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Monetizing the ‘Internet of Things’What You Need to Know Now

Brendan O’BrienCo-founder & Chief Evangelist

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If you think that the Internet has changed your life, think again. The IoT is about to change it all over again!

— Brendan O’Brien

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How Big will the ‘Internet of Things’ be?

“...Google is installing extremely fast gigabit internet infrastructure when the average person needs 200x less speed because of the future of the Internet of Things...” – Daily Infographic, March 2014

>$50Billion

DevicesBy 2020

______ Your Guess

$7.1 Trillion

– IDC

“...all those billions of smart, connected gadgets such as Google’s smart glasses… should generate a staggering $7.1 trillion in annual sales by 2020.“

– IDC , June 2014

“Cisco’s Internet of Things Group (IOTG) predicts there will be over 50 billion connected devices by 2020.”

– Cisco , November 2013

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When will firms implement an IoT solution?

RECENT SURVEY RESULTS:

43% have implemented or will begin

implementation within

the next 12 months

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What is MoT NOT About?

“ The good news is you can get to market quickly. The bad news is so can everyone else.”

– Brendan O’Brien, Aria Systems June 2014

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What is MoT ACTUALLY About?

C U S T O M E R R E L AT I O N S H I P T I M E L I N E

Event 1 Event 2 Event 3 Event 4 Event 5 Event 6

Services enabled for people!

“ The IoT transformation is shifting the value and differentiation away from hardware and to software, cloud, and services, and spawning entirely new business models.”

– Andres Rosello, Forbes, March 2014

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What DO you need to do?

“You [will] need services [to] take that [IoT] intelligence and present it to the consumer in a way that’s easy to use and meaningful.” – Rajeev Kumar, Dir. Worldwide Marketing and Business Development for microcontrollers, Freescale Semiconductors

All Contents © 2014 Aria Systems

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Key capabilities you need to Monetize IoT

Gather Consumption Data

Business Services

Control Configurations

Code Free Roll-out

Enabling Technologies

All Contents © 2014 Aria Systems

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Enabling Technologies

Gather Consumption Data

Business Services

Control Configurations

Code Free Roll-out

Enabling Technologies

Enabling Technologies

• Cheap to build

• Competitive landscape

All Contents © 2014 Aria Systems

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Business Services

Gather Consumption Data

Business Services

Control Configurations

Codeless Roll-out

Enabling Technologies

Business Services

• Pricing & Packaging

• Personalized Offerings

• Fast and Agile

All Contents © 2014 Aria Systems

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Consumption Data

Consumption Data

Business Services

Control Configurations

Codeless Roll-out

Enabling Technologies

Consumption Data• Gather

• Manage

• Measure

• Load

• Analyze

All Contents © 2014 Aria Systems

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Harnessing the Data Explosion is essential

“Businesses that don’t plan carefully for IoT will be overwhelmed with the volume and variety of data that IoT will generate.” – “An Introduction to the Internet of Things (IoT),Lopez Research LLC

“IoT will stump IT until clouds and big data come aboard” – EMC, Stephen Lawson

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The consumption data considerations

• Where is your data and where will it have to be?

• Are you prepared for “Bigger Data”?

• Will current data security standards scale?

• Are comm and format standards in place and usable?

All Contents © 2014 Aria Systems

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Configurations

Gather Consumption Data

Business Services

Control Configurations

Codeless Roll-out

Enabling Technologies

Control Configurations• Configuration

• Rules

• Coding

• Beware too much coding

All Contents © 2014 Aria Systems

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The Life of a Product

Time

Pro

fits

Rapid Growth Declining Profitability

Peak Profitability

Window

Standard Distribution of Product/Service profitability over a bell curve.

Innovation Commoditization

Obsolescence

CONFIDENTIAL Not For distribution All Contents © 2014 Aria Systems

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The Cost of Delay

• Shortens the window for peak profitability

• Creates EARLY unrecoverable sales losses

• Erodes Average Unit Price (AUP) over the entire product lifecycle

• Product lifecycle End-of-Life (EOL) date doesn’t change

CONFIDENTIAL Not For distribution All Contents © 2014 Aria Systems

Pro

fits

Time

Unrecoverable Sales from delay

AUP Erosion

Shorter Peak Profitability

WindowScheduled

LaunchActual Launch

LaunchDelay

Product EOL stays constant

AUP Erosion Example: iTunes - $.99

Walmart - $.55RCN

Verizon

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Codeless Roll-out

Gather Consumption Data

Business Services

Control Configurations

Code Free Roll-out

Enabling Technologies

Code Free Roll-out• Not new products

• Re-bundling/Re-packaging/Re-pricing

All Contents © 2014 Aria Systems

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Who is doing this already?

• Didi Taxi, the Uber of China

– 100MM+Users = 5MM + Daily Rides, +15x in 77 days Driven by WeChat Payment Integration & Subsidy*

*TechCrunch The Most Important Insights from Mary Meeker’s 2014 Internet Trends Report

All Contents © 2014 Aria Systems

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More…

• Ingersoll-Rand, home security market

–Offers electronic locks for a $10 a month subscription to monitor a home from PCs, tablets, smart phones. Controls > 1,000 devices from scores of manufacturers = $12.3M in total sales in 2013*

*The Big Book of Recurring Revenue

Innovators, Aria Systems, May

2014All Contents © 2014 Aria Systems

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The Truth for ‘Monetization of Things’

• IoT is here now, time to prepare

• MoT = Service, not the device

• It’s about consumption data; collecting and applying it

– It will drive intelligent go-to-market decisions, even if it doesn’t directly influence a bill!

• Enabling technologies are cheap; that’s good and bad

– Your biggest competitive differentiator will be pricing and packaging, and you need to move quickly and codelessly

All Contents © 2014 Aria Systems

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Preparing for the Monetization of Things

• Focus on services as much if not more than devices

• Get your data management, collection, reporting, attribution resolved, and measure as much data as you can

• Acquire the technology to analyze consumption data and create targeted offerings… Quickly!

All Contents © 2014 Aria Systems

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Aria provides a platform to. . .

Make More Money

• Optimizing the lifetime value of customer relationships

• Keep the business growing and valued

Keep Customers Engaged

• Delivering a consistent high- quality customer experience

• Customer information always presented in context

RelationshipCommerce

ActiveOrchestration

AdaptiveSelling

Single Customer

View

Manage Things More Easily

• It’s in the Cloud!

• Pushes Information

• No rip and replace

EnterpriseCloud

Solve Big Problems

• Handles scale and complexity, security, reliability, compliance

• High Performance Operation

CONFIDENTIAL Not For distribution All Contents © 2014 Aria Systems

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www.ariasystems.comBrendan O’Brien

bobrien@ariasystems.com@brendan0606/brendanobrienaria

CONFIDENTIAL Not For distribution All Contents © 2014 Aria Systems

Thank You!