As I hinted to in my previous post, the “Internet of Things” is the evolution of many existing technologies that have been around for decades. The keyword being “evolution”. It has evolved from traditional Machine-to-Machine (M2M) computing and business models to Machine-to-Machine-to-Cloud-to-Insights-to-Command/Control-back to-Machine… and these models continue to evolve.


You don’t have to take my word for it. If you are a law abiding citizen, then I’ve got two laws for you.




Moore’s Law proposes that the number of transistor per circuit will double every 18 months.  Metcalf’s Law proposes that the value of telecommunication networks is proportional to the square of the number of connected devices.  Both of these laws have proven to hold true.  As a result, computing power has increased, while the size of devices have decreased (ie. Wearables and Microprocessors).  Furthermore, network connectivity and connected devices has exponentially increased.  As one might expect, surging up behind this wave of innovation are standards, frameworks, and protocols for connectivity and communication, such as IEEE P2413AllSeen/AllJoynOICAMPQThread Group, etc.)


Business Models define Use-case

So while the IOT (Internet of Things) is relatively new in some industries, it should not be portrayed as vaporware or unproven.  It’s simply the product of IOT (Innovation over Time) that has been evolving in pockets across manufacturing, retail, and healthcare among others.  Those who haven’t been engaged in M2M, telco, or embedded space in the past, IOT will be new and I expect there to be some skepticism.  In any case, I’d encourage you to not seek out a specific use-case or problem to solve with IOT.  Rather my consultative approach for veterans in the M2M world and those new to the concept, is to start by carefully examining and even challenging you existing business models.  Use-case definition must be preceded by a business modeling exercise. You may even start with an “empty” business model canvas.  The purpose is to uncover gaps and opportunities for new revenue streams, new sales channels, new partnerships/alliances, new markets, and even new service offerings.


To most effectively kick start this discovery exercise, the leadership team must first disconnect from “what is” happening within their business and entertain the “what if”.  While disconnecting from “what is” can be challenging and even seem impractical, it’s fun and enlightening when you finally do.  It also most often yields the most creative and impactful use-cases.




Let’s consider a business providing Building Management services or an HVAC supplier as an example. One might see immediate value from automating the control of heating and cooling based upon environmental data collected sensors in real-time. However after assessing their business model and walking through some “what if” scenarios, such as:

  • What if we could predict in advance how long it would take to heat/cool the building to its target temperature? Then we could allow the HVAC system decide for itself the optimal time to start and not waste energy costs.

  • What if we know how much solar radiation affected the temperature of certain rooms verses others within the same zone that may not be affected by external light/warmth? Then we could put those rooms in a separate zone and provide greater comfort to the occupants.

  • What if we know how people flowed and where they congregated throughout the building? Then we could optimize emergency routes/location and assist first responders in the event of an actual emergency.


Here’s a look at this scenario with all the IOT component, some of which you may already have in place.




These are just a few options, but there is much more.  After reviewing these scenarios in alignment you’re your business model, you might even discovery new revenue streams or compete strategies.  You might ask… “What if we could bundle these options as a new service offering, brand, and sell them separately or even to our competitors?”  In this case you may find opportunities to lead the industry, differentiate yourself, and recover lost revenue from your competitors.


Perpetual Revenue and Perpetual Value

I’ve rarely found an industry or business model that couldn’t benefit from at least one or all parts of what IOT has to offer.  The visibility and insights collected from your “things” is valuable by itself, but even more so when accompanied by predictive analytics.  The difference between “reactive” and “preventative” maintenance and updates can often be measured in Millions.  Also the ability to provide over-the-air updates (SOTA/FOTA) to your products/”things” offers you an opportunity for perpetual revenue and your customers, perpetual value.  The difference between transactional value and perpetual value is often measured in customer loyalty and longevity.