As the number Internet of Things (IoT) projects that get launched continues to gain momentum, a new report from Ericsson, a provider of networking equipment, suggests telecommunications carriers and managed service providers will be jockeying for position in the years ahead.
Today, most telecommunications providers are focused mainly on providing cellular connectivity and networking services that enable IoT applications. But, the Ericsson report makes it clear most carriers have ambitions that extend to providing managed services as well as turnkey IoT application services. Those ambitions should lead to a significant amount of “coopetition” across the entire IoT space, says Warren Chaisatien, global head of IoT customer engagement marketing for Ericsson.
In some cases, telecommunications carriers will be content to provide connectivity and networking services, explains Chaisatien. In other circumstances, they will look to provide additional managed services. At the top end of the opportunity, they may also choose to develop their own applications or create an ecosystem by partnering with third-party application service providers, says Chaisatien.
MSP options
MSPs, meanwhile, will need to decide to what degree they want to partner with those carriers. Every IoT application will require some level of connectivity. But, MSPs might decide to provide networking and application services of their own or act as an agent of a carrier providing those services. Obviously, there’s more IoT money to be made when an MSP provides their own services. But as practical matter, the number of IoT use cases is so broad that no one MSP is likely to be able to cover all the possibilities themselves.
MSPs, however, may never have to establish any kind of formal relationship with telecommunications carriers. Providers of communications services such as Twilio are leveraging their relationship with cloud service providers such as Amazon Web Services (AWS) to provide connectivity for IoT applications.
Chaisatien notes that carriers are anxious to foster IoT opportunities. They are being especially aggressive about cellular networking pricing offered to enterprise IT organizations deploying IoT applications, says Chaisatien.
Preparing for the future
In the meantime, MSPs should keep track of how much IoT application code is starting to move to edge of the network. While connecting devices to the Internet may seem simple enough, IoT applications will be among the most complex distributed computing applications ever built or deployed. It’s simply not feasible to transfer massive amounts of data across a network to be centrally processed and analyzed. Much of the processing involving IoT applications will need to occur on IoT gateways deployed at the edge of the network.
The number of internal IT organizations capable of building, deploying, and managing those applications on their own is extremely limited. Most organizations will be looking for a significant amount of external expertise. In fact, IoT applications may represent the single largest greenfield opportunity to come down the proverbial MSP pike in recent memory. That opportunity is only going to expand as 5G networking services enable, for example, computer vision applications to be deployed at the edge of the network, adds Chaisatien.
Clearly, IoT relationships between carriers, MSPs, and vendors will be complicated. But as is often the case in IT, whoever own the customer relationship will be in the best position to dictate terms and conditions.
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