How the 'Internet of Things' Is Transforming the Meaning of Product

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WOODS D., How the 'Internet of Things' Is Transforming the Meaning of Product, Forbes, 25.06.2014

Type Article
Abstract
Link http://www.forbes.com/sites/danwoods/2014/06/25/how-the-iot-is-transforming-the-meaning-of-product/
Topics Business Model, Property

Notes

"The Internet of Things (IoT) changes the scope of most products, expanding product development into the realm of big data and software applications. When equipment can send and receive data, the way the equipment is managed, and even the business itself, can fundamentally change. Trane, a division of Ingersoll Rand, is a case in point."

"The changing IP landscape and intermediated buying model started a process in which manufacturers had to find and defend new sources of value."

"Most industries being transformed by the IoT are in transition from a world in which everything is owned by the customer to a state where advanced services help maintain higher-level systems. In the future, the manufacturer will sell an outcome, such as ensuring the air in a building remains at 72 degrees. According to Bergman, it will take time for customers to adjust to the idea of not owning as much equipment. It will also affect the design of the equipment, which will be operated differently in an “as-a-service” environment. “The enabling technology of connected devices is what really allows us to change the game and move beyond the promise of more proactive maintenance to the goal of predictively optimizing operation of that machine in a very different way than has previously been possible,” Bergman says. “What we’ve found is that customers who start purchasing HVAC as a service wonder why they ever wanted to own equipment in the first place"."