Post on 28-Jun-2020
Michael Gaudlitz
Regional Sales Manager IoT/Embedded
New Business Opportunities:Flexible Licensing Models in the Internet of Things
Tel: +49 89 894 221-191
Mob: +49 175 7272 455
Michael.Gaudlitz@gemalto.com21. Juni 2016
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The Internet
of Things
CONNECTIVITY
REAL-TIMEDATA
Technology EvolutionThe evolution of technology is driving the Internet of Things forward at a fast pace to make it a reality.
INTELLIGENTDEVICES
SOFTWARE
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Key Motivations and Enablers
TECHNOLOGYDEVELOPMENTS
Embrace new technologies to
advance your competitors
CHANGINGAPPLICATIONS
Anticipate changes in user
demands
BUSINESSDYNAMICS
Support new revenue stream
opportunities and business models.
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Software is the Enabler for IoT
CLOUD SERVICES
END USERAPPLICATIONS
DEVICES
COMMUNICATION
DATA
SOFTWARE
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Industry Trends
Jeffrey ImmeltChief Executive OfficerGeneral Electric
“The notion that there is huge differencebetween the industrial world and the softwareworld is no longer valid….those days are over.In today’s world, everything is software”
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Traditional and IoT-based ValueAs the Internet of Things spreads, the implication for business model innovation is huge.
To take advantage of IoT, device vendors need to fundamentally rethink conventional views and methods about value.
Value CreationIncreases the value of company’s offering
and encourages “willingness to pay”.
Value CaptureIoT creates a new mindset with focus on how to make money (i.e.monetization)
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Value Creation
IoT-based Value Creation
Products are no longer one-and-done.
New features are pushed to customers.
Usage tracking and response to customer behavior.
Traditional Value Creation
Resolution of existing needs in a reactive manner.
Manufacturing well-engineered devices that become obsolete over time.
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Value Capture
IoT-based Value Creation
Revenue is not limited to physical product sales.
Other revenue streams become possible after the initial product sale.
Team up with partners: understand how other ecosystem players make money.
Traditional Value Capture
Focus on selling the next device.
Includes potential commodity advantages such as brand valuation.
Business model relies on customer loyalty.
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Challenges for Device VendorsTraditional hardware centric selling models will challenge the growth of intelligent device manufacturers business.
Copy and IP ProtectionProtect products from illegal copies, reverse engineering and code tampering
Business Model VersatilityAdapt packaging and licensing models to meet evolving business needs and market trends
Lifecycle ManagementCentralize, automate, and manage operational and support activities across the entire licensing lifecycle
Manufacturing ControlEnsure product availability, control inventory , reduce manufacturing and certification costs .
System IntegrityEnsure your device is ready for the IoTecosystem and cannot be hacked or modified.
Product Usage InsightLeverage connectivity to gain full visibility into, feature usage, and consumable status.
Image for illustration purposes only.
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IoT Monetization Topology
BACK OFFICE
AnalyticsCRM
Entitlement Reporting
ERP
Reporting
Licensing
Provisioning
Deployment
Licensing & Security
Software Hardware Chip Cloud
DEVICES & PRODUCTS
Remote Capabilities
Enablement Upgrades Usage
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Security &Protection
UsageTracking Data
EntitlementManagement
ProductPackaging
Digital Product/Service
Software Monetization
Digital Business Architecture
Digital Product / Service
CRMSystem
Marketing Automation
Customer Interaction
CRM
Online Purchasing App
BillingSystem
PaymentMethods
e-Commerce
Monetization Opportunities for the Internet of Things
Business Models for IoT Vendors
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Monetization Opportunities
EcosystemMonetization
ServicesMonetization
DataMonetization
DeviceMonetizationTr
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Monetization ComplexityBasic Advanced
Types of IoT Revenue ModelsThere are four main revenue models.Companies can select one or more modelsto match level of complexity, business needsand the type of customer relationship.
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Device Monetization
How It WorksBasic transactional based product activation model.
Example: Operating RoomMedical devices being activated/updated from remote, function on demand
EcosystemMonetization
ServicesMonetization
DataMonetization
DeviceMonetizationTr
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Monetization ComplexityBasic Advanced
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Services Monetization
How It WorksAdding a service layer to a traditional product into by tying in a recurring pricing model for specific features.
Example: X-Ray MachineCharge per scan or maintenance call on a usage based subscription fee versus a “one
time sell” of the machine.Monetization ComplexityBasic Advanced
EcosystemMonetization
ServicesMonetization
DataMonetization
DeviceMonetizationTr
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Data Monetization
How It WorksOrganizations generate revenues by selling packaged data gathered from sensors.
Example: Traffic DataCompanies buy data about car trafficand sell information about traffic jam
EcosystemMonetization
ServicesMonetization
DataMonetization
DeviceMonetizationTr
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Monetization ComplexityBasic Advanced
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Ecosystem Monetization
How It WorksOrganizations create a platform and make money from other product vendors and end consumers.
Example: Industrial APP StoreCreation of a software environment thatallows integration of industrial controlapplications
EcosystemMonetization
ServicesMonetization
DataMonetization
DeviceMonetizationTr
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Monetization ComplexityBasic Advanced
Evolving Customer Demands‒ New applications are driving the Internet of
Things forward at a fast pace.
Business Transformation‒ The Internet of Things is changing the way
companies do business.
Revenue Opportunities‒ Companies can adopt various revenue models to
generate growth.
Key Takeaways
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