M2M and IoT connectivity – why resellers mustn’t commoditise

Extended article originally published in Comms Business Magazine, May 2015

Jon-Paul Clarke, Business Development Director, Wireless Logic explains: As the business and consumer worlds come to terms with the phenomenon which is the ‘Internet of Things’, the potential behind the hype is now fast becoming reality. For commerce, the benefits are tangible. Connected devices reporting on mission-critical information are creating new business streams, untold operational efficiencies and, dare I say it, copious amounts of data. But it is still early days, across all markets. Industry commentators are continually citing the challenges of integration from more traditional IT infrastructures to IoT enabled platforms, the big security issues that seem to make global headlines every time a connected car is hacked, and the practical implementation of utilising all of that valuable data into real business advantage. We know. 2015 seemed to be a year of realistic adoption with pioneering unified comms partners getting firmly behind the platforms and developing respectable go-to-market strategies, many in partnership with M2M/IoT Managed Services Providers like Wireless Logic.

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IoT Data SIMs – a commodity sell?
When one reads about the importance placed on IoT in the global market place, it then comes as a surprise hearing about the ‘commoditisation’ of M2M/IoT connectivity. Data SIMs for applications that are sold on price alone, creating instant gratification in terms of SIM subscription numbers, yet inevitably the realisation that at the end of the contract term, the business will simply be put up for auction again with ARPU reducing further. Of course there’s a market for this – a SIM-only deal where little or no value-add is enabled, available or delivered that would otherwise make the customer reliant upon the provider. But is this the type of business you want to be involved with?

True IoT innovation which involves connectivity as part of its wider eco-system is likely to demand more than just a data SIM. And it’s here that we remind potential customers that IoT is inextricably linked to a user’s corporate network, and as such is a vital component to their operation and processes with all of the same security considerations and resilience required. The question we should be asking users is ‘what if these links are lost and how will this impact your business?’ Now factor in the challenges of failover, integration and cost implications and you can start to appreciate the real value that you should be placing on your connected solutions. View IoT communication in this way and it’s clear to see how connectivity solutions should not be viewed on price alone. The detail of ensuring the right type of data connectivity – local, global or roaming, fixed IP, secure networking, tailored control platform to monitor data usage in real-time, and the ability to manage multiple networks through one window – all of these points must be considered to ensure suitability for the lifespan of the application. And don’t forget that cellular may not always be the answer – perhaps other bearer services could be more relevant such as SIGFOX, NarrowBand IoT (NB-IoT) or LoRa – low power radio solutions, more suited to devices with minimal power availability and/or signal constraints.

Stack ‘em high but don’t sell them cheap
Reflecting on the above, you can now pose the question… sell SIMs on price and expect a price war in the future, or approach the market in a more consultative way – developing long-term relationships with your customers and own/monetise their entire IoT space. It is the latter that is going to create on-going value and recurring revenues, creating a ‘go-to’ relationship where you are delivering fully-wrapped IoT communication solutions with layers of added-value bolted on. So that is my call for your consideration. Marketing M2M and IoT solutions where you become an integral part of a customer’s infrastructure is, to us, the way forward. Partnering with Managed Services Providers such as Wireless Logic will give you confidence to market higher end-to-end solutions that will, longer-term, create recurring income and importantly, total credibility with your own customers as you provide the all-important communications platforms. And I stress the word ‘partnering’ as you can’t be expected to impart every aspect of the knowledge bank now expected from an IoT comms provider. In an ever-evolving market, technologies, platforms, tariffs and bearer services are all changing, regularly. Choose your IoT partner carefully. Whether you use them as a ‘white label’ service or co-brand the pitch, you simply must ensure that you are fully armed with the right skills, knowledge base and key personnel to design, brief, implement and manage – for the entire duration of the project.

Outside the box opportunities
Finally, as you think about future approaches, I would urge you to open your mind to the growing opportunities. Yes, we know vehicle and asset tracking are bread and butter verticals, but that’s only the beginning. Think healthcare, security, Usage-based Insurance (UBI) and manufacturing. In fact, just stop and look around you and consider how many opportunities there are – B2B and consumer, it’s mind-blowing. Also consider the monetisation – so many applications are starting to utilise high-bandwidth 3G/4G solutions which generate multi-Gb usage. It all adds up. Also think about your core activities – we are seeing an unprecedented uplift in enterprise solutions – 3G/4G back-up to ADSL, and similar solutions for fast set-up remote locations. Each and every application gives you scope to earn, and own more of your client’s communication space. And get to know more about what your customers do outside your main topics of normal conversation. By understanding more about their business processes and activities, you may identify areas for existing and future connectivity which are not managed by your day-to-day contacts. Don’t expect joined-up thinking where IoT communications is concerned within a customer! At Wireless Logic we are developing support services to enable voice resellers, unified comms providers and related service specialists to market best-in-class M2M/IoT connectivity solutions with confidence. I repeat again… stop thinking quick, dirty and low-value SIMs and start on your journey of new, value-added and entirely sticky IoT communications offerings. You will be delivering solutions that will be essential to the well-being and operational efficiencies of your customers. DON’T UNDERSELL YOURSELVES.

Jon-Paul Clarke, Business Development Director, heads up Wireless Logic’s M2M & IoT Connections Partner Programme.