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Forrester VP: Solution Providers Need To Understand IoT 'Buyers' And What Their Motivations -- And Reservations -- Are

Frank Gillett, vice president and principal analyst at Forrester Research, speaks at IoTConnex about the three types of IoT 'buyers' and why each is looking at the technology.

Interest in the Internet of Things is at an all-time high but complexities around integration, security and cost will send customers running to solution providers for help, said Frank Gillett, vice president and principal analyst at Forrester Research.

"It's complicated for companies to actually implement [IoT ] … they find an awful lot of different opportunities or use cases, a variety of stakeholders, and a wide variety of devices and technologies. ... There's a lot of complexity involved," said Gillett, speaking Wednesday at IoTConnex, a virtual conference hosted by CRN parent The Channel Company.

More IoT opportunities for solution providers are popping up as adoption continues to grow. According to a Forrester survey of global telecommunications decision-makers, in 2016 52 percent of respondents said they were planning to use or are using IoT applications, while 27 percent said they were interested.

[Related: IoTConnex Virtual Conference 2017]

In 2017, those numbers went up – 55 percent of respondents said they were planning to use or are using IoT applications, and 40 percent said they were interested.

The interest is there, but it’s important for solution providers and systems integrators to look specifically at who the buyers are to better understand what they would use IoT for, what motivates them to spend money on IoT, and what reservations they have around IoT projects, said Gillett.

Of those who are planning to use IoT in the next 12 months, utilities and telecom were the most popular applications but manufacturing and construction also were top of mind, according to the Forrester survey.

A typical IoT buyer can be one of three types of customers, said Gillett. The first type of customer is one who designs IoT into a ’thing’ and then enables a different party to operate and use it, such as a customer who might design durable goods like coffee makers, or one who may design entire IoT ’environments’ like smart cities or buildings.

’Once it’s out there in use, it’s generating data, and the company that created the product gets access to that data, but there’s also a lot of interest on the outside from other companies who might want to use that data if it’s from farms or cities,’ said Gillett.

Another type of buyer is the ’operator,’ who works to deploy IoT applications across multiple assets, including connecting digital stores, climate monitoring of offices or workspaces, and connecting manufacturing lines and truck fleets.

Finally, the third type of buyer is the ’consumer’ – these are the types of buyers who consume sources of IoT data from connected devices like activity trackers, track vehicle mileage, or monitor pest sensors for agriculture verticals.


These consumers are necessary for early IoT adopters because they can help them map the customer and employee journeys to find IoT-enabled sources emerging across the ecosystem, said Gillett.

All of these types of buyers ’should be assessing [IoT] scenarios now,’ said Gillett – but there are still hoops customers need to jump through as they deploy IoT applications.

One of the biggest concerns for customers is security, with 38 percent of the Forrester survey respondents listing it as their top concern with IoT technology. Customers also have concerns around integration challenges, total cost, and lack of technology maturity, said Gillett.

From a business standpoint, both solution providers and customers will need to transition their business models to better incorporate going from a one-time transaction to ongoing relationships, as well as going from product-centric designs to ’service-centric experiences.’

One of the biggest issues that solution providers and customers need to work through is the fact that IoT applications can best be used to create completely new offerings and services, said Gillett.

’These companies need to look beyond optimization of physical assets and cost savings to think about innovating and creating new offerings and services around their value proposition,’ he said. ’This involves using IoT to completely rethink what you do.’

Shanin Pirooz, chief technology officer at San Jose, Calif.-based solution provider DataEndure, agreed that customers will benefit from looking at new business models. A big challenge, however, is working with customers to better understand the value behind the data so that they aren’t merely collecting useless data, but instead will be able to use IoT analytics tools to gather information that will solve business issues.

’IoT is basically the evolution of all of the things that we built … devices that give us the ability to write applications that are constantly sending analytics information,’ he said. ’The problem is all that data is just going into a massive cesspool of data. So IoT is collecting tons of data, but without the analytics and machine learning … it’s not information, it’s just data.’

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