Select excerpts from Subscribed Podcast with Chuck Martin
Chuck is a New York Times Business Bestselling author and has been a leader in emerging digital technologies for more than two decades. Considered to be one of the foremost experts on IoT, Chuck is a keynote speaker and has authored several books including Digital Transformation 3.0: The New Business -to-Consumer Connections of Internet of Things. Chuck also serves as the Editor of the MediaPost AI & IoT Daily, and hosts a podcast called “The Voices of the Internet of Things with Chuck Martin.” He is also the CEO of the Net Future Institute.
We talk to Chuck about monetizing IoT, the impact of COVID-19 epidemic on IoT businesses, and a future with drones and robotics.
We hear the term “Internet of Things” and “IoT” a lot, but what is it really in a nutshell, and how is it impacting our lives every day?
If you look at the transformations we’ve been going through–internet and mobile–we basically made that connection portable. What’s happening with the internet of things is that it’s connecting things to other things digitally. In the internet and mobile revolutions, we used to initiate the activity such as a customer would start shopping, etc. But with IoT, the devices themselves actually start to communicate with each other, and then they communicate to an individual. So it’s a totally different thing. It’s bigger than the internet and mobile revolutions because it’s so transformative globally.
How are IoT companies thinking about monetizing this technology? Is it based on data or usage and consumption or subscriptions?
The financial models are changing. The technology is getting so sophisticated that it really costs a lot to make it. And the big change happening here is that companies are moving to a subscription model so customers don’t suffer from sticker shock. PTC is a great example. They do really incredible advanced virtual and augmented-reality for big industrial companies. A couple of years ago, PTC switched to a service model. They took a big hit initially (which they knew they would) but now they’re wildly successful. It’s a better model and gives customers an insurance of sorts, and locks providers into a longer-term approach.
We recently did a study to assess the impact of COVID-19 – Subscription Impact Report: COVID-19 Edition and found that most subscription businesses are proving to be quite resilient. IoT companies are still growing but slower. Does this match what you’re seeing?
What I’m seeing is the purchase or the big acquisitions of things being pushed ahead. They’re not being eliminated, but they’re being pushed down the road. Subscriptions are not that big of a hit, so it’s not that big of a deal, and it’s way easier to get someone to pay a small monthly or quarterly, whatever, fee as opposed to buying something.
Everything for the first and second quarters is going to look awful from an acquisition standpoint, but then in the third or fourth quarter, things are going to start to get back to normal. So, anything that was an acquisition is typically being put off till later in the year, but anything that you can simply be recurring is not necessarily being pushed off.
It’s being rethought and that’s why it looks like a pause. But it’s not really a pause, people are just focused on something else at the moment. And anything that’s not critical they’re just saying, “Just put that in the back pocket for now and we’ll get back to it in a minute.”
You’ve been a long-term author and have written over 10 books. In your latest book, Digital Transformation 3.0, you break down IoT into seven types: Artificial Intelligence, Digital Voice Assistants, Smart Homes, Drones and Robots, Connected Cars, Sensors, and Virtual and Augmented Reality. Can you give us a sense of some of your findings and observations of what’s happening in the world of AI and drones?
Drones and robotics are big, especially now because of COVID-19. I’m talking about drones that fly totally remotely and can go a hundred miles to deliver something or take photos or whatever. In the future, you’re going to see robotics in stores where robots take you to an item – you’re not touching the robot, the robot is not touching you or breathing on you. And then, there’s contactless payment where you don’t have to touch the screen anymore. When you go to pick up your groceries, it’s hands-free. Somebody opens your trunk, they put the groceries in, they close it. Those kinds of things are going to come much more to the forefront as opposed to things that move people like autonomous vehicles and self-driving cars.