Seventy percent of service providers responding to an Ericsson survey have no well-defined strategy for the IoT. The survey about service provider IoT strategies drew on input from 20 telecom service providers around the world and was designed to create a framework that captures service providers’ roles and sub-roles in the IoT value chain.

Service Provider IoT Strategies

The structure that Ericsson developed has four elements: Network provider, connectivity provider, service enabler and service creator.

“The report confirms the importance of IoT to the current and future business of leading service providers, no matter where they operate in the world,” Jeff Travers, Ericsson’s Head of IoT, said in a press release. “Regarding IoT as a new type of business, service providers are investing in new technologies and establishing new business models for revenue sharing and increased use of indirect channels. They are also creating new delivery models for as-a-service and online services and driving innovation with partners and customers.”

The study, entitled “Exploring IoT Strategies: Insights on IoT value chain positioning from leading telecom service providers,” also identified sub roles that can drive more value. They are “supply,” “integrate,” “operate” and “transform.”

The study found that a key advantage of encouraging sub-role diversification is that it enables the building of new positions within the main roles. The firms used in the research tend to run dedicated startup units that are measured by a variety of key performance indicators. These include IoT revenue market share, the number of IoT-connected devices and app downloads.

The most commonly targeted areas for the IoT among the companies are fleets and logistics, connected cars, smart cities and industrial automation. The study found that telecommunications service providers are establishing new revenue sharing business models and increasing their use of indirect channels. They are exploring new delivery models for as-a-service and online services. They increasingly are driving innovation in partnership with customers and partners. They also are investing in new technology.