That almost all new technologies eventually come to subvert the established order is clearly evident for anyone looking at the last few decades of history. Soon most humans on the planet will own the equivalent of a 1980s supercomputer – a smartphone – and businesses will increasingly benefit from advanced applications and services through cloud-based pay-as-you-go models. Moore’s Law inevitably means disruption – at least for a few years yet!
Voice and data communications, once the preserve of highly regulated and state-owned monopolies, has become a free for all. We expect to be able to connect anywhere and at any time and a host of new wireless technologies have emerged linking the last few miles and even the last few metres. Large chunks of the radio spectrum are also being repurposed and resold. But what does all this mean for the M2M/IoT sector? Some players will try a business as usual approach, but corporate inertia and legacy business and technology models will stifle muchneeded innovation. However, others will quickly see and exploit the immense opportunities emerging from these disruptive forces.
M2M Now’s Alun Lewis caught up with Stream Technologies founder and CEO, Nigel Chadwick, to explore how his company has responded to this tightly intertwined mix of technology and commercial change, creating in the process – and in his words – “the Uber model for IoT”.
M2M Now: Nigel – you co-founded Stream around fifteen years ago. What are the most significant changes between then and now in both technologies and market needs – and how has the company differentiated itself in response to them?
NC: Market needs and technologies have both shifted dramatically over the past 15 years. What was early stage M2M, based largely around small data via text messaging, has evolved to include GPRS, 3G, 4G, satellite and, increasingly, Low Power Radio Networks (LPRN). We have also witnessed a surge in platform technologies, although only a relatively small number of players have developed platforms that manage the connectivity layer.
Market needs will be extremely diverse across the global pool of 50 billion devices by 2020 predicted by Cisco. As end points grow and friction is removed from connectivity processes, the range and scale of organisations deploying IoT over multiple network types, across and within multiple national boundaries, will increase. For the past decade, we believe that Total Cost of Ownership (TCO) has been a major barrier to high velocity scaling. If the forecasted billions of connected devices are to become a reality then TCO must be radically reduced. Connectivity infrastructures are currently fragmented – if these billions of connections are to be enabled, managed and billed, they must be radically simplified and much more efficient.
Stream has focused its R&D on the TCO challenge for over a decade, giving us a uniquely different technology. Our IoT-X™ platform enables Mobile Network Operators (MNOs) across the world to deliver high quality and simple to manage connections across all M2M verticals – from high data capacity requirements such as those relating to digital media/CCTV, through to small data such as sensors and smart meters.
Operating as a highly specialist MVNO for nearly 15 years means we are now strongly positioned as an MNO ‘enabler’ through our IoT-X platform which MNOs can adopt to manage their M2M connections. IoT-X is agnostic to wireless layers, so supports the management and billing of satellite, LPRN and WiFi as well as cellular. Our evolved backhaul infrastructure design, monitoring/analytics tools and highly experienced technical and operations teams, have created something special. In particular, MNOs and others looking to deploy and manage LPRN gain an ‘out of the box’ management platform at minimal cost.
M2M Now: In much of your company material you stress the need to support a full portfolio of connectivity options, in particular emerging LPRN and WiFi. What’s your thinking on this and the implications for Stream’s IoT-X platform strategy?
NC: History is littered with new technology winners and losers. Both markets and legacy ways of doing things get disrupted, with new technologies and business models evolving that result in a major acceleration in adoption, as redundant technologies and commercial models are replaced.
I believe Stream’s IoT-X is poised to become a disruptive technology in IoT: it’s next generation technology and so radically different from anything else out there.
Stream for the past decade has been focused on simplifying IoT connectivity management layers within the IoT stack – the key to enabling billions of connections. With IoT-X, we’re not talking about a platform designed to manage connectivity for hundreds of millions of endpoints and devices, but one ready for billions using all types of wireless and non-wireless connectivity. This agnosticism has enabled true scaling. Stream’s early roots were in cellular connectivity but, compared with LPRN, the TCO of cellular connectivity per end point is still high. LPRN is coming over the horizon fast, bringing lowered costs and exponentially accelerating deployments. LPRN also introduces new challenges to connectivity management not only in respect of LPRN itself, but also the backhauling element – whereby multiple hops might also include satellite, cellular or WiFi. Stream’s technology drives down TCO and our expertise and technology are ready to be applied to all layers.
IoT-X also has an integral powerful billing engine, with algorithms capable of processing many variations in billing structures, enabling the innovative monetisation of end point deployments that transit data over LPRN, Wi-Fi, satellite and traditional cellular solutions. The prospect of monetising – down to a micro-payment levels – across vast numbers of devices and billions of chargeable events is a truly exciting opportunity. This will be incredibly disruptive and is the key to exponential growth.
M2M Now: Scalability at both ends of the M2M/IoT market is an important challenge, especially if we’re to drive true mass market adoption and enable small, new and innovative players to disrupt their own particular sectors. How have you adapted the Stream solution to suit such a diverse and often demanding customer base?
NC: Few tend to talk about scalability in the context of servicing a myriad of smaller deployments. There will always be SMEs with a limited deployment of IoT, as well as companies requiring data transfer services for R&D or beta stage commercialisations. The consumer sector has yet to really adopt IoT, but when this happens we will face completely different challenges. Just as large scale deployments require resilient and easy to manage connectivity, these micro-scale deployments will also require this same service level. More so in fact, as their technical resources will be limited, though they can benefit from Stream’s technical expertise and agnostic systems that have evolved to overcome the many challenges presented by multiple connectivity protocols. We’re seeing substantial interest in IoT-X from companies worldwide who seek a management and billing platform that can integrate with LPRN based deployments. This typically includes sensorbased technologies as well as more traditional M2M solutions including smart meters.
While the expertise within both our team and our software covers cellular, satellite and LPRN, we’re also focused on ensuring resilient and reliable data transit, including its streamlined and efficient management and monetisation. Our systems have evolved to meet scaling requirements in both directions – massive and micro.
M2M Now: Ensuring a high quality customer experience – wherever they sit on increasingly complex and multidimensional value and service chains – is a critically important aspect of M2M/IoT success. What’s your strategy – especially towards small new entrants needing support?
NC: Customer experience is uppermost within Stream’s delivery programme. Operating as a data transit specialist means connectivity must be resilient and reliable, with uncompromised data getting from A to B when it is scheduled to do so. Enterprise clients seek the very best technical and operational support and our team’s incredible depth of understanding across all aspects and types of IoT connectivity provides this. Expert advice is provided ahead of solution deployment, assuring success in scaling.
Crucially, Stream Technologies is also supporting deployment by MNOs and emerging LPRNs of new networks globally via IoT-X. This is a unique situation and technology play, vesting our know-how and technologies with MNOs, enabling them to replicate the same level of customer experience that Stream’s renowned for. Cellular MNOs and other operators can gain an immediate competitive advantage in their local IoT sector through this. IoT-X as an out-of-the-box solution is invaluable to adopters as they gain immediate access to the partnership eco-system within IoT-X, choosing from a range of integrated value-add partner applications and solution options.
By ‘small entrants’, you probably mean SME clients. We however see this also as applying to MNOs who have limited budgets and IoT expertise, but who want to compete in their local M2M markets. They need to ensure effective connectivity management via an enablement platform. Our solution provides this, but also goes one stage further. When another network operator adopts IoT-X, so too does Stream’s footprint expand into that geography – meaning local network services become available for all enterprise customers of Stream and all other incumbent IoT-X adopters. This is a uniquely valuable global proposition as IoT deployments accelerate.
M2M Now: Pricing and billing are key issues. What strategies and technologies is Stream adopting – or have you any insights into particular price points or contract types that will prove especially attractive to this cohort?
NC: Let’s take technology first. If IoT network operators and adopters can’t bill for IoT enabled products and services, they can’t properly monetise them and get full ROI. Stream’s billing and rating capabilities allow consolidation regardless of network technology via product bundles, hardware as a service, and so on. Hundreds of our customers enjoy exactly this type of billing capability.
On the topic of pricing, this is critical for widespread IoT adoption. Technology hasn’t been the growth curve inhibitor for the past few years – it’s been cost. Although costs for devices and data plans have come down, many still charge what the market will bear, stifling growth and keeping deployments in the low millions. We’ve also been hearing about Software Defined Networking (SDN) – but where are the cost savings? We haven’t seen it and future adopters of IoT solutions haven’t either. Contrast this with the impact Amazon Web Services has had on the data centre market or Uber is having in transport.
At Stream we built our financial models around the IoT scale pricing concept. We do cellular connectivity better and cellular will be one of the key connectivity methods – but we’ve also expanded our best of breed capability out to other network technologies and we did it with billions in mind using ‘utility computing scale’ which implies scalable software business models. This is ultimately about utility computing – connecting billions.
Call us idealists, but we clearly see which models have worked and which haven’t. Our goal is to help forward-thinking network operators and their customers realise the fullest benefits of IoT and a big part of that is reducing cost barriers, regardless of the underlying network technologies.