A certain segment of industry professionals has disdain for using the phrase “Internet of Things” to describe the latest network-connected technologies schemes. The problem, according to some experts, is that this latest IT “buzzword” is a little far-reaching in its scope and definition. “Thing” really doesn’t do justice to these advanced technologies that could solidify the channel’s value proposition for years to come.
In fact, CompTIA’s latest research on the Internet of Things (IoT) uncovered a number of new opportunities. After exploring and surveying the subject over the past couple of years, listening to the industry discussions and seeing the momentum continue to grow, we decided to dig deeper. Our goal was to gain a better understanding of the IoT ecosystem and see how it aligns with the channel’s existing lines of business.
First of all, we found there has never been as much anxiety over IoT as there was around the cloud, and the good vibes are trending upward. In fact, 39 percent of channel firms have a significantly more positive view of IoT than they did a year ago, and 36 percent have a slightly more positive view — more than three quarters of our industry segment!
The opinions of an additional 21 percent of respondents have not changed over the past 12 months. Those numbers include firms that were already optimistic about IoT to begin with.
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One reason for that positive outlook may be the increased income opportunities. The research shows a significant rise in IoT channel revenue this year: Twenty-three percent of respondents indicated they made money from these solutions within the past 12 months compared with only 8 percent of firms in 2015. Businesses with 50 or more employees are taking the lead, with 36 percent already generating IoT revenue, compared with 15 percent of midsize (20-49 employees) and small organizations (fewer than 20 employees).
Before making a mark with connected technologies, providers need to identify the options that best fit their clients’ specific business needs. The IoT ecosystem is complex, spanning hardware, software, rules and services. Few channel offerings will truly encompass all areas, though a few broader examples exist. Integration skills are a key value-add, and consultation abilities in this area may command a premium rate.
Many solution providers focus their IoT expertise in one or two areas. Initiatives of this size and scope are rarely ready to use right out of the box; organizations often leverage a variety of suppliers and partners to customize these systems to their meet specific business needs. Channel firms can extend their current capabilities with various elements of IoT. If a VAR’s focus is on hardware sales or break-fix service, expansion into internet-connected technologies is a natural extension.
MSPs and solution providers will find plenty of opportunity for selling and supporting cloud systems, customizing software or building new apps for visibility and control of IoT-related devices. The services sector will continue to thrive, with analytics providing new insights from new data and managed services keeping the whole architecture running.
And, of course, there’s security. With all the data collected by IoT technologies, protecting that information will become increasingly important. Providers with security expertise, especially those who can help develop rules and regulations related to these solutions, can expect to see their demand rise significantly in the next few years.
While neither the name nor early examples have inspired confidence among channel firms, IoT opportunities are finally coming to fruition. We’re moving beyond zombie refrigerators today, seeing true business applications and support services on the rise. The potential benefits to be reaped by connecting more complex devices and sensors to the Internet are truly remarkable, and channel firms have a real opportunity to own this segment of IT. The question comes down to, what will each provider, vendor and distributor do to secure their place in this exciting new world? Stay tuned …
**Editor’s Note: The Internet of Things is the biggest managed services opportunity that no one knows how to exploit. The channel ecosystem is perfectly suited to own this market. In this free Report by a noted security expert, we run down the three must-have pillars of a profitable IoT program and look at the security considerations intrinsic to each element.**
Seth Robinson is senior director of technology analysis for CompTIA. In this role, Seth analyzes technology trends in the IT industry and provides insight into trend drivers and future direction. Seth has led research studies on cloud computing, mobility, Big Data and IT security, among other areas. Follow him at @sethdrobinson.