Impressions from the Genius of Things Summit: A new IoT Crystallization Point
The conference was an impressive series of industry leaders’ speakers talking about their projects and partnerships, such as from SNCF, Bosch, Schaeffler, Wal-Mart, Airbus, Daimler, Visa, Foxxcon, Vaillant, Ricoh, Kone, Tesco, Harman, Panasonic, Bragi, Local Motors, Arrows and Indogogo. In most cases a board member or the CEO presented their successes. IBM claims to have 6,000 IoT projects under way (an increase of 50% over the last 6 months). Also the participants mainly represented the executive level. Clearly, it was a solid demonstration of the ongoing development and change in the industry.
It is well understood that IoT projects with a transformational character have to appeal to the lines of business. They are business-driven renovation projects at the end of which products will no longer be sold but services will be delivered by physical goods. One idea circles around the following: In the near future a consumer may walk into a store, grab an item (equipped with electronics and sensors) and leave the store without paying the device. The consumer may be allowed to use the item for free let’s say 100 or 1,000 times, and subsequently they pay for every single instance of usage. The device signals its usage to the vendor and a money exchange happens in the background. They key question is: How will secure data exchange and authentication happen? The answer to this is the also announced new intensive partnership with the biggest credit card company Visa. The two companies have developed a token service (Visa Token Service) that will allow for secure payment without involving a classic bank for the transaction. This will not only work for small electronic devices but also for cars (parking, maintenance, shoes, etc.) and many other household items. The Visa Token Service will replace the credit card number and security information on the credit card with a unique digital token representing an additional security layer. Now the question is whether this innovation has the potential to revolutionize the usage of goods and services.
IBM also made a big splash with the concept of the digital twin, a concept having already proven its value for highly sophisticated industrial goods. This concept is now being rolled out to the mass market, enabling new ways to interact with products, as a basis for new services and also new design principles: The services have to be integrated into the products right away.
In order to respect privacy issues, IBM also made a clear statement: The IoT offerings will be based on three core principles, one of them being the data will always be owned by the producer. This is a clear differentiator compared to other cloud computing providers. In IBM's view this clear position shall help to increase the acceptance of IoT services in the consumer space. The Visa Token Service may be a tool to support this core principle.
Alongside known official cooperations (e.g. with Siemens, Airbus and BMW), IBM also announced a series of further strategic partnerships, such as with ABB Bosch or Tech Mahindra. Many of the new companies joining the IoT party are working with IBM in its colocation space in the Watson IoT center in Munich, which is also an impressive demo center and pilot project lab. For sure, the $200 million invested for about 1,000 people working and inventing there will soon pay off. The industry has found a new crystallization point for the Internet of Things, aka "Industry 4.0" (or industrial IoT).
However, IBM missed the chance to extend its discussion of the ongoing engineering approach that will drive a continuously increasing customer experience with the products and services of its customers. A necessary ingredient is also the design process, for which IBM could have included its design studios as well. They are a worldwide – often overseen – leader in this area, too. That would have made the Genius of Things Summit complete. Customers might have missed that final link.
Bottom line: IBM has clearly left the IoT launch pad and is now in 'free flight' mode. The depth and breadth of its offerings are now impressively accompanied by success stories, new and far-reaching partnerships as well as its strategy and capability to address IoT offerings in a vertical industry context. The industry may have found its new crystallization point for collaborative Internet of Things competencies.