ITU Workshop on the “Internet
Internet of Things Trend and Challenges in Standardization”
(Geneva, Switzerland, 18 February 2014)
Open Source - The Business Model
for the Internet of Things?
g
Dr. Markus Weinberger
Dr
Director Bosch IoT Lab@HSG
Bosch Software Innovations GmbH
Markus.Weinberger@Bosch-SI.com
Markus.Weinberger@Bosch
SI.com
Geneva, Switzerland, 18 February 2014
2
© University of St. Gallen, Institute of Technology Management, 2013. All rights reserved, also regarding any disposal,
exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial property rights.
3
© University of St. Gallen, Institute of Technology Management, 2013. All rights reserved, also regarding any disposal,
exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial property rights.
Open Source – The Business Model for the
Internet of Things?
I don´t know.
But I´d like to share two arguments why I think
Open Source is important.
important
4
Weinberger | 18/2/2014 | © University of St. Gallen, Institute of Technology Management, 2014. All rights reserved, also
regarding any disposal, exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial
property rights.
1. Argument
Standards Perspective
5
Weinberger | 18/2/2014 | © University of St. Gallen, Institute of Technology Management, 2014. All rights reserved, also
regarding any disposal, exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial
property rights.
Trillions of connected devices


6
Cisco: 50 billion connected things by 2020 http://share.cisco.com/internet-of-things.html
International Data Corporation
p
((IDC),
), 2013: 212 billion byy 2020
© University of St. Gallen, Institute of Technology Management, 2013. All rights reserved, also regarding any disposal,
exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial property rights.
Standards are a good Idea for the IoT

Standards – Open Standards – are a good Idea for the Internet of
Thi
Things,
f two
for
t
R
Reasons
I t
Interoperability
bilit
R
Reuse
Connected devices should
exchange data in a common
language
Reusing standard components
safes development resources
IEC 60603-11
7
© University of St. Gallen, Institute of Technology Management, 2013. All rights reserved, also regarding any disposal,
exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial property rights.
Car-2-Car Communication

It would not make that much sense if only vehicles of a single OEM
were able to talk to each other.
„Dry road with
good grip!“
8
© University of St. Gallen, Institute of Technology Management, 2013. All rights reserved, also regarding any disposal,
exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial property rights.
Open Source is a good way to develop Open Standards
9

What is Open
p Source? - Wikipedia
p
In production and development, open source as a development
model promotes
a) universal access via free license to a product's design or
blueprint, and
b) universal
i
l redistribution
di t ib ti off that
th t design
d i or blueprint,
bl
i t including
i l di
subsequent improvements to it by anyone.

My belief:
“Open
p Source is at least one good
g
development
p
model for
Open Standards.”
© University of St. Gallen, Institute of Technology Management, 2013. All rights reserved, also regarding any disposal,
exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial property rights.
2. Argument
Business Model Perspective
10
Weinberger | 18/2/2014 | © University of St. Gallen, Institute of Technology Management, 2014. All rights reserved, also
regarding any disposal, exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial
property rights.
What is a Business Model?
What?
•
•
•
•
What do we
e offer to the ccustomer?
stomer?
What is the job we get done for the customer?
What is the percieved value?
How is our value proposition different from the
competition?
Value
Proposition
• What are our revenue
sources?
• What are the most important
costs and cost drivers?
Who?
Revenue
Model
Revenue
•
•
•
•
Value
Chain
• How do we create the value
proposition?
• Which key resources and
capabilities does our value
proposition
p
opos t o require?
equ e?
• Which activities are required
to deliver the value
proposition?
• Who are our key partners and
How? suppliers?
Who is our target customer (segment)?
Through which channels do we reach our customers?
Are there other stakeholders?
Who are the end-users?
© Prof. Oliver Gassmann, Dr. Karolin Frankenberger, ITEM-HSG
11
© University of St. Gallen, Institute of Technology Management, 2013. All rights reserved, also regarding any disposal,
exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial property rights.
What do Business Models in the IoT look like?
What?
What?
Value
Proposition
Value
Proposition
Who?
Revenue
Model
Who?
Revenue
Model
Revenue
Value
Chain
Revenue
Value
Chain
Boiler
Manufacturer
Boilers
How?
How?
HW Price
Oil Supplier
Oil
What?
Value
Proposition
Who?
Oil (Price per Liter)
Devices,
Maintenance
and
d Repair
R
i
Service
App
What?
Value
Proposition
Who?
Revenue
Model
Revenue
Value
Chain
Backend,
Connectivity,
Data Service
Provider
How?
Pay per Use
– Price per
kWh
Value
Chain
How?
One-Time Payments for Device
+ Flat Charge per Device under
Contract
Service
Contact
What?
Full Service
Provider
Revenue
12
Installer
Revenue
Consumer
Data
Infrastructure
License Fee +
Flat Charge per Device
Revenue
Model
Supplies
Value
Proposition
Who?
Revenue
Model
Value
Chain
How?
© University of St. Gallen, Institute of Technology Management, 2013. All rights reserved, also regarding any disposal,
exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial property rights.
Revenues
Some Characteristics of these Multi-Site Business Models
13

Theyy are like Ecosystems
y
 Highly connected
 Dynamic
 All participants need to
contribute
 All participants
ti i
t need
d tto benefit

My claim:
Open Source positively affects
 Trust
 Motivation
 Involvement
within a Business Ecosystem
© University of St. Gallen, Institute of Technology Management, 2013. All rights reserved, also regarding any disposal,
exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial property rights.
Two Claims for Open Source
14

Open
p Source is at least one g
good
development model for Open
Standards

Open Source positively affects Trust,
Motivation,, Involvement within a
Business Ecosystem
© University of St. Gallen, Institute of Technology Management, 2013. All rights reserved, also regarding any disposal,
exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial property rights.
„Dry road
with good
grip!“
Bosch IoT Lab@HSG
Thank You for Your Attention!
Your Questions
Visit us at
15

Bosch IoT Lab@HSG – www.iot-lab.ch

Blog Bosch Software Innovations – http://blog.bosch-si.com

Business Model Innovation Lab – www.bmi-lab.ch
© University of St. Gallen, Institute of Technology Management, 2013. All rights reserved, also regarding any disposal,
exploitation, reproduction, editing, distribution, as well as in the event of applications for industrial property rights.