For Enterprise IoT Its Invest As You Go

September 16, 2015

For enterprises, the Internet of Things has opened the door to numerous new technologies such as IoT Application Enablement Platforms, machine learning, and low-power wide-area networks. This phenomenon has also provided enterprises with a substantial number of new and improved opportunities, including new revenue streams, business models, and customer experiences. The Internet of Things is transforming industries and changing markets – prompting executives to ask: ‘How much is this new technology going to cost our business?

The intriguing and short answer is that for Enterprise IoT, the advice is to invest as you go. Whereas most new technologies traditionally involve a significant investment of capital and resources upfront, the IoT is different. Figure 1 below captures these high-level differences


Figure 1: Comparing the ‘costs’ of traditional IT and operational technology (OT) with the Internet of Things [Source: Machina Research, 2015]

Let’s explore some of these points in more detail.

Low Entry Costs

In contrast to traditional IT investments, where significant upfront capital expenditure is recovered by enterprises over time, technology providers in the Internet of Things have adopted pricing models that are aligned with start-up companies’ budgets. These models offer low entry costs or start-up fees as well as scalability according to usage. This approach has benefited small and medium-sized enterprises and solution providers, and has in many ways contributed to the accelerated growth and adoption of IoT applications in the market.

Open and Reusable Programming Modules

Rather than being locked in to narrowly defined architectures, technologies in the Internet of Things have looked to use and reuse modules across applications and industry verticals. This saves on both programming effort and development time, and also opens up the benefits of working across different silos within a single infrastructure.

No Longer a Prisoner to Projects

How many times have executives been told that an IT project has to proceed because the losses would be too substantial to stop now? In contrast, developers of IoT applications have adopted new approaches such as agile application development. This approach encourages rapid and flexible response to change and, while not necessarily advocating the immediate termination of a project, retains enough flexibility to explore new avenues when success is not in sight.

Costly upfront capital expenditure and licensing fees are becoming a thing of the past. With scalability, agility, and flexibility being built into technologies and business models in the Internet of Things, enterprises are advised to pursue Enterprise IoT on an ‘invest-as-you-go’ basis.