Regional Workshop for Africa on

Developing the ICT ecosystem to harness Internet-

Internet-of
of--Things (IoT
(IoT))
28--30 June 2017, Mauritius
28

Business models of IoT: from

suppliers to customer

Dr. Imen BEN CHAABANE

International
Telecommunication
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 Old business models
The basic business models that currently exist in the IoT
and IIoT space are:
1. Retail sales : Equipment or device manufacturer
expends its own money or raises financing to build
products which are then sold to customers. The
equipment or device manufacturer only captures value
during that one transaction, the expectation is that there
is a positive margin between revenue and expenses and
that customers will buy more of the same product or
other products.
2. Product lease/Subscription : Instead of selling the
machine/device, the vendor leases the product to the
customer.

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 New models

It’s imperative that new businesses

and startups should explore new
models for value creation and
capture. The new business models
will stem from the increased
interactions afforded by IoT and IIoT
(Industrial IoT) devices.

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 New models
Capturing value from human factors, analysis and
machine interaction

An example will best serve here. Some business models can lie
at the intersection of the 03 elements above.

There is a business model where a customer pays for

insights drawn from the interactions. In the case of Proxxi
the device keeps the technician safe by alerting him/her
and the control room when unsafe conditions are detected.

We Call it : pay
pay--per
per--warning.

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Business Model for IoT

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Business Model : from suppliers to
customer

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Business Model : from suppliers to
customer

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 The main business Models
There are 5 main business models enabled by IoT between the
IoT company and the customer …

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 The main business Models
…and can be compared in terms of revenue structure and
device ownership

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Revenue sharing

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Revenue sharing

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Costs savings sharing

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Costs savings sharing

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Product - sharing

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Product - sharing

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Product-as-a-Service

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Product-as-a-Service

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Performance-as-a-product

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Performance-as-a-product

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Summary : business models

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Case study 1 : Farm water
monitoring

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Case study 1 : Farm water
monitoring

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Case study 1 : Farm water
monitoring

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 Farm water monitoring –
most likely business models

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Farm water monitoring

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Case of study 2 : Elderly care
monitoring

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Case of study 2 : Elderly care
monitoring

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Case of study 2 : Elderly care
monitoring

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Elderly care monitoring-most
likely business models

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Elderly care monitoring

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Privacy and data protection

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Case study 3 : smart public
garbage bin

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Case study 3 : smart public
garbage bin

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Case study 3 : smart public
garbage bin

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Smart public garbage bin-Most
likely business models

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Smart public garbage bin

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Smart public garbage bin

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Case study 4 : Security alarms

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Case study 4 : Security alarms

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Case study 4 : Security alarms

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Security alarms-Most likely
business models

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Case study 4 : Security alarms

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Traffic Management

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 Example of commercial Model
Society Radio Coverage Customer Target Network Price /
Protocol Flow Commercial
Model

UNB (Ultra Narrow Five countries Sigfox offers to 100 bits per Offer by
Band) with covered (France, any company, second - subscription
proprietary radio Spain, United from start-up to Upstream: Each integrating
communication Kingdom, Portugal, large account, device can send communications
protocol layer. Netherlands) and who wants to between zero and and additional
Objects can be seven countries in develop 140 messages per services including
addressed with the process of connected B2C or day and each consulting and
standard protocols deployment B2B solutions. message can development.
from the Internet: (Belgium,
Business sectors: contain up to 12 Price: from 1 to 8
HTTP (S) and MOU Denmark,
emergency and bytes of data - E / object per
as well as the Luxembourg,
security services, Downlink: up to 4 year, depending
ability to create IP Czech Republic,
addresses for each Italy, Ireland and intelligent messages per day on the volume of
object. the United States). buildings, per object. messages
Target of 60 automotive, exchanged by the
countries covered transportation. devices and the
by 2017. number of
connected
devices.

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Society Radio Coverage Customer Target Network Price /
Protocol Flow Commercial
Model

LoRaWAN with 17 agglomerations Companies of all Companies of all In addition to its

Live Objects, a in the first quarter sizes, ranging from sizes, ranging from offerings of
data management of 2016 (Angers, start-ups to SMEs, start-ups to SMEs, Machine to
platform Avignon, to large to large Machine
integrating an Bordeaux, Douai companies. The companies. The connectivity,
H11P type API and Lens, main sectors or main sectors or Orange will offer
(object Grenoble, Lille, sectors concerned sectors concerned LoRa connectivity
registration, Lyon, Marseille, are: smart cities are: smart cities offers whose prices
sending of Montpellier, (including smart (including smart will depend on the
commands, etc.) Nantes, Nice, buildings), energy, buildings), energy, number of objects
and an MQTT-type Paris, Rennes, Of industry, logistics industry, logistics to be connected,
API (receiving and health. and health. the associated
messages from
French territory . services and, with
connected objects a subscription
to the client model per object.
application server
).

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Society Radio Coverage Customer Target Network Price /
Protocol Flow Commercial
Model
LoRaWAN The Large Network Subscriptio
with data network accounts, based on n per object
management deployed by SMEs, start- LoRaWAN connected
platform with ups or
standard-
Bouygues administratio
technology to the
compliant Telecom will ns. All types that allows network
architecture cover 50% of B2C variable with a price
OneM2M of the projects like data rates ranging
integrates population B2B, from the ranging from 1 €
several in the simple from 0.3 per month
protocols for summer of request of kbps to 50 to 1 € per
the transfer connectivity
of data
2016 and to the
kbps in year
including the the entire complete both uplink depending
MOU protocol territory at project with and on the
as well as the end of storage and downlink quantity of
REST-type 2016. processing of channels. objects.
APIs. the data for a
business use
(energy,
transport,
localization
...)
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Society Radio Protocol Coverage Customer Network Flow Price /
Target Commercial
Model

UNB-LoRa 18 private Future: No No

bi-mode networks any information information
network, deployed company at this at this
around the
with that wishes time. time.
world. The
proprietary first public to add
radio network to value to its
communica be deployed customers
tion in France on by taking
protocol TDF's advantage
layer on infrastructur of the Iot
the UNB e (10,000 But
sites for
part. No initially:
radio
further equipment positioning
information and mainly on
available. television). SME
Objective: to projects
cover 100% and start-
of cities with ups.
more than
10000
inhabitants
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Society Radio Coverage Customer Target Network Price /
Protocol Flow Commercial
Model

LoRaWAN Several Companies Network Prices not

with HTTP European and based on finalized.
(S) and cities from individuals. LoRaqui Starting at
MQTT September No further technology 50 cents
and the information allows per
main available. variable connected
European data rates object per
cities ranging year.
before the from 0.3
end of kbps to
2016. 50kbps in
both uplink
and
downlink
channels.

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1. IoT has opened up limitless possibilities for businesses and
brands as they seek to build novel connections to their
customers
2. While Business-to-Consumer (B2C) use cases seem to
corner most of the attention, mass adoption of IoT in the B2C
arena has run into its own set of challenges. Affordability is a
concern.
3. B2B use cases are already popular and growing more so by
the day. Companies are using IoT to connect to their
customers, suppliers and vendors in a big way.
4. Be it B2B, B2C or B2B2C, the main challenge facing IoT
adoption is in finding successful use case studies that can be
replicated by the industry.
5. Moving the IoT industry from early adopters to mass market
will depend on applications of the technology, rather than the
technology itself.
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 conclusion
1. While the personal connected device/IoT
market seems to be struggling right now,
there is some value to be created and
captured as the industry matures and
better use cases are defined.
2. On the other hand, the IIoT space is
seeing a convergence in interest from the
customers and clear use cases that
provide value.

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Thanks for your attention

Imen BEN CHAABANE

Email : benchaab@ties.itu.int

International
Telecommunication
Committed to connecting the world Union