Intel Internet of Things infographic predicts $6.2 trillion revenues by 2025

Here’s another beautiful infographic on IoT from Intel.

Clearly we need to have connected devices to enable this potential revenue streams. I’d like to see more focus on the value of the problems we’re solving, rather than (endless) predicitions on the number of devices that will be connected. In fact, I think many of could relate better to that than an abstract number and future date.
I am keen to do an infographic from the “value” rather than “connected devices” view for IoT, so please get in touch if you have some good links.

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Where’s the value in the Trilion Node Economy

Introducing the Trillion Node Economy (TNE). The Trillion Node Network is being built every day. Whether it’s Oslo’s new streetlight infrastructure  or the Songdo Smart City in South Korea. This blog has so far focused mainly on the technical, political and social issues of the Trillion Node Network.

Technology’s role is to add value and so does the Trillion Node Network. There’s lots of “noise” around Smart Cities and the amazing applications they can support and enable. Cisco believes that Smart Cities is a $1.2 trillion opportunity , “maybe bigger than the internet” according to their CEO John Chambers.  For me, too many of these are examples of what technology can do, not solving real-world valuable problems.

I’m going to continue to comment on the progress and issues of the growth and development of the Trillion Node Network, but will focus more on the economics of the Trillion Node Network, or “Trillion Node Economy”.

As people start to feel more comfortable with the idea of a Trillion Node Network, I want to answer some key questions about the Trillion Node Economy:

1)   Where’s the value?

2)   What does the eco-system look like?

3)   Who can play (and who shouldn’t)?

4)   Where’s the creative destruction?

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Uncovering the value in the Trillion Node Economy

I believe there is a distracting and value destroying focus on technology for its own sake, with little emphasis on providing elegant and valuable solutions to customer challenges.

So, where’s the value in the Trillion Node Economy? Simply, it lives where complex, valuable problems can be solved using the Trillion Node Network.

Whilst that might sound too simplistic, it always surprises me that most thinking starts with what cool stuff we could do with new technology, without much thought into the demand and the value.  Just think back to the £22bn spent on UK 3G licences with no supporting business plans or understanding of potential customer needs (I know, I was there!)

There are a lot of people spending lots more money looking in the wrong places. Providing solutions to problems that don’t exist or where there’s little or no realisable value.

There’s a long list. Just look at any Smart City project searching for compelling services that justify the network investment and generate new revenues. Lots of hype, but when you look closely at the business cases, they don’t add up.

Meanwhile, look at Apple. They have focused (and executed brilliantly) on solving valuable problems that people will pay serious money for. Interface that works, devices that are beautifully designed and simply work.

Designing new technology is relatively easy. Money, smart people and hard work will deliver new devices, applications and services. Finding valuable, problems that people are willing to pay for is less obvious and fraught with failure. And if there’s one thing Executives and Shareholders don’t like it failure. Hence, I believe the focus on the more concrete new technology with visible, tangible outcomes.

When Orange was successful, we used to focus on a day in the life of our target customer base, see what challenges they faced in their daily lives and try to find ways we could help them find solution using our network, our services and their handsets.  Of course we needed to find solutions that people would find worth paying for, but the starting point was the customers’ challenges.

Some companies do start here, but quickly lose sight of solving customer challenges in favour of gleaming, cool new technology. Then they’re off on the wrong track, along with the rest of their competitors.

The late Steve Jobs summed up this approach neatly saying “Start with the customer experience and work back to the technology, not the other way around.

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Smart Cities are built “Bottom up, Incremental and Inclusive”

Recently I’ve been Tweeting on “Bottom up, Incremental, Inclusive” (BII) approach to building Smart Cities.

Whether its Smart City OS or a Walled Garden approach, history tells us that not only cities, but recent advances like the Internet, just aren’t built top down. Social innovation is bottom up.

I like ICF’s approach to Smart Cities. They need to be innovative, inclusive and boot-strapped. People are also more innovative about their daily lives than any government or corporation. Just look at the Jugaad Innovation happening in some of the most populated cities in the world.

We need technology and investment, but don’t be blinded to solving the problems of cities and making people’s lives easier. We need “Bottom up, Incremental & Inclusive” approach to Smart Cities.

Posted in Digital Infrastructure, Infrastructure, Innovation, Internet, Jugaad, Networks, Smart Cities, Smart City OS, Trillion Node | Tagged , , , , | Leave a comment

Move the work to the people, not the people to the work – PART 2

In March 2011, I wrote about the UK Government plans for HS2 High Speed rail link. My message was clear and simple, don’t move the people to the work (moving atoms), move the work to the people (moving bits).

The Department of Transport had said “HS2 is a project that will deliver jobs and prosperity across the entire country by connecting the south with our great northern cities.” This week UK Govt seem to be back-tracking on the HS2 plans.

Here’s a great opportunity to rewrite that DoT aspiration to “The 100Mb Fibre to every home is a project that will deliver jobs and prosperity across the entire country by connecting the south with our great northern.”

We’re in a global economy and we need to ensure that we have the best and widest wired & wireless infrastructure in the world. Its understand we need great airports (visible assets) to be a global player, why is it so hard to make the case for massive investment in communications infrastructure (invisible assets).

A plea to UK Govt, if you’re not going to build HS2, please give a big shot in the arm to our well-below-world-class communications infrastructure. Now!

Posted in Digital Infrastructure, Infrastructure, Internet, Mobile, Networks, Smart Cities, Transport, Trillion Node, Trillion Node Economy | Leave a comment

Telco’s on track to miss Trillion Node Network revenues

On 15th February 2001, the BBC website article on “Search for 3G Revenues  said “gaming and betting would be the largest revenue category” (Source: Datamonitor) and the revenue model for operators would be “to take a cut out of the profit of transactions carried on their phones”.

Well, 11 years later in 2012 things look very different. It’s Apple who are taking a cut of the transactions and social networking is the most popular application on the mobile internet.  Telco’s need to use this recent history lesson to ensure they arrive in 2020 looking back on another missed opportunity.

Telcos need to understand the Trillion Node Network value chain and where they can be sustainably profitable and have competitive advantage. Whilst each telco will have a different strategy, depending on their market position and depth of pockets, they all need to ensure they adhere to 3 golden rules that they ignored last time around:

1) Stop thinking like network operating companies. This is the path to becoming a utility with a low margin business

2) Experiment on a strategic scale – Think like Google and seed lots of ideas and give them backing, ensuring there’s a healthy mix of new people with “Internet culture” in their blood

3) Deliver outcomes, not services – To be valuable and embed yourself in customers businesses you need to deliver end-to-end transformations. New, innovative services are just not enough.

I don’t see any telco embracing all 3 golden rules yet, but they need to and quickly to ensure the next 10 years isn’t about declining margins and missed opportunities.

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Uncovering the value in the Trillion Node Economy

Ok, this could be a whole book on its own, so let’s start at the high level in this post. The e-book will come later ;-)

In summary, I believe there is a distracting and value destroying focus on technology for its own sake, with little emphasis on providing elegant and valuable solutions to customer challenges.

So, where’s the value in the Trillion Node Economy? Simply, it lives where complex, valuable problems can be solved using the Trillion Node Network.

Whilst that might sound too simplistic, it always surprises me that most thinking starts with what cool stuff we could do with new technology, without much thought into the demand and the value.  Just think back to the £22bn spent on UK 3G licences with no supporting business plans or understanding of potential customer needs (I know, I was there!)

There are a lot of people spending lots more money looking in the wrong places. Providing solutions to problems that don’t exist or where there’s little or no realisable value.

There’s a long list. Just look at any Smart City project searching for compelling services that justify the network investment and generate new revenues. Lots of hype, but when you look closely at the business cases, they don’t add up.

Meanwhile, look at Apple. They have focused (and executed brilliantly) on solving valuable problems that people will pay serious money for. Interface that works, devices that are beautifully designed and simply work.

Designing new technology is relatively easy. Money, smart people and hard work will deliver new devices, applications and services. Finding valuable, problems that people are willing to pay for is less obvious and fraught with failure. And if there’s one thing Executives and Shareholders don’t like it failure. Hence, I believe the focus on the more concrete new technology with visible, tangible outcomes.

When Orange was successful, we used to focus on a day in the life of our target customer base, see what challenges they faced in their daily lives and try to find ways we could help them find solution using our network, our services and their handsets.  Of course we needed to find solutions that people would find worth paying for, but the starting point was the customers’ challenges.

Some companies do start here, but quickly lose sight of solving customer challenges in favour of gleaming, cool new technology. Then they’re off on the wrong track, along with the rest of their competitors.

The late Steve Jobs summed up this approach neatly saying “Start with the customer experience and work back to the technology, not the other way around.

In Part 2 of this post, I’ll look at uncovering problems that are valuable to solve.

Posted in 3G, Apple, Customer Experience, Digital Infrastructure, Infrastructure, Internet, Mobile, Networks, Smart Cities, Steve Jobs, Trillion Node, Trillion Node Economy, value chain, Value Creation | Leave a comment

Intel’s Internet of Things infographic predicts $6.2 trillion revenue by 2025

Here’s another beautiful infographic on IoT from Intel.

Clearly we need to have connected devices to enable this potential revenue streams. I’d like to see more focus on the value of the problems we’re solving, rather than (endless) predicitions on the number of devices that will be connected. In fact, I think many of could relate better to that than an abstract number and future date.
I am keen to do an infographic from the “value” rather than “connected devices” view for IoT, so please get in touch if you have some good links.

Posted in Business case, Digital Infrastructure, Networks, Trillion Node, value chain, Value Creation | Leave a comment

A new view of data privacy is essential for smart city success

In the Trillion Node Network the network infrastructure is the enabler. On its own this infrastructure isn’t enough to “breath life” into a smart city. Vast amounts of available data add the “smartness” to the “dumb” infrastructure. It’s the combination of the pervasive infrastructure, together with relevant, meaningful data and useful applications that creates the value in a smart city. This value is created in the Trillion Node Economy, a concept I’ll discuss in an upcoming post.

The Smart City datastream will be most useful and valuable when it is topical, personal and timely. To provide this type of data requires a level of intimacy, that for some, maybe perceived as an invasion of privacy. Recently The Telegraph newspaper had an article on Facebook users unknowingly sharing personal data, highlighting the level of concern for many over the availability and sharing of personal data

Amid concerns about data privacy by Government and the press, a generation is growing up sharing more personal data online than ever before. Even the the UK’s Information Commissioner’s website has specific advice aimed at the Youth segment, although I expect it’s not a site you’re average teenager visiting frequently.

To reap many of the benefits of a truly Smart City, we’ll need to change our view of privacy in the future. We should also better educate ourselves about how much of our private data is already available to all who care to look online.

Posted in Internet, Privacy, Security, Smart Cities, Transport, Trillion Node | Leave a comment

Security is the key challenge to the Trillion Node Network

In the connected world everything, not just everyone, will be connected. This offers great opportunities for new services.  With hyper-connectedness it will be possible to connect with almost anything from anywhere. This hyper-connectivity is what will enable and drive value in the Trillion Node Economy.   This connectedness also creates a security challenge. New smart cities like King Abdullah Economic City (KAEC) are carefully thinking through the consequences of this connectedness, as if you can control all the city cooling remotely from the city management control desk, you could also control it from an IP address anywhere in the world.

To address this security issues, I believe we need to resist the traditional command & control “lock-down” approach, as the Trillion Node Network is just to big and complex to manage this way.  I think we should use 3 principles to guide the development of the Trillion Node Network

1) Design – Architecture needs to be modular and hierarchically decomposable (Architecture of Complexity)

2)  Robustness – recognise that security will be breached and plan for it

3) Resilience – the majority of the Trillion Node Network needs to be fully able to function, even after a security breach

Posted in Digital Infrastructure, Infrastructure, Mobile, Networks, Security, Smart Cities, Trillion Node, value chain | Leave a comment