Connected objects: the challenges of a revolution in progress

The scope of the application of connected objects is very broad, but the abundance of connected devices and the use of data raise a number of issues. What are they and how should they be responded to?

The nature of these difficulties is not new given their similarity to one that has been around for ten years and which led to Big Data solutions: a deluge of information of every kind, all mixed together, which must be processable. Yesterday, it was related to the interconnection of corporate networks and Internet services. Today, it is the interconnection of objects that presents a problem.

However, a technical solution will not be enough. Indeed, the data is not buried in communication networks and data centres, but is produced by users themselves, affecting them in the most profound ways: who they are, what they do, their personal lives, their health, their driving behaviour, who they see and where they go. Finding a trusted third party for making these B2C relationships work is thus essential, and the current movement towards centralisation around the routers of telecommunications operators does not necessarily add up. Shortening the processing chains without using an Internet network is technically possible, and our first experiences with a SigFox-type mesh network augur very well for the development of these non-Internet services.

And what about the business model?

The thinking is still in its infancy and meetings between the relevant stakeholders are increasing: initial discussions are taking place, from within the business associations and competitiveness centres, right through to the Ministry for the Economy. Relationships between academic and industrial players are being forged, which is very positive. Service operators are also participating, through the conversion of their IT solutions to these new demands.

The strong message from industry heavyweights goes like this: behind every object, there are services. Thus, the business model is moving towards reducing the cost of the connected object for the user, through to it being free. The services will finance the investment needed for the development of connected objects and their use, either through the commercialisation of these services or by the integration of the costs into the B2B or B2C business models that may evolve.

Thus, in the insurance sector, financing through the lowering of expenditures (decrease in claims and accidents, in the private as well as professional spheres) is a simplistic but potential example. This is combined with changes to the cost of insurance and raises important questions (for example, price variability in accordance with lifestyle) that will have to be quickly resolved.

The transformations that connected objects offer are only in their infancy. What are the prospects and challenges for the coming years?

The current model whereby the connected object is a gadget that a small number of affluent and already connected users get themselves for an immediate and individual service offers little value for French companies. In France as elsewhere, the operators in the market no longer position themselves as electronic equipment manufacturers, having made clear that they will develop their own services, starting with the area of the ‘quantified self’, which constitutes the first visible market for connected objects. By integrating sensor networks into it – those that are fitted throughout our cities, for example – we can grasp the extent of the imaginable services based on the same data.

We can envisage a new ecosystem featuring several stakeholders:

  • The one that prescribes the connected objects; the concept of “prescription” is a good fit for the health, insurance, social housing or public authorities model, where an authority may authorise, approve or encourage the use of connected objects;
  • The one that finances them;
  • The one that uses them on a daily basis;
  • The one that integrates and manages the data; Sopra has a role to play here;
  • And the one that uses the data.

Finally, for completeness, we must mention the case where the saturation in connected devices – be it perceived or real – becomes too large for the associated usages to persist. It is a risk that must be considered as early as possible.

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Julien Holtzer

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