Internet of Things is on everyone’s lips. In 2020, approximately 24 billion things worldwide will be connected to each other with a market potential of 300 billion Euros. But what lies behind this hype and how can we use its potential? At this year’s START summit, Ralf Günthner and Mario Schmuziger from our Swisscom Industrial IoT team explained what Swisscom is doing in this trendy field.
Ralf Günthner, Head of industrial Internet of Things and Mario Schmuziger, Business Development industrial IoT, Swisscom @ START Summit 2017, Pitcure: Milos Radovic
IoT – how did it become such a hype?
There are 3 key drivers that made IoT such a fashionable thing at the moment. First, the technological development in the recent years including the accessible mobile networks worldwide and the enormous growth in computing power in combination with mature cloud technology led to a massive decrease of the price of sensors. Second, we experience a huge development in IT and software development skills that make building IoT applications possible. The third reason is pressure: Corporates all around the world are under pressure to bring new services to the market to attract new customers and keep their existing ones.
Why should we as Swisscom care about it?
When we started to focus on Industrial IoT, the most important question was how we could generate value for our customers. We came up with 3 main drivers: The new technology allows us to interact differently with our customers and get an easier, more intimate connection to them. It also allows us to make processes more efficient and reduce the time we need to interact with customers and partners. And last but not least, there is a great potential to create new business models with IoT. Especially in the industrial IoT there is a big unused potential – 90% of all machines are currently not connected, however, the data they produce could bring considerable added value for the end customer. We came up with the so called Triple A model: We start acquiring the data from the things and systems that create it and send this data to the cloud. What follows is analytics: we combine the information that the data contains with different information in order to create smart data. With the smart data, we create different IoT applications cases.
What are concrete Industrial IoT cases Swisscom has been working on during the past 2 years?
One of our cases is Walter Meier, a Swiss based company providing people with heating and air conditioning systems. Walter Meier has about 300 service technicians that visit their customers in total around 1000 times daily. The challenge they faced was that more and more heating systems that are currently running with gas and oil are being replaced by heat pumps. This will make their service revenue decline. The goal of our collaboration was to overcome this decline. Since January 2017, all of the heat pumps are ecquipped with IoT technology sensors that are extracting data from the heat pump and sending this data via mobile network to our cloud. This gives Walter Meier the possibility to monitor all of the heat pumps and to access every heat pump remotely from their office. Therewith, they are able to reduce their service cost, since now, every technician only needs to do his visits once instead of multiple times.
Another case is Stromer – the producer of the e-bikes that cost around 6000 to 7000 CHF. Because of the high price, they wanted to protect their e-bikes against theft. The first use case we came up with was that we installed a sim card in every bike frame so that Stromer can track every bike they sold worldwide. Once you know where the bike is going and you can track the distances you can easily come up with other business models based on that. That’s why our second business case was bike sharing, similar to Mobility, but for Stromer e-bikes. Stromer is tracking the bikers and charging them per kilometer that they went with rented Stromer bikes.
What are the most important learnings so far?
The most important learnings for us as a corporate, now that we’re running projects since 2 years, is that speed in this market is very high and that you need to start now to avoid being left behind by competitors. Also, you need to start small and use agile and iterative approaches. As we demonstrated with the Stromer case, one case can lead to another. It is essential to keep in mind that when working with IoT, it’s not all about the technology, you also need to change the mindset of your employees. Startups that are active in the field of IoT need to make sure they have an USP that differentiates them from other startups and competitors. And finally, students who are interested in working in IoT should choose companies that put digitization on top of their agenda.
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