IoT a business perspective
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IoT: A business perspectiveCarlos Perez, PhD, MSc
July 19th 2017
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What’s IoT?
The market landscape
Technologies supporting IoT
Applications: B2B & B2C
Business models
Security, data protection and ethical issues
What does it take to starting an IoT company?
A business case: Johan sports
What’s next?
Outline
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What’s internet of things (IoT)
"The transformation of any physical object into a digital data product“
Matt Turck, VC
Expectations:• $4 – 11 trillion in economic value by 2025
• 127 new devices connected every second
• 21B objects connected by 2020 (6.4M in 2016)
Source: Gartner, McKinsey
NEW Actionable
Information
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The IoT hype cycle
Drivers:• Data analytics
• IoT services
• Standardization & security
• Cheap HW and development
• Edge computing
• Battery lifetime management
5-10 years to become mainstream
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Technologies 1/2
Thing:Sensors + Arduino + raspbperry Pi
Protocols:MQTT
HTTP
Transmission:Zigbee
LPWAN (SigFox, LoRa)
5G
Arduino UNO17€
Raspberry Pi 335€
+
Temperature sensor5€
+ = 57€
Integration cost (€/MM)
SigFox extension board for Arduino54€
Tx costs: 0.7 – 8€/year @140 msgs/day max
= 54€
HW cost = 111€
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Technologies 2/2
Data collection & analytics:Cloud based (€/h)
Application:SaaS
Mobile
Data visualization:Existing solutions (€/user)
Development cost (€/MM)
~ 25€/month/user
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Applications: Overview
B2C B2B
Sorce: Gartner
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Applications: B2C
4M objects sold in 2016 (63% of objects sold)
$546M in value (2016)
Drivers:• Easiness to use
• Perceived usefulness
• Price tag
Trends:Toward the “Quantified Self”
Health care & wellness
Energy consumption mgt
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Applications: B2B
Drivers:• ROI
• Security
• Standardization & Integration
Trends:• Deliver new insights leading to better
decision reducing costs, increase revenues and reduce risks
• Expected pay-back time: < 3 years
Sorce: Gartner
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Only 1 key success factor: The OS
Those who own the OS, own the ecosystem and own the market
Video link
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Applications: Biomass CHP plant
Power: 150MW
Investment: 250M€
Operation lifetime: 20 years
Expected ROI: 5-10%
Yearly revenue: 120M€
Yearly costs: 84M€
IoT gain: 1%
IoT gain: 840k€
IoT ROI improvement: ~3%
1% cost reduction translates into +3% ROI
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IoT Business Models
The industry is immature and hasn’t found yet a viable BM
Data is not knowledge anymore, data is money
The data is at the core of revenue streams: B2C, B2B…but not always visible to users
Market startup(2012 – 2015)
Market up take(2015 – 2020)
Market maturity(2020 – 2025)
Sell the device• Higher price tag than not connected objects• Setup is still not simple enough• Compatibility issues with other devices• Major security issues• € from one-shot sales
Sell a new service• Appealing mostly to early adopters• ROI/benefits not proven• IoT services: Try and error• € from recurrent revenues
Sell new offers from current services• Appealing to mass market• A Company owns , operates and manages the device• Devices becomes a comodity• Stardardization of interfaces• Data protection, ownership and management regulated• € from personalized services
€
€€
€€€€
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Security: A major feasibility requiremet
A major Go/No Go for IoT services
Security by design:• HW• SW• Tx (no protection: 75% of devices) • Access to devices• Data storage• End to end applications
Sensible personal data are fully exposed
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Data protection & ethical issues
B2C: Who owns the personal data:
• The person• The device maker• The company operating the device
Today, no legal framework defines who owns the data and the dos & don’ts
A major condition for B2C mass market adoption
1996: HIPAA1998: Safe Harbor2013: FDA
FTC
1995: EU directive 95/45/EC on the right to access and manage the collected data
1978: Loi Informatique et Libertés (Art 34) on personal data protection
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What does it tale to start an IoT startup
SW startup IoT startup
MVP develoment approach YES YES
Protoyping budget 100k€ >250k€
Prototyping delay A few weeks >24 weeks
Mechanics NA 10-30k€
Electronics NA 10-20k€
Packaging NA 4.5-15k€
Parts sourcing & materials NA 8-10k€
Other engineering (e.g. security) Variable 10-20k€
Industrialization budget 500k€ >1 000k€ (5 000 units)
Fabrication delay 24 weeks >14 weeks
Certification delay NA 2-4 weeks
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What does it tale to start an IoT startup
SW startup IoT startup
Logistics NA Very expensive
Stock management NA Mandatory
Commerciallization SaaS, Apps PoS, online
Revenu sharing with retailers Optional Mostly mandatory
Launch delay and required funding:
SW startup: ~27 weeks, ~600k€ vs. IoT startup: >42 weeks, >1 250k€
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Sport data analytics: State of the art
System installed and never moved: A complex system
High positioning accuracy based on GPS with correction: mm
Very expensive: starting at 1M€ each
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Sport data analytics: Johan Sports
1. Track your activity 2. Analyze results 3. Improve your game
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Sport data analytics: Johan Sports
Johan Sports video
Sensor: A few tenths of € each
Whole system:A few thousands of € each
Open new markets:• professionals• amateurs• Individuals 20 clubs, 484 sensors deployed
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What’s next
Technology:• Bespoke processors• Data analytics on a $5 board• Making current objects smart• Energy harvesting
Security & data protection:• Adoption of security by design• Regulation for data protection and
ownership
BMs:• IoT as a service
openMSP430 µcontroller - FPGA
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Sorce: SIGREF
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The IoT trends:http://www.gartner.com/smarterwithgartner/7-technologies-underpin-the-hype-cycle-for-the-internet-of-things-2016/
Technology:https://store.arduino.cc/arduino-uno-rev3
Johan Sportshttp://www.johan-sports.com/
Catapult sportshttp://www.catapultsports.com/fr/
GPSportshttp://gpsports.com/
RESSOURCES
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www:
https://www.carlosperez.biz/
e-mail:
LinkedIn:
https://www.linkedin.com/in/carlos-perez-msc-phd/
Twitter:
@egma1976
Contact
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The most popular HW platforms
Arduino
Raperry Pi™
Intel® Galileo
Intel® Edison
Beaglebone Black
UDOO
Parallella