentiation for platform vendors as well as an opportunity for the entire security industry.
“IoT product companies rely less on initial purchases and more on recurring revenue opportunities.”
Ryan Lester, Xively by LogMeIn
Many companies have focused their IoT initiatives on simply getting a product connected to the Internet. It’s trendy, modern and distinctive as a competitive advantage, but it’s so much more than that.
As more and more companies get connected businesses up and running, the true benefits have begun to emerge. Traditional product companies rely on that initial sale with the hopes that customers will continue to upgrade over time.
IoT product companies rely less on the initial purchase and more on recurring revenue opportunities: subscriptions, upsell opportunities, etc. The key to making this happen is providing a killer customer experience and using the device data to better understand the customers’ wants and needs. Having deeper relationships with customers allows companies to provide a more personalised customer experience and additional revenue opportunities.
In addition, system integrators will become key partners for the vendor community, Alexa or something like it will emerge as “iPhone” for the IoT, and standards will be developed for networking interoperability.
Just as 2016 was predictable and surprising all at the same time and 2017 will be no different. Here’s to another successful year of IoT.
Ryan Lester is the director of IoT strategy at Xively by LogMeIn.