M2M - Looking Beyond the Hype...
M2M market is expected to grow big time in the coming years. As per a report from Ericsson, 50 billion devices are to be inter-connected by 2020.
Naturally, there is a lot of hype surrounding the deployment of M2M solutions and services in enterprise as well as consumer markets. While technologists are gung ho about the possibilities of M2M and Internet of Things technologies, enterprise customers are looking at M2M solutions and services for addressing their key business challenges. For enterprises to invest in M2M solutions and services, technology / solution providers and service providers have to pay attention to these aspects:
1. Addressing the right problem with the right solution
Not all problems require an M2M solution. Identifying the right business problem to address is the key. Moreover, if the solution does not address the problem effectively, it will not gain wide spread adoption by enterprises. For e.g., just gathering data from sensors and devices and presenting them to the user serves little purpose if the user does not know how to use the data/information. The information has to help the user identify opportunities for cost and resource savings, improve productivity, efficiency, and optionally how to take remedial actions.
In addition, automating the end-to-end business processes using M2M technologies and solutions is also not always feasible. Automation brings its own complexities and issues. One issue is that of integration challenges with existing enterprise systems. Another is related to the data. If the device data is not reliable, or the processing of the data is not effective, automating the process (e.g., initiating control or taking corrective actions) can create more problems than it solves.
2. Maturity of the technology and solution
A number of new M2M technologies, products and solutions are being introduced every day in the market. Not all technologies are mature enough, and not all vendors and suppliers provide mature, scalable and robust offerings.
Compliance to industry standards based protocols, APIs, wired/wireless interfaces, etc. is another aspect that needs to be carefully considered.
In addition, making sure that the devices comply to the country / region specific safety and regulatory certifications is important. Not all vendors have certifications for all geographies. Working with the vendor to get the necessary certifications before deploying the solution is essential. Identifying the right technology and procuring M2M devices, products and solutions from the right vendors is most crucial for delivering a mature offering.
3. Operational effectiveness in enterprise and industrial environments
Many M2M solutions make use of wireless interfaces for communication between devices, and also between devices and backend infrastructure. It is essential to ensure that the chosen wireless communication technologies and products works reliably and effectively in the appropriate deployment environment - which may have a variety of impediments such as physical obstructions (metal enclosures & doors, glass walls & doors , wooden compartments, concrete roofs, brick walls, etc.), electromagnetic interference (from other wireless signals), noise and vibrations (from machinery, equipment), etc.) Common issues faced with quality of wireless communication include signal attenuation/loss, fading, packet drops, jitter, etc. These aspects have to be carefully considered while developing and deploying the solution.
4. Security and Privacy
Enterprise customers have concerns regarding the security and privacy of enterprise data gathered and processed by M2M solutions. Solutions need to address security of data at several levels - 1) the wired/wireless communication channels, 2) data storage, 3) at presentation level, 4) at interfaces with other systems, apart from others. Enterprises want to ensure that robust security mechanisms have been built into the M2M solution before deploying the same. M2M devices and solutions have to be certified not only for compliance to industry accepted security standards, but also have to clear enterprise-specific security policies, guidelines, and tests without which enterprises will not deploy them. In addition, many enterprises still prefer to have data collected and processed on-premise rather than sending data to a public cloud. These considerations have to be taken into account while designing and deploying M2M solutions.
5. Retrofits and interoperability with other enterprise systems
In most environments, M2M solutions cannot work in isolation. More often than not, they need to be retrofitted on to existing equipment, machinery, and integrated with other enterprise systems. This is a very critical need for many enterprises. Often, the M2M solution needs to have the ability to integrate with a wide variety of devices, equipment and enterprise systems using standards-based and proprietary interfaces.
6. Who will run the service
Not all enterprises have the ware withal or inclination to operate an M2M solution/service on their own. They would prefer some third-party service provider to provide the service to them with suitable SLAs defined and enforced. Some prefer to deploy the solution within their premise and either operate it on their own, or by a third-party. Others prefer to minimize their investments/risks and make use of third-party cloud based services and pay for the service as they go.
7. Tangible Business benefits
Technology for the sake of technology will not go very far. Enterprise look for tangible and quantifiable business benefits from M2M solutions. Key questions that need to be answered are: will the M2M solution/service help generate new revenue stream, can it improve revenue from existing streams, will it cut down on operational costs (if so, how significant will it be), will it make the enterprise 'green', will it improve productivity, efficiency, improve health and safety of employees and customers, etc. Many M2M deployments do not go beyond pilot phase and do not see commercial deployments due to one or more of these reasons: 1) the solution is not effective in addressing the problem, 2) business benefits are weak/unattractive, 2) solution is economically unviable.
8. Minimal Investment
M2M devices aren't always cheap. In fact, the more specialized a device is, the more expensive it is. Cost of devices is one of the most significant factors of an M2M solution. Enterprises would like to keep their upfront investment minimal. They would prefer if the service provider can deploy the devices on their premises for no-cost, on rental basis, or on lease basis rather than they having to purchase them.
In addition, enterprises would like to take advantage of any rebates and incentives - especially while buying the M2M devices, products and solutions. It is important to understand the rebates and incentives available in different geographies, who is offering them, which products and solutions qualify, how do the rebates and incentives affect the investment, etc. and educate the customers accordingly.
9. Pricing and Pricing Models
Right pricing is key. The solution has to be economically viable to see light at the end of the day. Flexible and innovative pricing models are also important. Pricing model related questions that need to be answered are: Can the enterprise "pay-as-you-go" for the service? Does the enterprise have to pay one time / annual licensing fee for the solution? Is the service offered on a monthly subscription basis? Is the pricing based on benefits derived - say cost savings achieved, etc.?
10. Reasonable Return on Investment
Return on investment is the most crucial aspect of M2M solutions. This is one of the first questions that gets asked by a customer. Do not go to the customer without answering these questions: How good is the return on investment? What is the payback period? Etc. Payback period of more than 2-3 years are hard to justify for enterprises.