Enterprises abandon IoT transformation expectations as hype fades

Image credit: EtiAmmos /

As IoT hype deflates, customers and vendors are overwhelmingly abandoning expectations for big IoT transformation projects to refocus on incremental adoption of smaller, tactical IoT tools, according to Technology Business Research (TBR).

TBR’s 1Q18 Commercial IoT Market Landscape finds that customers are evolving to understand IoT as two interconnected techniques: (1) connected operations for their industry-specific operational needs, and (2) connected business tools for their horizontal business functions. In addition to serving both IoT techniques, vendors will focus on delivering user-friendly components and prepackaged IoT applications and services that help customers eliminate IoT sprawl and get their work done.

IoT is creating a sea change in how technology can drive business. Although IoT will ultimately drive large percentages of IT vendor revenue, IoT-driven revenue will increase only at a moderate rate for many years. This is challenging vendors to refine their IoT go-to-market strategies to be as efficient as possible. Vendors must master a huge and diverse partner ecosystem, demonstrate the value of their products and services in multi-vendor solutions, and become customer-standard vendors for IoT components, TBR says.

Some examples of this shift in 2017 include:

  • SAP’s Leonardo Live in November 2017 featured very little about the technology, instead focusing more on the business outcomes that can be achieved with various implementations of innovative technologies such as IoT and machine learning. Customer stories and general discussions on business disruption and transformation replaced the traditional product announcements and demonstrations. This fundamental change from SAP’s other events shows that SAP is evolving to guide customers through their own transformations.
  • To leverage Predix to pave the way to positive changes for end customers, GE Digital refocused around the prepackaging of industrial IoT (IIoT) applications to enable customers to build their own system of systems in 2H17. This makes the company’s ecosystem — built around its experience developing software for operating vertical-specific machinery along with its partnerships with fellow industrials and IT-oriented vendors such as Microsoft — its differentiator. GE’s new ecosystem is vital as very few customers will commit to transformation in one sweeping change. Instead, customers are likely to follow a series of steps toward their specific goals.
  • IBM evolved its IoT message during 2017. Instead of emphasizing IoT-based business transformation, operational efficiency gets top billing. The company now encourages customers to “start small” and is partitioning all of its offerings; with SaaS, it is easy for customers to choose the modules they need. Pricing is designed to allow customers to “pay as they benefit”.

Be the first to comment

What do you think?

This site uses Akismet to reduce spam. Learn how your comment data is processed.