An IoT Strategy for Hardware Brands

The Internet of Things is a technology trend with disruptive potential to create a paradigm shift in the way all physical products are designed, used and sold. It will create a bridge between the digital and physical worlds, increasing and providing new user value. In doing so it will create new products, open new markets and enable new business models.

The expectation of exponential growth predicted for the IoT comes from the depth of value it can offer combined with the breadth of applications this value is applicable to. The advantages of the IoT stem from several inherent characteristics:

• Scale: Metcalfe’s Law states that states that the value of an interconnected network is equal to the square of the number of devices connected to it. Reed’s Law asserts that the utility of networks allowing sub-groups (which IP protocols do) scale exponentially with size because the number of possible sub-groups [1]. Effectively, the more devices that are connected, the more potential value the network can provide through new features.

• Social: Through M2M, connecting will real people will be easier than ever before with social interactions being available at any time in any place through a myriad of different ways. The IoT will be able to achieve new levels of social immersion. Mark Zuckerberg, Facebook CEO, envisions an “internet of people” [2].

• Personal: Through quantifying the most subjective aspects of people and achieving a semantic understanding of our world by leveraging data, connected devices will be more personal, pleasurable & meaningfully, the pinnacle of Stephen P Anderson’s pyramid of user interaction design [3].

Stephen P Anderson’s pyramid of user interaction design [3]

• Automation: The advantage of data is the relevant and meaningful information that can be derived from it. More information will enable increasingly complex decision making by machine processes, increasing efficiency & effectiveness of existing automation and allowing more processes to be automated. Common advantages of automation are increased quality, consistency, reliability and throughput while decreasing waste, processing costs and human effort costs. In addition, Bob Metcalfe, inventor of Ethernet, has stated previously that a good experience with the IoT will be “not so much good UX, but no UX at all… the IoT should disappear into the woodwork, even faster than Ethernet has” [4]. Mark Weiser, chief technologist at the Xerox Palo Alto Research Centre in 1991 described “the most profound technologies … those that disappear.“ [5]

• Physicality: What really sets the IoT apart from other technology trends is its ability to affect the physical world. Devices are able to act on processed data and alter our reality through actuators, improving quality of life and quality of an environment.

All operations on the IoT can be divided into four categories: communication, data creation, data analysis and actuation. All four are vital to conducting value adding activities. It has already been established that the more connections, the better, therefore competition will primarily occur through the latter three.

• Data Creation – as sensors advance, they are able to generate data on the environment with increasing granularity due to numbers and increasing quality, providing better raw material for analysis.

• Data Analysis – refers to the processing of data to answer specific questions, thereby creating useful information from which to derive a decision.

• Actuation – devices which are able to act on the environment in useful ways are obviously instrumental to creating value from the IoT. The more capable an actuator is, the more value it can provide. Like data creation, the comes down to increasing quantity or increasing quality.

Spend a moment with any designer and it is obvious that most physical products could be made better in some way by connecting them, therefore the potential value the IoT offers must be utilised by hardware brands to ‘disrupt or be disrupted’. In the home, the IoT is likely to offer most value by creating the best environmental experience and this is going to require the best actuators.

Hardware is hard, and brands known for quality physical products and with the most experience designing and making them in a sustainable manner are uniquely positioned to take advantage of this disruption by focusing on making the best actuators.

This is a B2C strategy to drive growth at premium hardware brands by utilising the IoT to improve physical products. It aims to position a hardware brand as a key player in the smart home.

Premium hardware brands must leverage their existing position to become an indispensable element of every great home environment by developing better actuators.

1. Unique & protectable technology should be used to create a core actuator on which a product offering class leading user value is based.

2. Products from the company must leverage each other to improve and extend this user value, enabling a second purchase.

3. No brand can assume any home will have only their products; Products must leverage off-brand products to add value and extend their applicability.

4. In order to offer the most value and widest applicability, brands must offer their unique benefits to all 3rd party products and services in a free and open way. This may require partnership with many different APIs to ensure that the necessary commands exist to control unique features.

The obvious problem for any company following this strategy is: “How do you keep a curated user experience while allowing 3rd parties to control your product?”. The advantages of scale mean that comparability should never be reduced for any mass market consumer product. Instead, provide or partner with the best user interface for interacting with your product and others products, ensuring your brands curated experience remains the key touch-point for customers.

Notes on a few other important issues:

• Quality Sensors – Due to the advantages of scale, more data equates to more potential information which can be turned into user value. As a result of this, where a business case can be made for sensors that provide richer data streams, for instance a camera over a PIR or a spectral sensor over a light dependent resistor, it should be.

• Security & Privacy – Security and privacy appear to be directly opposed to the philosophy of scale. The more open connections are made and the more data is shared, the greater the potential for things to go wrong. This means there is an inherent trade-off between user value and security and privacy at time. To tackle this issue without curtailing growth, focus should be put on ensuring customers understand the trade-off they are making and actively consent to the risk in light of the user value benefits connected products can provide. The best security possible can then be built within these given constraints. The key to this strategy is having an open and honest dialogue with customers.

• The Backbone of the Network – A network is an interconnection of a group of individual elements. The part of a network with the largest number of strategic interconnections between devices and sub-networks is known as the network backbone. It provides the principal routes of communication. An example of a global computer network is the internet. All of BT’s revenue streams (£18.017 Billion in 2013) are based on owing backbone infrastructure [1]. The majority of data on the internet was previously made by people, machine to machine communication has removed this bottleneck; speaking in 2010, Eric Schmidt said “Every two days now we create as much information as we did from the dawn of civilization up until 2003“ [2]. The backbone of the IoT is likely to be an essential part of every smart home. Many technologies and physical products are vying for this title, the winners will be the first ones to achieve scale. Products must be compatible with these technologies. Ones to watch are:

Lighting products specifically offer a number of unique attributes which may be advantageous and are used as an example to illustrate this strategy. Lighting products have potential to be a core part of any smart home. They are offer significant opportunity as both as both an actuator and a network device yet are underutilised. The lighting paradigm has not changed since Edison invented the light bulb in 1878, this form factor is commoditized with prices dropping 9% per year [1]. New evidence for the health and well-being effects of light and the potential of the IoT will shake up this market, providing opportunity for new entrants. The B2C market has been largely ignored by incumbents, just 35% of New York consumers understood the term lumen [2], yet Mckinsey predict the global lighting market will be worth $138 billion by 2020.

Lighting as a Network Device

• Good Location for RF & Sensors – Top and centre of a room is the ideal position for most RF and sensors.

• Powered Fitting – Reduces restrictions on the technology inside allows

• Bulbs are Limiting – Optimisation for throughput and range.

• Ubiquitous – Artificial light is used in every room of every building allowing excellent coverage and very granular of sensors.

• Distributed – Lots of individual nodes are suited to mesh networks, multiple routes between devices provide the shortest direct path between nodes, reducing latency and increase robustness. An ideal platform for short wavelength RF such as WiGig or wireless power.

• Modular – Many, small and low cost nodes make a network easily scalable, customisable and upgradable, something that will only become more important as throughput and reliability requirements grow.

Lighting as an Actuator

• Bulbs are Limiting – A bulb form-factor limits the capability of a lighting actuator, moving to fittings provide opportunity to do more with light.

• New Health and Well-being Science – Emerging evidence indicates light is able to create significant physiological and psychological effects with light such as entrainment to a sleep wake cycle via iPRGC photoreceptors[3].

• Not Natural – The delighting effect of a sunny day is a universal phenomenon and as we evolved under natural light, it is likely to be the most healthy for us, yet artificial light is nothing like natural light.

• Highly Segmented – The lighting market is highly segmented into many specialist product categories, one dynamic product could do the job of multiple products.

• New Technologies Ready – UV can be used for serialisation, IR for heating, Lifi could provide new spectrum for communication, a myriad of technologies (e.g. blue laser diodes & QDs) increase spectral and spatial control.

Used as a corner stone for a B2C IoT strategy, lighting has two specific issues which are addressed here:

• Socket Saturation: as LED lifetimes get longer, the volume of products bought each year drops. This is not an issue if product replacement is driven by meaningful physical technology innovations, particularly important as lamps give way to fittings.

• The Switch Problem: Light switches cut the power to sockets. A smart light cant function if it is off. There are 3 non-mutually exclusive solutions:

  • Using the existing switch with new wiring as a signal switch

  • Using a new switch/backplate on the same wiring as a signal switch

  • Using a new switch/backplate as a wireless signal switch

References

1. www.p2pfoundation.net/Reed’s_Law

2. www.stanforddaily.com/2014/02/07/mark-zuckerberg-and-the-internet-of-people/

3. Stephen P. Anderson, Seductive Interaction Design, 2011

4. www.forbes.com/sites/gilpress/2014/09/21/the-new-apple-wristop-computer-a-missed-opportunity-to-defi ne-the-internet-of-things/

5. Mark Weisner, The Computer for the 21st Century, 1991

6. BT annual report, 2013 [2]http://techcrunch.com/2010/08/04/schmidt-data/

7. McKinsey&Company (2012) Lighting the way: Perspectives on the global lighting market, London: McKinsey&Company

8. Nevius, M. et. al. (2012) ‘Consumer Understanding of Key Lighting Facts’, ACEEE Study on Energy Efficiency in Buildings, 2012(6), pp. 231.

9. LightingEurope & IALD (2017) ‘Joint Position Paper on Human Centric Lighting’