The smartphone revolution has largely been credited with the demise of several companies that were pioneers in the PC industry, in favor of leaner and meaner startups. Now however, given the onset of the Internet of Things (IoT) revolution, legacy tech firms could have a second shot at success in the Internet’s next evolutionary phase.
Internet of Things
Estimates suggest that by 2019 there could be twice as many IoT devices connected to the Internet than the number of PCs, smartphones and tablets combined. This will generate roughly $600 billion in revenues for companies that provide IoT products and services.
The biggest gainers from the IoT boom will be chip manufacturers, IT consulting firms and networking equipment manufacturers. Further, legacy tech firms could be in a better position to gain a stranglehold on a large chunk of the IoT market for the following reasons:
Existing Customers: While a big part of the IoT will be home automation, the two biggest early adopters of the technology will be businesses and governments. Here’s where legacy tech firms can flex their muscles to win orders given their longstanding sales relationships with such customers.
Favorable Product Portfolios: The building blocks for the IoT will be networking equipment, specialized chipsets, m2m communication and cloud & database systems. Legacy tech companies have expertise in these fields and it won’t require much work to align their product offerings to serve the needs of customers looking for IoT solutions.
Installation & Support: Hardware will indeed play a huge role in the IoT, but the space is expected to be dominated by companies serving the software and services sectors. Given the requirement for hands-on installation of IoT services and customer support by governments and businesses, companies will need to dedicate massive amounts of resources which only legacy tech firms can afford.
Data Security: As with any enterprise or government technology, security is the primary concern, and it will be no different for the IoT. Customers therefore are more likely to trust large vendors with the security of their data over untrusted startups, which will again rule in the favour of legacy tech firms.
Based on insights from a BI Intelligence report
[image source: wikipedia]

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