Keith recently took time to discuss emerging trends in the IoT/M2M industry, buyer profiles across vertical markets and challenges ahead.
What’s the mission of the IMC and how did the group come about?
Simply put, our mission is to increase deployments of IoT/M2M solutions by proving the technology business case to those that would adopt it.
The fundamental purpose behind founding the IMC was to facilitate opportunities for IoT companies to talk with potential customers. We really don’t know enough about who the buyers are, where they come from, what they need, and how can we help them.
We organized the CTIA M2M SIG more than 10 years ago so we’re known as a neutral player in the industry. We were initially approached by Intel and Deutsche Telekom to form this group. We quickly gathered an eclectic collection of solutions providers – hardware people, software connectivity -- and the consensus among the group was unanimous: “We don’t get enough opportunity to get in front of customers.”
How are you different from other IoT associations?
We know of no other IoT trade group that is gathering IoT buyers (enterprise users, OEMs) on anything like the same scale as the IMC. Virtually all other IoT groups we see are seller-centric – groups of solutions providers setting standards, establishing test beds, etc. Our mission is to bring buyers and sellers together – by getting buyers together, we’ve done the tough part. We’ve done it by talking to vertical markets in their own language – the content we generate doesn’t talk much about “IoT” – we talk about “infotainment” in automotive, “mHealth” in healthcare, “smart grid” in energy, and so on…
What’s your membership breakdown?
We currently have 25,000 self-identified IoT buyers in our community, covering eight different vertical markets (energy, logistics, healthcare, building and construction, retail, smart cities, transportation and manufacturing, etc.), with roughly 33% in North America, 25% in Europe, and the rest dispersed around the globe. It’s an excellent cross-section – operations, IT, R&D, and more. We also currently have 20 Board/Sustaining Member Companies – Telcos, hardware, software, Si’s – including Intel, HPE, PTC, Vodafone, and more.
Then, we further break those down into 24 more granular markets. Energy to us includes not just utilities, but also energy aggregators, pipeline management, and refineries management. The healthcare industry includes not only medical device manufacturers, but actual care providers. We can slice and dice our member data to tell how many IT people we have within the healthcare provider sector, for example. We get approximately 300 potential new members a week, all self-identified IoT buyers.
We have B2B2B and B2B2C, but it’s really all B2B. We’ve thrown the broadest possible net in terms of looking at the industry. We look at wearables as part of our consumer device market. Certain parts of the health care market are consumer, certainly the automotive part of the transportation market I would consider to be consumer. And we have an agribusiness vertical, which obviously is not consumer.
The content we provide is organized into these vertical markets. I instruct my editors to not talk a lot about IoT because the people who are actually deploying IoT solutions don’t think of it that way. I tell them, in the automotive space, talk about infotainment. Or in the energy space, talk about smart grids and pipeline monitoring and control. Or in healthcare, talk about wearables and telehealth. We try to address each market in its own language.
What does IMC’s organizational structure look like?
We have two membership levels. If you qualify as an IoT buyer, you can join our organization at no cost as an IMC Adopter. You can access any of our content streams and participate in our committees. Our other membership level is the IMC Sustainers, the only IoT solutions providers granted access to the IMC community of 20,000 enterprise users, OEMs and apps developers.
What’s the predominant job category -- IT or operations?
Close to 40 percent of our members self-identify as “operations.” We also have significant numbers coming from IT, R&D, and sales and marketing. What’s fascinating is that those demographic profiles hold across almost all of the 24 markets. For example, we thought for sure in the healthcare market, because of electronic medical records and HIPPA requirements, you would see a lot more IT people, but that isn’t the case.
Basically, they’re business people who have problems to solve. And again, don’t talk about IoT, but put things into their perspective. What problems do they have? Is it asset tracking? The results of a medical device which need to be integrated into a backbone software system?
At this point with 25,000 data sets, the information that we have is extremely statistically significant. It has been a fascinating exercise!
What similarities do you see among adopter/buyer groups from the different verticals?
That’s a deeper slice of the onion, and we do surveys around that topic.
Typically when we break those surveys down, we talk about the three most prominent groups within our membership: Enterprise users versus OEMs versus apps developers, which are probably 40/30/30. Interestingly, what we find is that they all have different takes on what’s happening, and it holds true across verticals. We see OEMs and apps developers pushing much more quickly than enterprise users.
We also do a quarterly buyers index where we ask about six, 12, and 18 month buying plans that we break down according to these three groups. Again, OEMs and the apps developers are consistently saying, “We’re going to be purchasing next week.” Enterprise users say, “Maybe next year we’ll make an investment, but now we’re looking at the market and we’re going to take our time.”
Another typical result we get when we peel back more layers of the onion is that, while a plurality of our members are ops people, we get a strong response when we ask, “Within your own organization, where do you turn to first for answers about IoT?” Typically, they go to the IT department first.
Plus, vertical versus horizontal -- a horizontal layer of technology that fits into a lot of different vertical markets --is the big challenge of IoT across verticals. Again, it goes directly to the issue of talking to your customers in a language that they understand. Those vertical markets are populated by people who are not technical, at least not in the way that we are used to dealing with. How do you reach out to those people? How do you break through to them? That’s the huge challenge that’s the genesis of this group.
What’s the #1 question?
When I talk to IoT companies on the supply side, solutions providers, and especially to start ups, my first question is always the same: What is your go to market strategy? You have a technology that could be sold to millions of companies, in hundreds of different vertical markets, so how do you intend to concentrate your resources to generate some success?
Companies are coming out of the woodwork with IoT software platforms, and unless you have an extremely strong differentiating factor, you need to look at developing vertical market solutions, or some other significantly different approach. Eventually, that there is going to be consolidation and selling to enterprises on a broad scale is something that few companies have the resources to do successfully.
Do you anticipate consolidation?
In certain areas I do. Especially in software; hardware in some ways is already consolidated. Look at all the different low-power wide-area options, and I include narrow band there. There are going to be a lot more losers than winners, right? Some estimate there are 700+ IoT platform companies and unless you have a niche approach with vertical platforms, it’s going to be hard to compete.
Will IMC become a standards organization?
The answer to that is an emphatic no! One of the first things we decided upon was that we would not be a standards body, but rather we would look to reach out to buyers. That was the important missing piece of the puzzle.
Anything new on the horizon?
The larger companies have told us they need help in sourcing IoT products and services. As classic example is the explosion of companies that say they have an IoT software platform. If you are responsible for procurement or are an ops person, where do you start?
With that in mind, we’re announcing a leadership committee of approximately 30 senior people from Fortune 500 companies that purchase IoT connectivity, hardware, software, and integration services. Their suggestion was to create tools that could help them. We are going to be rolling out a library of model RFPs that talk about what should be in an IoT software platform, not a technical standard, but a checklist. We will validate the compliant vendors as “model vendors” and the RFPs themselves will be done in a very open source fashion.
We’ll continue bringing our sustaining members together with our adaptor members in creative and useful ways. We’re going to expand to RFPs for software platforms, connectivity services, cellular, narrowband, satellites, and near range. We think that will be a really strong program for both sides of the equation to become involved.
We also intend to reach into public policy advocacy and we have retained some high level consultants in the U.S., Asia and Europe to talk to our group about public policy. And by that I mean not just regulations, but also incentives programs for government – what’s out there and what we need to be looking at. We intend to put out a comprehensive publishing program of what’s going on in the regulatory front and public policy. Look for more details to come.
We encourage any IoT solutions provider interested in learning more and having more contact with IoT adopters to join us and help us set a direction for the group. The more people that get involved, the more good work we can do!