The massive amount of data being collected by software, hardware, and services is reaching unprecedented levels. As new innovations and products come to market each day, more companies—both industry giants and young startups—are vying for new ways to strike the Internet of Things (IoT) market-share gold.
Every technology that plays in the IoT is collecting data of some type. Behavioral and financial information, even personal preferences, can be aggregated to improve a consumer's experience. Though that may seem more advantageous to the industry giants (given the amount of data they possess), the smaller, nimble players can use this to their benefit.
Small players can employ this slice of data intelligently within their specific context—multiplying the effectiveness of any data they gather. Harnessing this data quickly and relevantly will be necessary to differentiate across the ecosystem, and doing so will help to capture unique user information and industry benchmarks to gain a competitive edge.
Opportunities for Smaller Players
The potential opportunity for the smaller players is huge. Industry leaders, such as ARM, Google, IBM, and Apple, know this as they continually acquire younger, high-growth IoT startups—exemplified by Amazon's recent acquisition of IoT startup 2lemetry—to take it off the board and collect its user data.
Google was one of the first to kick off a major IoT acquisition strategy with its acquisition of Nest Labs in 2014. Some may even argue that the smaller player's long-term success in the IoT will be dependent on its ability to partner, coexist, and integrate with the bigger players while adding its own proprietary data layer.
It's true that the IoT requires some level of cooperation—and will force old and new to play nice at times—but there's still a unique opportunity for the smaller players. The rise of the Internet, and the data that drives it, was never about mass aggregation to constrain the market... It's more the ability for new players to conceptualize their data and take advantage of the ongoing flow of information and services passing through the IoT.
As the Web continues to become more fragmented, the companies that get the most from their data is going to control their market. If you have access to an endless supply of user data, you can better understand your customers' demands and easily offer multi-tiered offerings sold through devices, based on their product data and user preferences.
Put on Your Thinking Cap
The real opportunity now extends beyond just monetization.