Competitive pressures in the IoT software market

I heard a story from an IoT software platform vendor recently about this year’s IFA consumer electronics show in Berlin.
At the show, an IBM guy walks up to him and says, hey Bob, did you know there are 163 IoT platforms now. Wow, that’s a lot.
Later in the day, an IHS analyst says to him, hey Bob, there are over 200 IoT platforms. Man, the number grew by dinner.
Bob gets home and thinks, wow, it’s getting really competitive out there. 200 platforms. Later that week, he’s chatting with an investment banker and the topic arises. What does the banker say? Hey Bob, you know there are 300 IoT platform providers now.
Clearly the number of IoT software platforms appears to be growing by the hour. Just ask Bob.
So while the number probably isn’t growing by the day, it is growing. But why is this happening? Well, the simple answer is that a lot of entrepreneurs and investors believe there’s a lot of money to be made by networking the physical world. Everyone from IBM to two developers with a website are looking for business.
They believe that all of these connected devices, 50 billion if you ask Cisco, will need software and that the device makers are unequipped to write that software, manage back end cloud services, design hardware modules, build APIs, or handle mobile integration. After all, whether you’re Whirlpool or Staples, building out robust software platforms for connectivity isn’t your corporate DNA.
And the folks starting all these IoT platforms are largely right. The market opportunity is real and the pace of connectivity may encounter bumps as a lot of connectivity with little consumer ROI is introduced, but the long term trend is there. The question now is with so many platform providers wanting access to the market, how can they differentiate themselves. Or asked another way: So, Bob, when’s the consolidation gonna start happening? (My best guess is in around 18-36 months when all the venture capital has been spent and VCs are only interested in providing latter stage funding to the platforms showing the most traction.)
To answer the question about differentiation, the major factors for platform customers are price, time to market and security. Pricing wise, there’s obvious downward pressure and I’ve even heard that some platform providers might be trying to provide connectivity software free and attempting to monetize in other ways like through third party deals in industries like the utility sector.
Though I also think what’s happening is that the market is segmenting as certain premium brands gravitate towards the most robust and skilled platforms, which can still demand reasonable prices, while a lower market segment emerges that will provide basic connectivity for less expensive products that may not care about data, analytics, or to be honest, security.
Time to market also will remain critical as the whole reason OEMs go to platform providers is to get them to market as soon as possible. If they wanted it to take a long time, they could do it themselves. In market segments like smart locks, security will remain absolutely crucial and customers will pay for the best. That’ll be less true for products like wearables where the perceived security threat is lower. For platforms attempting to crack the security conscious markets, basic strategies like repeated third party audits will be standard operating procedure.
In reality, it remains very early days for the IoT platform market. We’re waiting to see how impactful a lot of outcomes from IoT will be. For example, how critical will connected product user data be for product designers in terms of iterating and making better products faster, or even through firmware updates? My belief is that in some scenarios, this will make a real difference. And if so, it will further drive connectivity due to accelerating the competitiveness that results from IoT.
The trick for the current class of platform providers is to make it through the next 2-4 years so when the consolidation begins and the dust settles, they’re there to provide platforms for that accelerating market.

Triangulating on Conversus: forecasting a Next Work model

an open Gigaom Research brief

taxa: Next Work, Triangulation, Conversus, Work Chat, Futures

I gave a talk the other day for the Enterprise Digital Summit 2015 in London. I was in Austin, so we did the talk via Skype, which is not a first for me, but it was the first time I ever gave a talk at 3:30am.
It was the night after Back to the Future Day — Marty and Doc traveled to Wednesday Oct 21 2015 in part 2 of the series — so it was good day to talk about the future of the organization, or the future of anything, I guess.
Here’s an annotated version of the slides, with something like the rap I gave when walking through the presentation.

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I’ve written a great deal over the past few years about the new era — the new economy — that we are now living and working in, which I refer to as the Postnormal. I use that term to avoid the clunky formulation of ‘post-postmodern’, but it’s a synonym for all intents and purposes.
The postnormal is when the truisms and premises of the postmodern world begin to unravel, and by 2005 — with the rise of the social web and the movement into a connected but increasingly volatile, uncertain, complex, and ambiguous world order — it had started to be clear that we had moved into a time where there was no normal, anymore.
But today we are focusing just on where business organization is headed, in these early days of the postnormal era.

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I’m trying to intuit the lineaments of possible futures, not ‘the future’ in scare quotes.
I think like a futurist, which is really just saying ‘I am a human being’. But more specifically, I like to create narratives about potential futures, to help others — and me — think more structurally about the future. But I’m not in the fortune-telling game.

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One of the things that we have to realize is that we have to escape our conceptual blinders to think about possible futures, and that is harder — as Keynes points out — than dreaming up new ideas.

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Triangulation is a trend analysis and forecasting technique, one that I am making central to the consulting, analysis, and research going on at Gigaom Research.
We employ the three-way juxtaposition of technology, trends, and people to help structure our thinking, and the way we analyze alternatives with clients and in our research.

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They all influence each other in messy ways. Messy is good. The world is messy, so the closer you get, the messier things are.

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Here’s an extended example leading toward our focus, the postnormal organization. The technology is cotech (all work technologies that are about sharing: co-editing, collaboration, co-curation, etc.).
The trend we’ve selected for this scenario is the movement toward more autonomy, which is a characteristic of agile, distributed, and/or high performance work.
This trend has led to new requirements/motifs/use cases for cotech.
One of the key differences is that more autonomy for individuals and teams is a decrease in the focus on managerial oversight versus peered ‘undersight’. In such use cases we see a need for ways to increase sousveillance (bottom-up awareness of what others are doing), and a decrease in managerial surveillance. Or as I characterize it, little brother, not big brother.

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On the People vertex of our Triangulation, this primarily plays at the social scale I call sets: small known networks that communicate frequently and reciprocally, like small work groups, or families. I have written about social scale in depth in other posts (see Understanding the failed promise of ‘social collaboration’ and Sets, scenes, and worlds: understanding social scale in the organization).

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In aggregate, we arrive at what I call a scenario: a triangulation on the cross influences of the selected technology, trend, and people as a way to examine what’s happening right now or in the near-term future. This forms a baseline to then create forecasts about the more distant future.
Note: cotech tools implicitly limit what they ‘think’ is important by what they allow users to capture and share. But they can be successful even by avoiding making conventions explicit, like work chat’s weak support for greater autonomy.

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We can hypothesize a change in the scenario over some time frame, leading to a forecast. In this case, a forecast I call Conversus.
The thought here is this: imagine that the liberalizing influence of greater autonomy at the team level (‘sets’) may have an impact over time at the company level (‘spheres’), which may lead to increasingly democratic management disciplines. This could be characterized as one of the features of ‘postnormal’ management disciplines.
This change in management thinking and behavior — and the likely distribution of decision-making to larger networks — reflects back on other aspects of the triangulation. In particular, cotech vendors may start to more explicitly support that sort of decision-making at a greater than team scale, where the changes in is more implicit.
This is a forecast, since it is a projection from a current day or near-term scenario to something longer range, like 3-5 years out, as in this case. We also explicitly change one or more of the factors, in this case changing social scale of the cotech and autonomy to company-wide.
As I mentioned, this is the forecast I am calling Conversus, a coinage intended to indicate a balance of consensus and dissent in postnormal work philosophy.
That shift represents a movement away from ‘charismatic’ and ‘traditional authority’ to ‘legal/rational authority’, as characterized by the political philosopher Max Weber in The Three Types of Legitimate Rule (1922). I like how Dana Williams characterized it,

When I discuss Conversus, I mean an organizational culture grounded in the principles of ‘commons’ thinking, where the resources of the company — including labor — are treated as shared by the members of the company, but subject to rules intended to counter destructive overuse.

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Conversus is not Holacracy by a different name. It’s quite different. Instead of a system that rigorously leads to relative consensus on policy based on tightly choreographed decision-making, Conversus is built around autonomy and cooperation.
But this is only a forecast: we will have to wait to see the form that any triangulated forecast will take in reality, if it does occur at all.
Best to think of forecasts as primarily designed to make us think about the future in a structured way, not to predict it.
I don’t pretend to know the specifics of hypothetical implementations of technological platforms that might support Conversus-style organizations, but I don’t think I’ve seen anything like that yet.
(I will be expanding on Conversus and the postnormal organization in other writings over the next weeks and months, I am sure.)


So, two things going on here:

  1. A brief introduction to Triangulation: a scenario and forecasting technique for Lego-izing the future. Triangulation is like a Tinkertoy modeling set, for fooling around with constructing, analyzing, and deconstructing futures. As you can see it has a sort of algebra or set-theoretic notation that can be used to spark thinking and pose questions. (What does this — {Cotech U IoT, ^Mobility, World}, or, in English, the convergence of cotech and the Internet of Things plus increased mobility, operating at the scale of our entire society — make you think of? Don’t be scared! There are no wrong answers, but there are hundreds of plausible forecasts that could be spun.)
  2. At Gigaom Research, I will be leading a push to develop two dozen or so scenarios and forecasts to help organize how we segregate and aggregate our research and writing. So Conversus and Work Chat will be two themes — or taxa (from taxonomy) — we will be returning to time and again, along with other more commonplace ones — like Mobility and The Internet of Things (IoT). Other themes that we’ve used in the past will be retired, as they lose their emotive force or clarity, like Social. Instead of Social, I will be using the term Next Work, which is shorthand for The Next [Era of? Sort of? Management of? Organization of? Principles of? Technologies of?] Work.

It’s worth expanding on the last point, and to make something clear. Gigaom Research will differentiate our work — and our value — by continued focus on the implications of emerging technologies and their impacts on business, media, and society. We are focused on providing deep insight to our target constituencies, leaders in business and technology companies, and all the players that populate the marketplace in which they coexist.
Toward that end, we will be extending our orientation towards futures-based analysis and research, and doubling down on techniques like Triangulation to provide new lenses to peer into the new world where we live, work, and play.
For business leaders, technology companies, and futures-oriented analysts who gravitate toward this thinking — and who are tired of the speeds-and-feeds or look!-shiny sorts of analysis that generally comes from the technology-meets-business commentariat — I invite you to contact us to discuss how we might work together.

Live blog: Samsung Unpacked launch event in New York

Samsung is expected to launch the latest Galaxy Note handset at simultaneous events in New York, Beijing, and Berlin this morning. We’ll be liveblogging the New York location here starting at 6am PT.

What do future products look like? Personal, sensual, intimate

Huge technology trade shows like IFA are meant to parade the biggest products around. But what if the biggest isn’t the best? What if intimacy, personalization and customization are the things we crave? That’s what I argued at a fringe event in Berlin last week.

Sony Tablet P video: Finally a fresh tablet design!

With so many iPad lookalikes in the tablet market, it’s actually refreshing to see a new design. And the freshest of them all may be Sony’s new Tablet P with its dual screens in a folding clamshell case, which looks intriguing in this first look video.

Samsung Galaxy Tab 7.7: a 7-inch, 720p tablet?

Samsung is expected to announced a new tablet, the Galaxy Tab 7.7, at next month’s IFA event. The 7.7 could indicate the screen size, but perhaps not: Samsung is working on 7-inch 720p Super AMOLED Plus screens, so this might be a 7-inch, high-definition slate.