IoT Insider Podcast | Episode 8: How to make money with IoT

Dan Cunliffe
Hi everybody, my name is Dan Cunliffe Managing Director of Pangea. And thank you very much for joining us for our October podcast. I’m delighted to be joined by my Sales Director, Bernie McPhillips. Bernie, how are you doing?

Bernie McPhillips
Really good. Thanks, Dan, how are you today?

Dan Cunliffe
Not bad, thank you not bad, we’re recording across two continents as usual. And being able to use the power of connectivity all around the world from our different locations. But just talking about different locations, we were very fortunate to be asked to be part of the Channel Live IoT panel a couple of weeks back now. And I felt that it would be a good idea for us maybe to go through some of the questions we particularly had on the panel, basically focusing on, you know, should someone start building their own IoT ecosystem? And how soon should they do that to take advantage of the opportunity? And I thought maybe we’ll just go through some of those questions, buddy, and maybe give our partners a bit of insights to to what hopefully will help them grow their business to the end of this year and into next year as well.

Bernie McPhillips
Yeah, sounds great. Let’s do it.

Dan Cunliffe
Cool. So one of the questions was, is adding IoT to your portfolio any different from taking on another product? What are the major considerations for partners? Do you wanna have a crack at that first? Maybe, maybe tell us what you think?

Bernie McPhillips
Yeah, sure, no problem at all. In terms of reviewing the opportunities available with IoT, I don’t necessarily see it as any different from from taking on other products. Yeah. A lot of our partners are telecoms providers, Internet service providers, technology, led companies, and there’s been many evolutions of all of those particular sectors over many decades, think about the birth of smartphones, mobile, email, applications, Hosted Voice, etc. And when reviewing those new opportunities as they come around, I speak an awful lot about kind of just three main considerations when reviewing new products. And this won’t be any, any secret to you Dan probably repetitive for you. The first thing is, is the opportunity real? So, you know, what are the facts? What are the figures? And what is the market all about initially. So, you know, most people who’ve listened, to these podcasts will have a view of what IoT is, but effectively, you know, we’re connecting sensors, we’re connecting things. And those those things and those sensors can be in cars, buildings, machines, effectively enable them to communicate their status, things about the environment, that we have to control those things remotely. And that just makes so many things possible. Just the asset tracking, condition monitoring, preventive maintenance, and even things that now appear maybe less futuristic than they used to like autonomous cars, driverless vehicles, and all these this technology is constantly broad, constantly growing. So is it real? It absolutely is. I don’t think any any analyst in the world is kind of denying the fact that the Internet of Things and everything related to it is a huge growth area. And actually, more recently, I will tell you, there’s even been a surge in that that predicted growth and indeed in adoption. So one of our strategic partners, one of our suppliers Vodafone have just recently released their IoT barometer for 2019. And they’re kind of they’re seeing exactly the same thing, more than a third of companies and are using IoT. That’s up from 29% last year. I think the benefits that are coming out of it, are just growing more and more quickly. So I think we’ve all read about the billions of devices, trillions of dollars. But the great news is, as we’re moving across through this timeline, it genuinely is becoming real. The second one of those pillars says is the opportunity real? I think absolutely. Can I win? So I think you absolutely can but it has to be a thing with a partner led approach. The IoT market is extremely complex. It’s extremely vast, and I don’t think any one providers gonna try and do all on their own. So I think a lot of this is about a lot of the success in IoT is about collaboration. And being part of what at the centre of a great partner ecosystem? And then the third bit is when can I make money? And again, I don’t think there’s any doubt about that in terms of how you can make money from IoT. There’s huge amounts of revenues available, good solid margins, and very different contracts, how people are prepared to contract or organisations are prepared to contract. Yeah, as you will know Dan, pretty sure you have been involved in it back in the day, but our longest contracts 15 years. Yeah. That’s rather unheard of in telecoms. You often don’t have to give away hardware at the very beginning of an IoT project as well. Yeah, so you’re, not necessarily even cashflow negative, right at the very start. So there’s a lot of reasons to get involved in IoT.

Dan Cunliffe
Yeah, I think I think you’ve hit the nail on the head there, you know, your three sort of questions have always been really relevant for me, even from early days before we got into this business. But you’re right, you know, is it real? Can we win? And can we make money? I think for the partners, it’s important that there is an opportunity to grow business from the; ‘Can we make money?’ part otherwise, you know, why why invest? or Why? Or why kind of get into that say, part of the major consideration for partners is really, to be sure not to try to do everything on your own. I think that’s a that’s another one for me really be open to working with someone who can probably provide you with more than just one part of an of an IoT ecosystem possibly give you as many paths as possible. So you can really attract and I suppose attack existing business within your within your channel. No, excellent. I mean, so that was excellent coverage of the first question, the second one that we maybe want to dive a bit deeper into, and I’ll have a little go this and we can we can go from there is you know, where do you see the most successful channel deployments? Which markets or types of solution? I think we’re always asked like, you know, where should we go? Where should we focus for our partners. And I’ll probably take it back to when we started Pangea. Just over four years ago, there was a lot of push, if you want, like, we were really trying to try to get people to buy into the Pangea IoT ecosystem, you know, where we had our connectivity portfolio, our devices portfolio and the analytics side. And slowly but surely started to evolve that into more into more of the solutions, where you tend to find some of the big wins, I guess, is, you know, traditionally, telematics has always been a very strong player. And that could be vehicles, that could be connected drains, it could be anywhere where you’ve basically got a small amount of data that needs to move, and help you understand that thing you’re connecting to the internet. But actually, what I’m finding and I think some of our partners are as well is, it really comes into some of their existing business in quite a few places, construction seems to have been a very strong play where the just just the the actual deployment of services, and I suppose connectivity is very difficult, because to reach certain construction sites, you know, via traditional methods, wired connectivity is very hard. So using strong 4G services, Multi-network 4G services, with static IP becomes a very strong market, and also a pretty decent, lucrative market as well. I’d say probably one of the more innovative areas where we’re seeing traction is also on what I like to call kind of value added connectivity or value added application around IoT where we build things like Wide Area Networks, for some of our enterprise partners. But equally look at things like backup solutions on 4G, those things seem to be gaining a lot of traction with our telecoms partners. Bernie, what do you reckon with our solution partners, obviously, you deal with a couple of them, maybe you want to talk about some of them and kind of where their big wins are coming?

Bernie McPhillips
Yeah, for sure. I think you just you’ve very eloquently touched on, certainly some of the key verticals there Dan. I wouldn’t disagree with any of that. I do tend to just loosely caveat any conversation around, you know, which sectors should I focus on? We kind of don’t necessarily see a need to reinvent your business. If you’re an existing telecoms reseller, an internet service provider, you’ve got a very successful business already. Look at where you’ve already been successful. That is maybe down to geographical area. So within your local area, if you if you’re heavily focused geographically, if you you know, if you’re in a very industrial area, you’re probably sold to a lot more kind of maybe construction, manufacturing, logistics types, companies, as opposed to more urban based resellers that are probably maybe selling into the legal and finance sector, for example. There’s no need to reinvent your business in order to adopt an IoT strategy. Because undoubtedly, wherever you’ve been successful in the past, wherever you sold your more traditional product into, there are IoT opportunities in those sectors. So you don’t need to tear all of that up and everybody scurry off and try and focus on your construction, telematics, etc. and the things that you’ve just gone through, look at where you’ve been successful in the past and, and do more of what you’ve already been good at.

Dan Cunliffe
Yeah. Yeah, exactly. I mean, I always would say to the partners, when we started even today, it’s, it’s, it’s, it’s quite a nice thing to almost go into the customer. And baby, pick your top 20 partners, and really focus on what specific applications or devices or even just, you know, sort of value added connectivity, you can bring into that existing piece and you’re absolutely right, why change your business, the IoT actually helps fit to existing services very easily. And that’s one of the successes we’ve had, but also our partner channels had is that we work really closely with a partner to identify where you can make existing revenues grow, because your existing customers are already there. So no, I totally agree with you on that, in terms of that channel approach.

Bernie McPhillips
We’ve got over 200 partners now, within our ecosystem, and I honestly couldn’t even name one of which have had to kind of completely realign themselves in terms of the verticals that they that they sell into as a result of adopting an IoT strategy. There has been opportunities and success to be had and the places that they focus previously.

Dan Cunliffe
Yeah, totally, totally agree with you. Cool. I mean, you know, we’ve covered off kind of what sort of, I guess, verticals or solutions I was looking at. The last question was, was focused around, how will changes in the IoT landscape impact partners over the next one to two years? I think, you know, it’s only going to really grow in terms of where it’s going. You’ve got many, many factors that are going to start to increase the way that the Internet of Things gets used. But equally how simple things like autonomy amongst machines, or more information that helps to drive better outcomes, starts to develop. One such specific that is actually going to be quite exciting. And we’ve done a lot of work in in the world of 5G is actually the sort of triangle of 5G that comes in comes into play for some of you who’ve heard Bernie talk about it heard myself maybe talk about it even heard the good old Dr. Arslan Usman in our team talk about it. There’s kind of three specifics around 5G that are coming to the fore as 5G becomes more and more important, those being Massive Mobile, which which essentially means many, many connections, almost a million per square kilometre, Ultra Reliability and Low Latency that’s really about exactly as it says there being very, very accurate, low latency, highly reliable connectivity. And the third part of that triangle is the Enhanced Mobile Broadband, which is sort of what we’re experiencing at the moment, in terms of, you know, just faster connectivity. But I think the stuff that’s really exciting for us Bernie is the ultra reliability and the massive mobile for things like self drive cars, etc.

Bernie McPhillips
Yeah, yeah, absolutely. I think that the massive mobile gives you a large you have connection density. So if you consider at the moment, probably a frustration that anybody listens to the podcast will will have enjoyed at some point, if you go to a concert or a sporting event where there’s a large number of people in a small space, so you have 10s of 1000s of people in a stadium, for example, you may well have a really strong signal on your mobile device, when you look at it before five bars, that’s great. But as soon as you try and do something, to connect to the internet posts on social media, you don’t seem to break out. And that’s just all down to connection density, there are simply too many people trying to connect to the same cell site, and you’re right you know 5G kind of really helps to overcome all of that, and allows that million plus connections within a single square kilometre, which simply has to happen if you think of where IoT is going. And especially with things like autonomous vehicles, where connectivity isn’t just important, it’s simply critical, you can’t have a really busy part of town with a lot of cars. And all of a sudden, we can’t connect all of these cars at once, and they just kind of literally just gonna start crashing into each other. So you need to have that connection density, and then you have the Ultra Reliable Low Latency is then just a completely you know, complete game changer when it comes to healthcare, for example, because you need to absolutely guarantee as close to real time because you don’t want less than a millisecond latency, as close to real time as you’re ever really going to get when you’re transferring data across what potentially could be 1000s of miles to allow specialists to oversee or even maybe conduct surgery remotely with the use of robotic arms and that kind of thing, but at the very least be able to oversee and instruct surgery remotely, that information has to be passed from A to B in as close to real time as you can possibly get. Otherwise, that specialist isn’t able to respond to what is happening to that patient or the vital statistics anywhere near as quickly as as would need would need to be. Yeah. Yes, the 5G piece is huge. I think even on a more basic level Dan if you think of the evolution in connectivity up to this point in time. You have GPRS 2G, 3G, 4G, as as speeds have got quicker, the applications and what we’re trying to do over that an activity becomes increasingly more data hungry. So as applications continue to develop, and people find new and innovative things to pass over the 5G network, people use more and more data. Yeah, so think, think of real significance and a great opportunity for our resellers. Just that more basic level the importance of managed connectivity versus unmanaged. Yeah, as things as devices, as applications have the need to use more and more and more data, there is a potential for exposure in terms of massive amounts of data being used, and are you on the right tariff, are your devices doing what they’re meant to be doing. Whereas if you have managed connectivity, you’ve got real time alerts and notifications, real time visibility via a portal etc. So you can truly manage the connectivity that’ll drive your applications. Fantastic, and slightly more basic opportunity that’s available to our channel.

Dan Cunliffe
Yeah, I was gonna, I was gonna add one last thing in terms of opportunity for kind of the future, the next two years is what the Ultra Reliable Low Latency element to 5G, which will be available within the next two years, it’s still at least a year away. But when that starts to become really useful, there is actually going to be the way I see it coming, there is going to be an almost paid for or premium to have a specific slice of the 5G spectrum for your clients. So for example, if you are already servicing people, like the NHS, or certain healthcare or even the police, or, you know, many of our partners already provide services in those markets, you can actually upsell with a far more reliable, almost a sort of service level guarantee, which you could never do before on a mobile network, which you can do in the future. And I think that’s going to drive a lot of higher value services, as well as some really cool innovation. So yeah, we got lots to look forward to in the next 12 to 24 months.

Bernie McPhillips
And partners are quite used to those types of services where instead of paying for, you know, having fibre installed into your building, you have something more dedicated for you. And it guarantees a certain level of bandwidth doesn’t it so I think that’s something that our channel would be very familiar with.

Dan Cunliffe
I think it’s safe to say that, you know, on the channel debate, it was a lot of different angles, we had people from definitely more the device world, we had guys from the sensor world, application world on the on the panel. And I think the overall piece is that, you know, the IoT is here, it’s it’s coming even more, we’ve got different levels of estimates of growth. But what’s important is that there is growth, and it’s quite clear from our business and our partner channel that these things are exciting. So if this is your first time listening to us, welcome. But equally, if you find what we said quite interesting, please do get in touch via the various channels. This will probably be available either, you know, LinkedIn, our website, www.pangea-group.net and various places where you can find us on Twitter as well @Pangeaconnected. Bernie we’ll probably close up over there. please head over to our blog for the IoT tech guides, sector insights or if you want just give us a call the numbers on the website as well. I think lots of things to come in this market and usually exciting time for us.

Bernie McPhillips
Thanks for having me. I’ve really enjoyed it and I look forward to hearing from all of our resellers and partners who’ve got any questions about what we’ve spoken about.

Dan Cunliffe
Thanks, everybody. Have a good one.