IoT Changes Business Model

Like the potential of the internet, the promise of the Internet of Things will take a while to materialize. To ask a huge multinational to transform their business model on-the-fly isn’t easy. Of course, startups pursuing opportunities in the Industrial Internet will accelerate this pace of change. But we’re talking about changing the way the biggest industries do business. Patience is a requirement.

via One of the Best Business Opportunities in the Next Decade.

Tomasz points out one critical element in the space for Internet of Things (IoT). It changes the way traditional business conduct their business. He gave a great example on how GE changes from “selling aircraft from a fixed cost with maintenance to selling hours of flight time”.

The same is happening in a data centre project that Intraix is doing now. They were charging a fixed rate for their clients based on the rack spaces the clients are using.

However some clients are using more efficient servers than others and a fixed fee would be unfair for those who are doing so. Plus using a more efficient server also help to reduce energy consumption for the data center.

Thus to encourage this behavior, data center are lowering the fixed fee while adding a variable fee based on the energy consumption that each particular server are using. To allow this, smart server rack are being set up and consumption data are push to private cloud for analysis.

IoT is not just about connected devices, it’s much more than that.