In the future will we all be connected? There is no doubt about the rise of the Internet of Things (IoT): from manufacturing equipment to smart watches, as well as cars and domestic appliances, the number of interactions is growing continually… Where do French companies fit into this much coveted sector? Faced with the major resources implemented by GAFA to keep control of platforms, there are still a number of hands left to play.
IoT: a complex value chain
Media events like CES in Las Vegas portray the Internet of Things as a world of sensors dedicated to health and mobility, and everyday objects souped up with intelligent assistants like Google Home and Amazon Echo. A classic example of this phenomenon is Nokia’s takeover of French company Withings, a pioneer in the connected devices market.
However, the expression IoT covers a much broader universe: it illustrates the way in which technology now allows us to use data from billions of otherwise inert everyday objects, both in the world of manufacturing and in everyday life. It would therefore be unseemly to restrict ourselves to gadgets designed to count our steps or activate a switch remotely when the IoT opens up a virtually unlimited world of possibilities.
It is not enough simply to attach a few sensors and internet access to the first object you come across. First of all you need to think about the uses enabled by this layer of connectivity, as that is where the value will come from. The next thing is to look at how to capture it.
The world of the IoT consists of layers that determine choices of equipment and ways of implementing a connected object. The first level is that of communication, with the choice of networking technologies that will form the basis of the relationship between the object and its platform.
Capitalising on data and uses
Behind standards that are not well suited to the IoT such as Wi-Fi and Bluetooth, a number of standards are coming into play as industrial alliances are formed. An example? Home automation is still torn between Zigbee and Z-Wave, while other operators are capitalising on proprietary protocols.
On the next level up is the layer that will underpin interactions and the associated computer processing. It is here, at the software stage, that the greatest source of value is found. In B2C, we use all data relating to how the object is used. In B2B, we construct all usage scenarios, from supervision to predictive maintenance, as well as automation.
Already leaders in Cloud computing, the GAFA companies are well equipped to establish themselves at this level as they already have the necessary infrastructure. Thanks to their economies of scale, they are focusing on the construction of platforms intended for all companies wanting to enter the IoT market in one way or another. This advantageous position will not necessarily turn into a dominant one. In reality, it even offers real opportunities.
GAFA and BATX, the temptation of the platform
The platform logic developed by GAFA imposes a very generalist view of matters relating to the IoT, in which many industries demand a specific approach, either because the subject is too narrow to be addressed by a generic tool or because the sector imposes specific rules in terms of data handling. By regaining control of the software aspect, you also give yourself the ability to design tools and services that are truly ad hoc, corresponding to both the constraints of the IT system and business challenges.
It is even more necessary to think about this given that the sector is still evolving. Behind the GAFA companies already paving the way, competition is emerging from Asian giants. They can also be grouped together under an acronym: BATX, for Baidu, Alibaba, Tencent and Xiaomi. Even more aggressive than the US models, these four companies each illustrate in their own way how economies of scale and attaining critical mass very quickly, then make it possible to gain market share abroad.
Niche markets or the pan-European platform: numerous opportunities
These intermediaries do not constitute an impassable barrier. In addition to platforms, the rapidly growing IoT sector presents many opportunities that have already been identified by French and European operators.
A pioneer in low speed communication networks dedicated to M2M communications, French company Sigfox is historically based in Toulouse. In its tracks, a real IoT Valley has developed, consisting of several dozen specialist start-ups followed by industrial heavyweights like Airbus and SNCF. Together, all of these operators are working on implementing solutions and tools to respond to new user practices – both B2C and B2B – resulting from the emergence of the IoT.
Against this backdrop, the large number of platforms, tools and technologies should be seen as means of responding to usage issues or innovative industrial scenarios. What are the keys for not missing out? Encourage alliances in order to create platforms suited to the demands of a particular niche market, exploit as much as possible the wealth of what is on offer in terms of industry platforms, and, above all, think about the value in use before thinking about the characteristics of an object.
Samsung knows what it’s doing: for the last four years, it has been working on developing a platform dedicated to horizontal exploitation of data from connected devices. Named ARTIK, it is led by the South Korean group’s Innovation unit, headed by Frenchman Luc Julia. Today, he regularly recruits engineers – also French – for Samsung to support R&D.
His belief? He explains that the IoT will live up to its full promise when data from isolated objects is grouped together within the same digital place, so that algorithms can cross-check the data and extract useful information and use it to initiate actions.
In early 2017, French Parliament members Corinne Erhel and Laure de Raudière called in a parliamentary report for the emergence of a pan-European industrial services platform. Without going as far as repeating the experience of sovereign Cloud computing, by thinking in terms of standardisation and creating an environment able to attract talent, French and European operators will be able to establish themselves in this promising market.
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