Tony DeRuvo, Senior Product Manager - New Product Initiatives – June 16, 2015
Having worked for a while in the industry, you seem to get use to invites pouring in for events and conferences held nationwide. But to receive one to the CTIA Innovation Council was of particular delight to me, as this year’s conference was by invitation only. The event was limited to only 100 participants. The people attending were C-Level Executives that work for the tech world’s most influential companies.
Besides being hosted in a cozy resort, the conference was held under the Chatham House rules, which guaranteed lively conversations, juicy tidbits and a lot of fun to attend. The theme of the conference was based on the up and coming ‘Internet of Things’ topic along with Mobile Identity with a focus on what strategies carriers can deploy around these new technologies.
Internet of Things (IoT) On Everyone’s Mind
Analysts and experts were present from the industry, each had their own view, but what stood out was that ‘The Internet of Things (IoT)’ is going to be part of the fourth wave within the telecom industry. Each new wave represented a new revenue stream for the carriers and a buffer against declining revenues from previous waves.
- 1st Wave – Voice
- 2nd Wave – Messaging
- 3rd Wave – Data access
- 4th Wave – IoT
What I found interesting is that the first three waves revolved around saturating the user base (i.e. putting more phones in more people’s hands). The next wave will exponentially increase the number of edge devices. It won’t be only phones, it will be all manner of sensors, detectors, appliances, etc. In fact a Gartner study (Nov 2014) shows that around 4.9 billion connected devices (non-mobile phones) will be in use in 2015 – this number easily supersedes the number of Internet connected mobiles (smartphones), which is around 1.8 Billion. Looking to the future, Gartner further predicts that the number will grow exponentially to 24 Billion connected devices in the next six years.
IoT represents a new opportunity for carriers that can leverage their four key strengths; ubiquitous connectivity, network intelligence (location services, billing, etc.), customer data (identity) and trust. Depending on who you listen to, analysts predict the growth cycle to 2 to 5x larger than the previous waves. Dream or Reality? Only time will tell I suppose.
Role of the Carriers and Identity
With the rise in IoT, there will be an emergence of use cases which will directly relate to subscriber-based authentication. We are still at the very beginning of connected devices. Today’s strategies are siloed. In fact most consumer connected products rely on home Wi-Fi or Bluetooth to work – completely bypassing the carrier’s network. Carriers are aware of this and are working on authentication and identity standards that can support IoT services. Keep in mind that many connected devices have a phone number (think sensors in a fleet of trucks). One carrier noted, “It would be a failure if the wireless industry can’t figure out how to use this.”
I do ask myself will the carriers overcome self-interest to cooperate on setting up a common platform for authenticating and providing user security. Feel free to comment on this point but if my memory serves me right – the last time mobile operators cooperated in this way was when they put in place SMS interoperability. To put this in context – Clinton was president.
Where’s the Money Flowing? What’s Next for Investment?
Investors in attendance were positive on all things IoT. They acknowledged that it is akin to the Wild West with companies trying different routes to IoT dominance (a colleague of mine described it as the Cambrian explosion – The Future of T2P Messaging, worth a read).
Specific areas of interest (in no particular order) are IoT for logistics, safe cities, block chain architecture, pseudonymous identity (by affinities), disposable identity (for each use case or transaction), and behavioral identity (e.g., an app which flags emotional or behavioral health issues like depression by smartphone usage patterns.
The Future is Bright
IoT represents a new opportunity for carriers that can leverage their four key strengths; ubiquitous connectivity, network intelligence (location services, billing, etc.), customer data (identity) and trust.
These four key strengths can play a vital role in the burgeoning IoT space;
- Connectivity – both to the end point device and backhaul
- Intelligence – Intelligent network based infrastructure will allow interoperability between devices, ability to provision, edit and bill
- Customer data – authentication and security
- Trust – carriers are traditionally trusted entities by the consumer
My big question to the community – will the carriers overcome their traditional barriers to cooperation and become a key player in the IoT value chain?