The Case for and Against OEMs Offering Connectivity in IoT Devices: Navigating the Connectivity Conundrum

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In the fast-evolving landscape of Internet of Things (IoT) devices, Original Equipment Manufacturers (OEMs) face a critical decision – whether to offer connectivity in their products. Connectivity, the ability of devices to communicate and share data and the cloud, has become a defining feature of modern IoT solutions. But OEMs are typically experts in hardware manufacturing, and not necessarily in connectivity and telecommunications; so should they or should they not offer this solution for their devices?

This article will delve into the complexities surrounding this decision, examining the potential advantages and complications that OEMs may encounter.

Advantages of OEMs Offering Connectivity in their products:

Enhanced Control and Visibility:

When a customer complains that a device is not working, having limited visibility can make the troubleshooting process significantly harder and more time-consuming. Understanding what’s happening on the connectivity side, as well as the device, gives the provider much more insight into what the issue can be and how to solve it. When the OEM has personally tested the connectivity provider and knows how it works together with the device. Users can benefit from a more integrated and cohesive ecosystem, where the different aspects work together to provide a comprehensive solution.

Remote Management and Updates:

Connected devices enable remote monitoring and management, reducing the need for physical interventions. Being able to communicate with the device allows for more functionalities to be enabled and a better experience for the User. OEMs can also push firmware updates and security patches, ensuring that devices remain up-to-date and resilient against emerging threats.

Increase customer proximity:

A manufacturer would topically sell devices to a company every few months, but communication with the customer is limited in between purchases. Providing also, the device’s connectivity allows the company and customer to have constant communication, increasing proximity. If a customer stops buying devices from this company, the company still can talk to the customer as a connectivity provider and better understand what drove this decision, as well as if there is any possibility to gain the customer back.

Competitive Edge:

In a competitive market, offering connectivity can be a differentiator, attracting tech-savvy consumers who value the convenience and advanced features provided by connected devices. A customer may be lost when it comes to connectivity, and choosing the wrong provider may have a bad impact in the perception of the device. Solving multiple issues can position the OEM as an industry leader, driving brand loyalty and market share.

Challenges of OEMs Offering Connectivity in their products:

Security Concerns:

Connected devices are susceptible to cyber threats, making security a paramount concern. OEMs must invest in robust security measures to protect user data and prevent unauthorized access, which can be a very important task.

Interoperability Issues:

The IoT ecosystem comprises diverse devices from various manufacturers, leading to interoperability challenges. OEMs offering connectivity need to ensure that their devices can seamlessly integrate with other products to provide a unified user experience.

Operational costs:

If the connectivity provider the OEM is using is not prepared to manage the company’s channel, this could increase considerably operational costs. In the IoT Connectivity market, aspects like support, visibility, invoicing, and control must be as automated as possible.

Cost and Complexity:

Implementing connectivity adds complexity to device design and manufacturing processes. OEMs may face increased production costs and may incur in additional connectivity costs if usage limits and other safeguards are not properly configured in the SIM Cards.

Conclusion

The decision for OEMs to offer connectivity in IoT devices is a nuanced one, with both advantages and complications to consider. While enhanced functionality, remote management, competitive differentiation, and of course an additional revenue stream are enticing benefits, OEMs must tread carefully, addressing security, interoperability, operational, and cost concerns.

In navigating this connectivity conundrum, OEMs should conduct thorough market research, prioritize user experience, and invest in robust security measures. By carefully weighing the pros and cons, OEMs can make informed decisions that align with market trends and consumer expectations, ensuring a successful and sustainable presence in the dynamic world of IoT.

Published by Martin Pawluszek here.

See more from Moabits on their profile page.

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