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Monetizing the Internet of Things

By Lavanya Rathnam, TMCnet Contributing Writer

The Internet of Things (IoT) is the next big technology wave to sweep through not just IT departments, but also sectors like manufacturing, education, healthcare, energy, construction, and just about every other aspect of society. IoT is all-encompassing because it enables different devices to communicate with each other to improve the overall standard of living of the people. For this reason, the IoT market is projected to be around $1.9 trillion by the end of this decade, and many companies are preparing to have a share in this huge pie.

However, one of the critical success factors for IoT is its commercial viability. Companies may be able to come up with the best sensors and devices that can allow devices to communicate with each other, but if the product is not commercially viable, then the product cannot sustain by itself for a long time. This is why it is important for companies involved in IoT to keep the monetization aspect in mind while creating the product.

There are two key areas where monetization is possible. The first and the most important one is to control the configurations and the resultant usage of the device. This way of monetization is a two-pronged approach where companies control access to the source code, and also, the software-embedded hardware that comes with it. In other words, the company that creates a sensor licenses its products to other companies to use it within their products.

Another potential area is field upgrades, where customers can upgrade their software when they want, without having to send it to the company every time. Also, the availability of field upgrades will work cheaper for the customer as they do not have to purchase expensive hardware equipment every time. The company offering this service will have to verify the integrity of the software before allowing customers to download the upgrade.

The above monetizing areas can help companies to get the most money out of their IoT efforts.