14 December 2022
5 IoT Predictions for 2023 and Beyond
IoT Leaders with Nick Earle, CEO of Eseye and Larry Socher, SVP Strategy & Solutions of Eseye
14 December 2022
IoT Leaders with Nick Earle, CEO of Eseye and Larry Socher, SVP Strategy & Solutions of Eseye
The theme of 2023 is change.
The acceleration of disruptive technological and IoT trends is clear. Fragmentation is the order of the day. But at the same time, a paradoxical collision is taking place. Hyperscalers are upending decades-old paradigms about how technology and its uses evolve.
Eseye SVP Strategy and Alliances Larry Socher joins the podcast to offer insight into five key trends reshaping the IoT landscape.
Join us as we discuss:
Tune in to hear how technology is breaking the old apart and what’s next.
Join us on the IoT Leaders Podcast and share your stories about IoT, digital transformation and innovation with host, Nick Earle.Contact us
You are listening to IoT Leaders, a podcast from Eseye that shares real IoT stories from the field about digital transformation, swings and misses, lessons learned, and innovation strategies that work. In each episode, you’ll hear our conversations with top digitization leaders on how IoT is changing the world for the better. Let IoT Leaders be your guide to IoT digital transformation and innovation. Let’s get into the show.
Hello, this is Nick, and welcome to an unusual edition of the IoT Leaders podcast because in this episode I’m actually going to interview somebody from Eseye. And the reason of doing that is that we were luckily enough to be able to recruit somebody called Larry Socher. He’s fairly well known in the industries based in the US on the East Coast, and he was 26 years at Accenture and ran some very large global functions for the company. And actually, as you’ll hear in the podcast, the reason he is working for us now is a couple of reasons. One is I knew Larry when he was at Accenture, but secondly, when he was leaving Accenture and wondering what to do, he was listening to podcasts and he heard the IoT Leaders podcast and says, “I want to join.” So we’d never thought that would happen when we decided to do this series, but that’s one of the reasons he joined.
More importantly, he’s a big visionary in the industry and has been really instrumental in taking our annual predictions report to the next level. This is the fourth year that we’ve done it, and he really, as you’ll hear in a minute, takes it to the next level in terms of a lot of the background around the change in the industry and why these five predictions that we go through, we really believe in 2023 will all come to our head, and what it means for people doing IoT projects, and indeed for the players in the industry. So I would call it a meaty episode. Its action packed, and I hope as always that you’re going to enjoy it. So with that, we’ll hand over now to the podcast with Larry Socher, who is the SVP of Strategy & Alliances here at Eseye. So, Larry, welcome to the IoT Leaders podcast.
Great to be here, Nick. Been looking forward to this
You have in more ways than one because for our listeners or indeed viewers if you’re watching this on YouTube, we’ve done somewhere around 25 IoT Leaders podcasts. But actually this is an unusual one for two reasons. One is the first one that we’ve done with a member of Eseye’s management team on it, so it’s Larry and I. And secondly, Larry, you actually joined Eseye because of the IoT Leaders podcast, didn’t you?
That’s right. I actually joined back of January of this year to drive all of our strategy and alliances, and interesting story about how I got here. I spent the last 26 years at Accenture where the previous eight of those, I ran all of Accenture’s offerings for global cloud and infrastructure. So everything around hybrid cloud, workplace, service management, and network. Prior to that, I’d actually run our enterprise business for a couple years and during that time we had a very big go-to market with Cisco where Nick was actually running services at Cisco at the time. And I got to know Nick, he was a big part of our executive sponsors. So we had known each other for quite some time. And then previous to that, I was lead architect and ran Accenture’s service rider network practice for 12 years. But what’s interesting when I left Accenture back in September of 2021, I was doing some advisory stuff for a bunch of different firms, a computer vision firm and a few others, and starting look to what was the next thing I wanted to do in my chapter.
And I was really looking between IoT and networking, kind of my back to my roots, and came across, I was listening to a bunch of podcasts out there and they came across the leaders in IoT podcasts. I’m like, “Wow, that’s Nick.” It’s been a while. I knew you’d done the work with the Rails and with Rob Lloyd, but hadn’t figured out where you had landed. So I started listening to podcast, went into the website and was looking around, and one of you with the BDRs reached out and said, “Hey, see you’re interested in the site.” Sent an email back, copied Nick on it, and 10, 15 minutes later got a call and…
And you’re at. Well, that saved the recruitment fee, I tell you.
So what we’re going to talk about this time is just to give some context for everyone is each year for the last four we’ve done a predictions report. Some of you will be very familiar with it, maybe some not so much. And we basically found that a lot of people were saying to us, well, you’re an IoT all the time, 24/7, day in, day out, where is this all going because it seems to be changing, and the landscape. Can you just take a step back, zoom out, and give us some idea of where it’s going? So we started doing that and we produced the first one, as I said four years ago, and I think we were taken by surprise, it was our number one downloaded piece of collateral. So we’ve repeated it each year, and each year it’s not only our number one downloaded piece collateral as a company, but it attracts new people to the site, which as you said, attracted you.
But actually now the press pick it up and I think it gets syndicated, so to speak, or republished whatever the word is, into a few hundred publications around the world. So anyway, it’s got a life of its own. And so here we are, the 2023 predictions. It’s already available on our website, IoT predictions report. But what we’re going to do in this podcast is we’re going to go through the five predictions, and Larry, as he said, now runs our strategy for us as well as our alliances. And so Larry and I were both heavily involved in the predictions report. So this time we’re going to turn the tables, I’m going to ask you the questions, Larry, and you are going to explain why we think like that. Actually you’re speaking on my behalf, got to make sure we get it right. So there’s five. So let’s dive straight in. And the first prediction is the MNO, the Mobile Network Operator proprietary lock in finally cracks in 2023 with increased choice and the hyperscale threat. So what’s that all about?
Well, I think this has been a trend that’s been happening for years. So if you take a look at the Mobile Network Operators, I have obviously dominated connectivity in the cellular world that that’s been the predominance of IoT. And it started breaking down with the evolution of the SIM. So when they used to have a physical SIM that they plugged in the device that was provided by the operator, they had a very good strangle hold on that. Over time the SIM has evolved and we’ve started to get new technology. So eSIM, so embedded SIM technology, it’s now evolving into iSIM where it’s integrated the chip. So I think that’s been laying on the foundation. There’s also been a number of different trends like the ability to do remote SIM provisioning where you could actually change the different operator profiles, but the lock-in that the SIM had provided to the service providers has been chipping away for some time.
Now, the service ride has still predominantly maintained control of it, but at least the building blocks had started to erode at least the barrier of entry as it started erode to make it easier to make those changes. Now enter the hyperscalers, so that’s your Amazon, your Microsoft’s, your Googles. Obviously they’ve done a tremendous job shifting the enterprise out of the data center, taking on compute and all the services and building that. But they started to realize that the future of compute couldn’t just be in these data centers in the cloud. If you take a look at, there’s a number of forces out there that is actually pushing compute to the Edge, and Gartner’s got a phenomenal quote that by 2025, 75% of all data will not only be produced or processed outside the cloud.
And the reason for that is actually pretty simple. If you’re familiar with Moore’s law, Moore’s law used to be for decades it was every 18 months price performance and compute doubled. But it took two decades, it finally slowed to 24, but basically compute processing power continues to accelerate. Now, and that means just a proliferation of data, it’s going to keeps exploding. It can go into lower and lower cost devices to mobile phones, to sensors, et cetera. But if you look at the networks that are needed to carry that data from the devices which are increasingly smaller and more distributed in the internet of things back into cloud, the networks will never keep pace. So if you think about our upgrades, if you think about going from LTE 4G to 5G, which is all the hype right now, that was a 10 or 12-year cycle. So even with Moore’s law slowing down from 18 to 24 months, the networks will still never keep pace.
So the natural conclusion of that is processing needs to be on the Edge. So you’re going to need to actually do the compute and processing out there. And as a result the hyperscalers realized, “Hey, we can’t just sit back in the cloud, and in the data center we’ve got to push to the Edge.” And if you think about it, Microsoft was the first to see that if you… Azure stack, I think, was as early as 2008 where they started to push out and probably initially targeted the data center, but they expanded that to Azure Stack Edge, their IoT plugin play gateways. They’ve brought a bunch of solutions out there. Similarly, Amazon with green grass, with outposts have been pushing out. So I think they’ve all woken up to that with, “Hey, if 75% of the computes going to be out there, we need to move there.” And I think they’re moving out has started to put a bit of a disruption in the service provider.
Right. So probably connecting those Threads. You talked about the technology trend, which as you say we’ve talked about that a lot, but the SIM is no longer locked to the technical-
So that’s a technical thing, but it’s massively significant because it’s also a business change because it means that the MNO cannot abuse the phrase before control the game and pick what the agreements. What you’re adding to it here is it’s not just that, it’s not just the evolution of the eSIM and the eUICC standard, the undoing of the proprietary lock that’s been in place for over 40 years. It’s also the fact that the hyperscalers, they always follow the data. I mean they follow the money, but they basically follow the data from the data center cloud. The cloud is no longer the Edge that is a way of saying, they’re saying the new Edge is 75% of the database process generated process at the Edge, which means the applications will be Edge resident.
So we think about IoT in terms of a coffee, we’ve talked about a lot on this podcast, a coffee machine last week’s episode with Bioform is it’s a healthcare device, but Edge aggregation is also IoT. It’s where IT meets OT and the operations technology and the Edge devices are IoT in that they’re processing applications they have, and they also have to back all the data often to MNOs, but MNOs who don’t have a lock on the device anymore. So now you’ve got a whole new category of devices. You’ve got MNOs without a lock and there’s choice, and then you’ve got the hyperscalers who are going to follow the money and they’re going to go next to the Edge and they are truly global and have all the money. So if these three forces are colliding…
Well, you hit one at the end. The truly global, if you think about, although you’ve got some big operators around there, typically they’re regional companies, they operate in certain geographies and that’s a huge advantage the hyperscalers have, they’re truly global entities. So as they push out, and the enterprises are sitting out there saying, “Hey, these enterprises want to deploy a solution globally, they don’t want to have to deal with 20 different operators.” So they can deal with one hyperscaler and then find someone in the middle to put that connectivity together, it becomes much more attractive than trying to stitch it together themselves.
I think the hyperscalers, they’ve already done a great job with the cloud now as they start to push to the Edge, can really start to disrupt the market. And what’s interesting is they’re starting to… They seeing the need for the networking, right? Because their networking was usually into the data center. They’re already pushing out there. So you look at Microsoft’s being buying Meta switch firm networks, network solutions, Amazon’s launched a private 5G, so they’ve understood that networking plays an integral role. You’ve obviously got to connect the Edge and are certainly aggressively getting there. So it becomes very disruptive to the MNOs.
So all change, which is a theme of the 2023 report is that if I had to sum it up, you ain’t seen nothing in the end. We’ve been talking about disruption, but 2023 is where each of the five in themselves as disruptive trends accelerate and they collide. And so let’s start the second one because you mentioned private networks, and the second prediction is that interoperability between public and private networks becomes a priority. So maybe just in case there’s anybody out there who doesn’t know what a private network and maybe just start off with people say what’s a private network? Just explain what it is, and then why does interoperability between public and private become a priority in 2023?
Well, if you think about right now all the cellular networks are public networks. It’s done by Vodafone, done by AT&T or Verizon. So we’ve got these big massive public networks that we use that are shared entities. What’s happening is there’s a new set of technology that allows us to now build very specific private networks and it’s enabled by new shared frequencies, what called shared spectrum models. So the citizens broadband radio services in the United States is a great example where they freed up all the shipboard frequencies and have come up with a scheme to make those available. So people can build their own networks, and the reason they would want to build their own networks is they may not be being adequately served by public network or they want to segment the traffic.
Great example of that be manufacturing environment where I’m controlling all these machines. If my production line goes down, it’s a serious business impact, I want more control, I want to be able to finally engineer that network. So you now have this emergence or private networks, and I think this is all happening at the same time that 5G is coming out, which I think is important. So let’s step back a second and just quickly talk for 5G and then I’ll shift back to private.
So what we think, there’s a lot of hype around 5G where we see the real promise of 5G is around something that they call ultra reliable, low latency communications. So how do I get very deterministic communications and very low latency communications? And there’s certain applications that are enabled by that. So a couple good examples. An autonomous truck, if I can take the person out of a truck, for example, out of mine, for safety reasons, I can go down a much steeper grade, which means I can get with half the blasting, I can get the same yield out of the mine, incredible business case, but I need reliable low latency communications to enable that truck.
I mean the factory automation example I gave you. Computer vision, predictive maintenance, being able to do AI to determine, “Hey, this tire’s going to go out on a backhoe that may be a $200,000 tire.” So there’s all these new exciting applications enabled by ultra reliable low latency, but in many cases they need to be in a private network. So I can control that. So between the emergence of these private networks, the existing public networks, what we’re finding is if you take those use cases, in many cases you may have mobile, like they take that truck in to mine. When that truck is on a private network, which probably LTE right now, but eventually 5G, it’s driving around the mine. When it goes to leave the mine with the ore in it and goes onto the public highways, it still needs connectivity. You want to be able to track that truck, make sure there may be valuable commodities in it.
So I want to be able to track it where it is, I now need to go off that private network that I’ve built in the mine and onto the public network. So get into the, if I’m in Arizona, at Freeport McMahon. I want to go into AT&T, for example, over the highways, to deposit something in the port. So I want to be able to roam from that private network onto the public network. The converse to that is I may have a freight delivery truck that’s driving on the highways, that’s on the public networks, enters a warehouse and distribution center where it now wants to be roam onto the private network, so that it can communicate when it’s lost connectivity outside world. So we’re seeing a lot more of those case studies where you can roam to and from private networks.
I was just thinking visually as you said that, and maybe we could have used these graphics in the report. I was struck when you were saying it about a common factor between these first two, and maybe we’ll find it in the next three. But when you think about on the first one we talked about applications, they were in the mainframe, then it came mainframe mini, then mainframe mini, and then pc, and then pc, you got the mobile phone and then the internet. And it’s almost like we’ve got the universe behind our heads, these graphics for this, so that you can see. It’s almost like the Big Bang Theory. The Edge of the universe is expanding outwards at accelerating speed.
And then this one that you just talked about there, you talked about the interoperability and 5G between public networks and private networks. And there you’ve got the movement from, I use one MNO for all of my IoT and then long comes eUICC and eSIM, and now I can use any one of 800 MNOs because we’ve broken the link, and so now I have all this choice and then it’s like, “Well, hold on a second. No, no, no, my choice got bigger again, the Edge of the universe expanded again.” Because now there’s all these private networks and anyone can buy spectrum. You talked about buying spectrum, anyone can buy spectrum and there’s lots as a business, universities can buy spectrum, mines can buy spectrums. The public operators are now creating private offerings.
So you get, again, this world that we’ve had, which was arguably difficult enough for 30 or 40 years, suddenly in these first two what we considered was the box around the problem, the Edge of that box just blew away, and suddenly we’re having to go to a brand-new Edge. Suddenly we’re having to go to agnostic MNO choice and interoperability with private networks, and get quality of service enabled by different levels of resources applied to different functions, different rules overlaid on top of public and private. I mean, it’s another example where everything is just fragmenting and rushing outwards.
I mean that’s a great way of describing it, and it’s hard because not only you have to do the integration. So how do I make sure that the authentication that’s happening in the enterprise network, which is maybe governed by a set of tools like at Cisco, you had your ice product, Aruba Clear Pass active directory, now needs to be integrated with the co operators who have their home subscriber service, typical mobile ways of authenticating and all that needs to be integrated but then managed seamlessly.
And when you add quality of service that’s needed, so you think about what you’re LCC, there’s a term that everyone’s talking about network slicing-
Yeah, and that’s really quality of service in that private network. I mean very focused on, it’s a big advantage of 5G to do fine grain slicing, and it’s slicing performance reasons. How do I get lower latency, et cetera. There’s also a big part of security, if you hear the zero trust security, the big part of how do I segment something end to end and make sure that I can’t get bridge. So just the management of that alone is just incredibly-
I was thinking of the management of the app. I remember, we knew each other in the Cisco days, as you said full disclosure, but the managing applications that were hybrid that were both some applications behind the firewall and somewhere in the cloud, and having one set of management tools that would’ve applied policy to both. Now we’ve got applications behind the firewall, we’ve got applications in the cloud and we’ve got applications at the Edge, but the Edge, it’s not a direct cable to the Edge because the Edge could go through different MNOs depending on how the SIM decides to switch. So you’ve now got different paths to the Edge. And so the ability to apply those quality of service or network slicing policies to those 75% of applications that are going to be at the Edge is a very difficult thing because you are then going through different intermediaries, mobile networks, both public and private. Of course, I could say all of which means that you need a platform, an IoT platform, but more here to talk about Eseye.
Well, I mean what’s interesting is its part, a lot of the reason I came to Eseye was actually I looked at that problem. It’s one of probably the most complicated selection management and optimization problems I’ve seen. How do you select, manage and optimize your connectivity and control that path? And I do think it’s an exciting problem. I think there’s a lot of heavy lifting to solve it, but it’s certainly fun and it’s a big reason I came to Eseye is I actually think we’re capable of actually addressing that problem and mitigating it a bit at least.
Well, I’m going to raise the stake’s prediction number three. Have you wrapped your head around one and two thinking, oh my word, I have to learn all about this. Then it actually goes off laterally into another area because prediction number three is the ascendants of network agnostic and multi-RAT, so multi Radio Access Type. So let’s just talk a little bit about multi-RAT, and how many RATs are there. That sounds like a nature show. How many RATs are there, and what do we mean by the ascendance of network agnostic and multi-RAT?
Let me actually start with the agnostic. So enterprises really don’t care what network technology, what operator, how they deliver service. As long as it’s secure, reliable communications from device to cloud, I mean that’s all they care about and they’d like to do that ideally in a cost effective way. So they’re not behold to, “Hey, should this be cellular? Should this be Wi-Fi?” If I can get the right performance and service level characteristics, I just want to be able to deliver secure, reliable, and ideally cost effective communications. So that makes them open to any solution. Anything that solves my problem that I can manage and operationalize and secure.
Now, start to take a look at what’s going on, in the consumer world is interesting. So the digital home and a lot of the connectivity in the house is finally taken off. I mean a lot of hyper on the digital home, but with all of the advances we’ve had in technologies, we’re starting to see modem prices in particular go down, driving things down where all of a sudden it can become cost effective that I can couple technologies and that’s where… So I can take a cellular modem and put a Wi-Fi, or Bluetooth, or a ZigBee, or Thread modem in instruct a couple stuff. And I think our cell phones really amplified this first, where you look at our cell phone, this thing obviously does cellular communications, but it also has embedded Wi-Fi. It’s had Bluetooth to talk referrals. Steven had stuff like NFC, if you think about for how do I do financial?
And the new Apple ones have got early versions of low earth orbiting satellite.
Exactly. So they’re great, great example of that. So the mobile phones, obviously this is a 1,000 dollars device, so it’s a lot easier for me to put those modems in, but I’m starting to get to the point where the consumer and the digital home with the proliferation of Wi-Fi, and Bluetooth, and even ZigBee, and some of the other digital home protocols, I can get a modem for under a dollar. So it all of a sudden becomes more feasible to say, “Hey, I’m not just going to put a cellular modem in, but I’m going to use other technologies.” And that’s going to give me more flexibility. And that gives not only could give me to the different economic structure, but if I can mix and match protocols, it can also give me more resiliency.
So a great example is, let’s say I have a dog collar, and that dog collar has both a cellular modem in and LoRaWAN modem. So a kind of low… And if you’re not familiar with LoRaWAN, it’s a great technology to do low power. It can go around anywhere from two to four kilometers. So it’s got pretty good range, it can operate on battery for quite some time. And I know the Americans will most likely aware of this, but just for the rest of the world you’ve got all these emerging networks out there, new crowdsource type business models. So Amazon, for example, has a solution based on LoRA or derivative of LoRa that’s referred to as Sidewalk. And what Sidewalk does is it takes all the next generation echo devices, it has a LoRaWAN or at least a sidewalk gateway that’s built into it, and then it can use your home network and your broadband connectivity to get back up into Amazon and they provided for free. So essentially I could have this dog collar walking around, it’s using the sidewalk network, free using a crowdsource model and it’s operating fine.
Now, let’s say that dog goes out of a neighborhood that maybe doesn’t have sidewalk or gets to a patch where it can’t talk. If I can now then flip over to the cellular network, I can continue my connectivity. So I’m operating on a free environment and really then only using that cellular network when I’m out of range and can’t communicate. Now interesting one, take the satellite example. So the three GPP that standardizes all the GSMA and all the other technologies that have emerged recently released something called release 17 of their standards. And as a part of that they have something called the release 17 non-terrestrial capabilities. And what that does is it allows a standard cellular modem and antenna with new micro code to be able to communicate up to the constellations of satellites that are going up there. So this was just standardized this past year and we’re starting to see early production stuff going in.
So Apple’s a little early version of it, you could think of it, their SOS stuff, but now I could have that same dog collar using multiple radio access technologies operate on Amazon Sidewalk. When you’re in range, which might be 90% of the time when the dog goes beyond a what’s called a border router, it could switch over to cellular, and then if the dog goes up into the hills, even beyond the terrestrial network, it could go up to the satellite network. So it’s a great example of, in this case two modems, but three multiple radio access technologies being combined to get a more cost effective and even more resilient solution. So I can now address what’s happens when I’m in the hills and I have poor cellular coverage, terrestrial cellular. So it’s an incredibly powerful way of combining these technologies together, and that’s what the enterprises are looking for, they don’t care who or how I deliver it. If I can combine technologies to get better economics, more resiliency, it gives me a better solution.
So we’re going to move on to the fourth one now. And I think there’s a difference between the first three and the fourth and the fifth. The first three are all around how the industry landscape is. On the one hand it’s fragmenting, but on the other hand it’s coming together. And what I mean by that is on the first prediction, and we’re predicting an acceleration of an existing trend, which is the point we met right at the beginning. But you’ve got the uncoupling of the MNO to the SIM and the fact that the hyperscalers are coming in, and then the Edge’s now change to become the Edge aggregation where 75% of the applications are going there. So that’s a multiple parties that were operating independently all now focusing into the one area.
On the second area you had the public and the private networks and then coming together. So you have new use cases like you mentioned on the mine and then 5G and the URLCC standard, the ability to do quality of service network slicing to the Edge can take policy and extend it to the Edge. And on the third one you talked about multi-RATs. So these Radio Access Type frequencies, they’ve already always existed, but people use them for separate use cases. And now what you’re saying is no, the device is actually… They’re now getting to the price point where you can have several of them in one device and then suddenly you get a device that is multi-RAT. And so that’s another area where all these things that were independent, you have to take my space analogy is sort of the black hole. These things are now all being pulled in and you can’t stop it.
So now we have this aggregation and pulling in together, and so that then starts to change everything. And on the fourth one, I think the fourth one is as a result of the first three certain things that we always took for granted are just going to become history, and we call it the consumer and enterprise IoT use cases converge to create new connectivity challenges. So you’ve talked technically about how consumer enterprise technology is now converging into the device, but it also means, I guess, that there will be whole new market opportunities for people and as always in those markets, certain industries or industry verticals will be the ones first take advantage of it, right?
Absolutely. And I think what’s interesting here is, I mean, start off with the home. It turns out that home adoption has often driven the enterprise market. A great example of that’s Wi-Fi, right? We didn’t have Wi-Fi in the enterprises, people started using it at home and came back to work and said, “Well, why can’t I use this?” And you did a very good business with Aaron Adam Meraki at Cisco enabling that on the enterprise side. So we’ve seen that before. But what we found was the home network still remained very separate from the enterprise network and we’d have VPNs that we could use at home linking back into the enterprise network, but we still manage our own home networks and the enterprise manage their own networks. We’re starting to see some use cases emerge that are kind of going to break that paradigm. And the two that really stick out to me are in healthcare and home energy management.
So let’s look at healthcare first. If you think about it, COVID’s really changed our expectations on remote. We always went to the doctor, we went to the clinic, et cetera. But with COVID that accelerated the need for remote patient monitoring. We needed other solutions that we could do that. And in order to do that, if I’m doing something like a heart monitor, I can’t really rely on my home network. If you look about it, I’ve got a broadband connectivity through a service provider and then I’ve got my home Wi-Fi that’s got maybe 20, 30, maybe even a 100 devices on it. And I can’t be at the mercy of the consumer being smart enough to manage that. So as remote patient monitoring starts to pick up, the ability to rely on that home network becomes a bit of a problem. Now, the counter to that, so as we start to put cellular capabilities into the remote patient monitoring, but we may be in a home that’s not very well covered by cellular or we still have one radio access technology.
So there’s a good example where if I can couple the home network capabilities with cellular, I much like I described that dog collar, I can get to a much more resilient, powerful solution. So if I may still want to use my home connectivity and broadband capabilities. If I can use the next generation of what’s home protocol, whether it’s Wi-Fi or the next generation of ZigBee, Thread, which adds IP version six and other capabilities, I could use that as a… Use my existing broadband gateway and go up and do remote patient monitoring reliably. Now as a backup, I still continue to use cellular where, hey, if I leave the home, I go outside of the Thread capabilities or Wi-Fi, I want to be able to pivot to cellular. So much like that dog collar.
The other interesting angle to that is also the home gateway. So that home gateway right now is connecting to one broadband provider. As we start to see, particularly with 5G, we’re starting to see a lot more wireless broadband or wireless fixed access. So if I look at T-mobile, Verizon in the US have been now providing home broadband connectivity over wireless. I can couple my wire line and my wireless, I have a much more resilient solution. So as you start to mix and match these technologies, not only do you get to better economics, but you get more resiliency being able to mix and match and choose the right protocols at the right time. And if one goes down I can fall back to the other. So if I lose my home broadband connection tethered, I can go over to my wireless connection. So we’re seeing that as a mixing and matching of protocols to support that for healthcare.
Home energy is even more interesting to me. So if you take a look at the rising cost of energy, you think about electric vehicles and home charging, you start to look at increase with all the natural disasters, the hurricanes, the fires, particularly in the States, we’re seeing a lot more generators and batteries. The home energy market is changing dramatically, throws solar panels to the mix where the house may actually producing energy. I may now need bidirectional, so I’m not just getting stuff from the grid, I might be contributing to the grid. So we anticipate that we’re going to start to see huge changes in how you do it in manage home energy. And there it’s a combination of re-looking at energy distribution in the house. So there’s products like SPAN, and what SPAN does is it takes that at what’s being the very old technology of that electrical box, which is just circuits, and breakers, and relays, and it turns into much more of a smart energy distribution.
So I can say, “Hey, I’m about to run my washer and dryer, I don’t want to… Let’s slow the EV charging down so I can control that energy, or I’m operating off generator power after power failure. Let’s just make sure the refrigerator gets priority. So you’re going to start to see much more sophisticated energy in the house and then you throw the solar panels on and we have to really look at our existing meters. So we do a lot of work with Itron, obviously. How does that meter now become two-way and understand, “Hey, I’m producing energy, I can now put it back to the grid. I’ve got my battery.” So there’s a whole bunch of stuff that I now need to integrate how I communicate in the home with protocols like Wi-Fi and Thread, and then how do I go back up to the grid and start to communicate with the utility providers. So I think those are two great use cases about how the home and the wide area, if you want call it that, really come together and need to be managed holistically.
And we’ve seen exactly these two use cases, which in Jeffrey Moore Parlin crossing, the casting calls them bowling pins, the first two industries to move as you cross the casting. But as I was saying, last week’s podcast was on Bioform who are doing the home example, exactly what you just said. And we also had an example of the energy management example in an earlier podcast of the idea that the consumer becomes in charge and the consumer becomes the broker and starts buying and selling electricity. And so the serial, the supply chain that took the electricity from generation through to the consumer gets broken, and the consumer becomes the intermediary with a lot more choice. And certainly we see a lot of innovation and startup activity and you mentioned Itron and others, a lot of large companies really accelerating their digital disruption programs, so that they can keep up and not get overtaken as this world changes very, very rapidly.
All right. All of the things that we’ve talked about kind of all rely on one thing, which is the final one. And it’s something of course we always talk about this Eseye, which is the device. IoT starts and ends with the device. And although that’s a fairly obvious intuitive statement, often say on these podcasts, it’s not that obvious and intuitive because a lot of people think, “No, it starts and ends with the SIM.” But it doesn’t because the SIM is just one of the components that goes into the device. But all of these use cases, you think of multi-RATs, private and public networks extending the new Edge aggregation device, the consumer hub in the home.
In every one of the four that we’ve talked about, there’s a device and these aren’t your standard devices. I mean you can’t go buy these. There’s no generic device for IoT. And in its most simple form, every IoT use case requires a custom device. And then most people, they don’t want to hire firmware engineers, do they? We’re not people who can lay out circuit boards, firmware engineers, but people who know us do battery life management. So this prediction of the device, all of these things require more complicated, more complex, more sophisticated devices. So how is that going to be approached in 2023?
Yeah. And this is probably my favorite of the predictions. I love the Gartner quote about 75% of all data processed outside the cloud. Gartner has one of the quote that I think really is applicable to this, and that is 80% of all IoT projects fail, which is why we’re not seeing the uptake that we had predicted years ago. And then, this year we did some research with Kaleido. Kaleido research did a survey of over 750 enterprises, and it was about what was challenging around IoT devices and deployment, and while connectivity was a big issue and how do you get global connectivity, which we’ve lived and been trying to solve for the aha or the really big realization they came of was 84%. So by far the biggest issue was the device, and how difficult it is to design devices that may have to operate on battery power, take Itron meters need to be out there in the field for 15 to 20 years if it’s a gas or a water meter that doesn’t have power.
So how do you design stuff where you got a moving target that operators may be changing their rules or they don’t allow you to roam. You have to be localized to operate on a network to use low power optimization. So it’s incredibly difficult to design these devices and it’s getting harder, if you actually look at a lot of the geopolitical stuff that we’re hearing all the supply chain stuff. So whether it’s a war in Ukraine, potential impending Taiwan, whole supply chains have been messed up, exacerbated by COVID and some of the geopolitical environments. So I really need to be able to design these devices with as much flexibility to be able to mix and match those protocols as we talked about, and really be able to switch operators if we need to because of a commercial change, a regulatory change, et cetera.
And at the same time it’s incredibly hard to get firmware engineers. I mean if you take a look at it, the last time I looked at Indeed there was over 3000 openings for firmware engineers and you’re competing with Tesla and other very high profile jobs. So it’s incredibly hard to get these skills. So what’s interesting is as we get more and more emphasis on the device to enable all of these, I mean really powerful business cases around IoT, you go through all the ones you’ve had on your podcast, Bioforms and everything. The decks are a little bit stacked against you in terms of dealing with the supply chain stuff and getting the firmware engineers.
So you really need as much design expertise or at least how to actually start to solve and design flexibility in there. And one of the ways to do it interesting enough is software. How can you get device intelligence software that can adapt to the changes if a new network operator, or I’ve got a modem that is sub-gigahertz where I could actually change my technology profile, move from ZigBee to Thread. As protocols emerge, have software that has done all the heavy lifting, all the testing on different networks and can then select, manage, and optimize connectivity in order to protect that device. So how do you not only design the device well, but have the intelligence embedded in it so that it can select and optimize the network technology and operators.
And so what you’re saying is that I always have the pictures when people speak. So the picture I got when you were talking about that is all this complexity that we talked about on the podcast so far. It was already difficult, but now we’ve got a ball that’s bouncing down the stairs and we’ll never catch you. I mean, what we’re basically saying is, unless you use something that is scalable, like device resident software where you codify all of this complexity into a standard plugin if you like, to the device, you will never catch the ball that’s bouncing down the stairs.
So what the industry needs is the ability to… In a kind of weird way, it almost sounds like Twilio, doesn’t it? When we’re looking at these applications several years ago and all these applications are going to be created for their iPhones, but nobody knew how to do the comms. And Twilio said, “Here’s a plugin, it was APIs, just use these APIs, we’ll worry about the comms, you don’t have to write the code to be able to make a phone call maybe to do a video call, to send a text, use a chat bot or whatever.” It’s almost like that is that the industry needs to solve that problem because this collect complexity is getting exponentially bigger. But if there was a standard plugin, then which were most of this is codified, then I guess what you’re saying is adoption would accelerate massively.
Absolutely. And I think your Twilio for IoT analogy is great. So it’s not just that software kit and the APIs, but it’s also the integration that Twilio had done. How do I take, if I’m going to do an SMS, how do I integrate into each operator’s SMSC, which is how do you send the SMSs. So all the network and operator integration as well as the management platform, how do I actually manage that software and the SD case out there? So I think that’s a perfect analogy in the way you described it.
Bit of a loaded question, Larry, do you think there’s a chance we might see that in 2023?
I think in January of 2023, there may be a very good chance that you may see a solution like that.
At which point my lawyer tells you to stop and don’t say anything else. But pulling back to the predictions report, thanks for going through that. I mean the one constant is, of course, change and this is an incredibly exciting area, IoT. And again, the visions of everything is expanding and somehow we need to shrink it back and take this complexity away because although we have to do podcasts explaining it, at the end of the day, success is technology is when it becomes invisible. And we need to make all of this stuff invisible, and we go back to our founders who created ZigBee. You never think about ZigBee. In fact, most people, unless you’re in the industry, don’t even know what ZigBee is. But it’s in, I believe, over 4 billion devices that are used every day around the world. And so that’s incredible technology that has become invisible.
You use it multiple times a day, you just don’t realize it. And so that really is the challenge for us as an industries to get all of this because it’s about to get more complicated. It’s about good news, bad news podcast, everything is about to expand and all these different things that were different silos are about to come together and they come together in the device. So we’ve got to solve that last problem that we danced around without being specific right there. But thanks, Larry, for joining me on this. I would say to our listeners, I hope you enjoyed this one. This is a different type of podcast to the ones that we have done so far. Everything that we’ve talked about is available on the SI website. It’s called the IoT Predictions Report in a very nice little format that you can actually go through.
And as I said right at the very beginning, it is our number one, people are very interested because they really want to know what’s going to happen, if you’re building a device or you’re going to do an IoT project that’s going to have a lifetime of eight, 10, or if it’s a meter 15 or more years. It’s really important to have at least some idea of how it’s going to change because in 12 months time it won’t look exactly as it does today. And if you go back on the previous four-year predictions, and I’m sure some people out there do that, then actually they have all changed. Although they’ve been sort of constant themes, but they’ve changed and they’ve basically just accelerated and become more complicated, the rate of change. So it’s really important to see what’s going on, and we do this work and we put this material out there just because people do ask us for it.
And if any of you want to talk to us about this or anything else that we’ve said, then just reach out and we’d be glad to start a dialogue with you. But in the meantime, Larry, thanks very much. Thanks for joining us. I don’t know which IoT podcast you listened to that caused you to reach out, but it was probably must have been a good one.
Yeah, I have to go back and figure it out.
Maybe that will happen as a result of this one. Who knows? Thanks everyone for listening. This has been the IoT Leaders podcast with me. Your host Nick Earle, the CEO of Eseye. With my special guest this week, Larry Socher, who run SVP for Eseye who runs our Strategy & Alliances, and was I think 26 years at Accenture. Is that right, Larry? Yeah. 26 years-
… at Accenture. So a great CV, lots of history, and now working in the exciting world of IoT. So thanks for listening and I look forward to talking to you all again on the future podcast. Thanks again. Bye.
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