Monetization Strategies For The Internet Of Things

1 CONFIDENTIAL Not For distribu4on All Contents © 2014 Aria Systems

Mone4za4on in the Age of IoT

Tom Dibble, CEO


Mone4za4on in the Age of IoT

Tom Dibble CEO, Aria Systems

@tom_dibble

@ariasystemsinc tdibble@ariasystems

3 CONFIDENTIAL Not For distribu4on All Contents © 2014 Aria Systems CONFIDENTIAL Not For distribu4on All Contents © 2014 Aria Systems

The Looming Opportunity: Internet of Things

Military Agriculture

Environmental

Consumer

Retail

Industrial

Medical

Automo4ve •  Product tracking •  Inventory control •  Focused marke4ng

• Wearable devices •  Implanted devices •  Telehealth services

•  Resource alloca4on •  Threat analysis •  Troop monitoring

•  Crop management •  Soil analysis

•  Species tracking • Weather predic4on •  Resource management

•  Parking •  Traffic flow •  An4-‐theT loca4on

•  SmartMeters • Wear-‐out sensing •  Manufacturing control •  Climate control

•  Smart home control (ligh4ng, security, comfort)

•  Op4mized energy use •  Maintenance


Bigger than Smartphones, Tablets, PCs (combined)

Source: Gartner (November 2013)

Shipments in 2020 (Millions)

Figure 2. Internet of Very Different Things

Hotel Door Locks

16000

14000

12000

1000

8000

6000

4000

2000

0

Parking Meters

Vending Machines

Remote Pa4ent-‐Monitoring Nodes

Toys

Smart Meters

Security Cameras

Indoor LED Ligh4ng

Smoke Alarms


IoT creates an explosion of data, devices and opportunity

– Peter Middleton, Gartner, Dec 2013

“…many categories of connected things in 2020 don’t yet exist. As product designers dream up ways to exploit the inherent connec4vity that will be offered in intelligent products, we expect the variety of devices offered to explode.”


How big will it be?

• The Google effect: “...Google is installing extremely fast gigabit internet infrastructure when the average person needs 200x less speed because of IoT...” •  – Daily Infographic, March 2014

>50 Billion Devices By 2020

How big is your guess?

$7.1 Trillion

– IDC

“… those billions of smart, connected gadgets such as Google’s smart glasses… should generate a staggering $7.1 trillion in annual sales by 2020.“

– IDC , June 2014

“Cisco’s Internet of Things Group (IoTG) predicts there will be over 50 billion connected devices by 2020.”

– Cisco , November 2013

The Google effect: “...Google is installing extremely fast gigabit internet infrastructure when the average person needs 200x less speed because of IoT...” – Daily Infographic, March 2014


Delays are costly Profi

t

Time

AUP Erosion

Shorter Peak Profitability Window

Scheduled Launch

Launch Delay

AUP Erosion Example: iTunes $.99 Walmart $.55 RCN $.?? Verizon $.??

Product EOL

Product lifecycle End-‐of-‐Life (EOL) date doesn’t change

Creates early and unrecoverable sales losses

Erodes Average Unit Price (AUP) over the en4re product lifecycle

Shortens the window for peak profitability

DELAY


The Mone4za4on of Things (MoT) is not about:

Device


Selling is Different

Managing Customers is Different

ReporPng is Different

InnovaPon Increases

It’s a whole new ball game


•  Freemium •  30 Day Trials •  n Day Trials •  By Segment

Mul4ple Geos/

Markets

Mul4ple Sales Models

Excep4ons: Discounts & Credits

Pricing, Packaging, Bundles

Contract Changes

Enabling unlimited, complex mone4za4on models

Consump4on

Subscrip4on

Occasional / On-‐Demand

•  Flat Rate •  Standard Tiered •  Volume Tiered •  Flat Rate Tiered •  High water mark •  Accumulated pooling •  Threshold •  Rollover •  Family plans •  Overage •  Pay-‐as-‐you-‐go •  Time based •  Mediated/rated •  Combina4ons

•  E-‐commerce •  Indirect •  Direct

•  Upgrades •  Downgrades •  Cancela4ons •  Pro-‐ra4on •  Trials •  Dunning


Requirement for compe44ve advantage

All Contents © 2014 Aria Systems

“Today’s hyper-‐compe44ve business climate requires flexible, configurable billing soluPons that can handle a wide-‐variety of consumpPon and subscripPon-‐based business models – and the ability to change them, quickly and without IT intervenPon.”

– Andrew M. Dailey, MGI Research (source: Forbes 3/18/14)


A compe44ve tool to beter serve your customers

RelaPonship Commerce

AcPve OrchestraPon

Enterprise Cloud

AdapPve Selling

Single Customer View


Make More Money • Op4mizing the life4me value of customer rela4onships

• Keep the business growing and valued

Solve Big Problems • Handles scale and complexity, security, reliability, compliance

• High performance opera4on

Keep Customers Engaged • Delivering a consistent high-‐quality customer experience

• Customer informa4on always presented in context

Manage Things More Easily • It’s in the Cloud! • Pushes informa4on • No rip and replace

Mone4zing IoT the Right Way Will...


Q&A

Monetization Strategies For The Internet Of Things

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