Gartner claims Internet of Things will require business model shake-up

Internet of Things
Internet of things pose new challenges

Computer manufacturers hoping to make cash from the Internet of Things (IoT) can't make profit selling more devices, according to analyst company Gartner.

Instead, Gartner warns, manufacturers who are hoping to make a play to compete in the IoT market will have to shake up their business models completely.

A new report published today by Gartner, called Emerging Technology Analysis: Software Licensing & Entitlement Management Is the Key to Monetizing the Internet of Things, reckons manufacturers will not only have to sell more gear, but figure out how to make money from the software they develop.

Software licensing and entitlement management will be the key to making the cash they need, the report said.

Turn on and off

The concept to use licensing to turn on and off features and capacity in different combinations to create additional value in the devices themselves and in the software that runs on top of them.

This is a similar model to how modem and router vendors can use software configuration to let customers pay to upgrade the existing device to accommodate greater bandwidth.

Device makers could provide different product tiers using licensing to unlock the appropriate features - without having to manufacture separate models.

Easy upsell

They could then quickly and easily upsell customers later by leveraging software-driven control of the device and licensing to make it easy for customers to upgrade to more expensive models.

The report suggests that IT manufacturers come up with a comprehensive management plan that supports both the online and offline licensing and entitlement life cycle. It will need to be scalabile to cope with IoT requirements in order to properly license software, Gartner said.

Latest in Pro
Finger Presses Orange Button Domain Name Registration on Black Keyboard Background. Closeup View
I visited the world’s first registered .com domain – and you won’t believe what it’s offering today
Racks of servers inside a data center.
Modernizing data centers: an efficient path forward
Dr. Peter Zhou, President of Huawei Data Storage Product Line
Why AI commonization is so important for business intelligent transformation and what Huawei’s data storage has to offer
Wix automation
The world's leading website builder aims to save businesses time with new tool
Data Breach
Thousands of healthcare records exposed online, including private patient information
China
Juniper patches security flaws which could have let hackers take over your router
Latest in News
A super close up image of the Google Gemini app in the Play Store
It's official: Google Assistant will be retired for phones this year, with Gemini taking over
Quordle on a smartphone held in a hand
Quordle hints and answers for Sunday, March 16 (game #1147)
NYT Strands homescreen on a mobile phone screen, on a light blue background
NYT Strands hints and answers for Sunday, March 16 (game #378)
NYT Connections homescreen on a phone, on a purple background
NYT Connections hints and answers for Sunday, March 16 (game #644)
Three iPhone 16 handsets on show
Apple could launch an iPhone 17 Ultra this year – but we've heard these rumors before
Super Mario Odyssey
ChatGPT is the ultimate gaming tool - here's 4 ways you can use AI to help with your next playthrough