Figure 1: The “Device ISP” opportunity. (Click the image for a larger on-screen view.) Source: Harbor Research, Inc.

Download a printable PDF of the above diagram (400 KB).

The M2M Era Is Not a Replay of the Dot-Com Era
You rarely hear the term “ISP” anymore, though it used to be one of the only geeky acronyms that even the man in the street understood. “Internet Service Provider” was what it stood for, but it really meant Internet Access Provider. ISPs existed because you couldn’t buy Internet access (and the one essential service—email) directly from carriers. As soon as you could buy those things directly—especially always-on broadband access—customers flocked to the carriers and the ISPs disappeared.

Core network providers are in a privileged position to offer value-added services because, all other things being equal, it’s always attractive to deal with a centralized, trusted source. Even so, for human-centric Internet access, the customer value proposition today remains pretty much what it always was—access and email. In the M2M/Pervasive Internet arena, however, the picture will be significantly different because access to device data will be meaningless without a robust array of data services.

In a recent Harbor Research survey of device OEMs and embedded systems professionals, nearly 80% of respondents said that receiving data services from a connectivity provider was either important, very important, or vital (see Figure 2).

“Rank the importance of Pervasive data services from a provider of Internet device connectivity.”

Figure 2: Responses to a Harbor Research survey of device OEMs and embedded systems professionals. Source: Harbor Research, Inc.

M2M Services from Access Providers? We Don’t Even Have M2M Access
Hard-core automated M2M deployment is all about data services, from warehousing to mining to integration across enterprise IT systems. It seems obvious that providers of M2M signal-travel would want to add value to the trlllions of bits of device-data that will soon move through their networks every minute. Are they positioning themselves to do so?

So far, we see no evidence that they are. In fact, we see little evidence that they’re even getting positioned to move the bits. The data-transfer offerings from major wireless providers, for example, are still almost completely human-centric and focused primarily on the handset and the PDA. After a small flurry of telemetry-related partnerships and announcements about a year ago, we’ve heard mostly silence on that subject.

Most M2M platform and service suppliers we’ve talked to are still waiting for access providers to come up with basic data-transfer rate plans that make real sense for M2M. The pricing models for handset data-traffic don’t work for networked utility meters or vending machines or industrial settings with hundreds or even thousands of connected sensors. With their primary focus on services to the handset, core providers are still living in the “telephone age” and moving on “telephone time,” not “Internet time.”

Thus most pervasive suppliers feel that it will be many years before carriers move into the device-networking “application layer,” if they ever do. And the innate sluggishness of the core is only exacerbated by the fact that M2M applications tend to be quite vertically focused and device-specific, and thus well beyond the expertise and deployment capacities of typical access providers.

Network-Level Services
Even if core providers left application-level M2M services to other players, network-level services are an even more obvious place for them to add value to signal traffic. Data security and device registry/authentication are vital layers of any M2M deployment model, and most customers would feel quite comfortable seeing such essential services standardized and offered by a trusted source at the core.

Access Provisioning Alone Won’t Sustain Profitable Growth
But as it stands today, all of the potential functions of a “device ISP” (see Figure 1)—including network-level services—are being performed by independent suppliers. If access providers are waiting for the M2M/Pervasive Internet space to mature and become safer, they should expect a much tougher struggle taking “device ISP” customers than they had taking “human ISP” customers. M2M adopters will have their device-networking deployments completely interwined with their business strategies at the deepest level. They will not feel “portable,” and their resistance to vendor-switching will be expensive to overcome.

Core providers could of course wait to see how this all shakes out, and then acquire the most successful “device ISPs.” Acquisitions are an art-form beyond the scope of this essay, but as everyone knows, they are expensive and messy affairs just as often as they are smooth successes, so we wouldn’t feel complacent about that strategy.

Sooner or later providers will come up with M2M-oriented data-transfer pricing that works for partners and end-users, and some people feel that device-driven network usage will be massive enough to sustain providers by itself. In the short term, this might be true. In the long term, we doubt it. Network usage by autonomous devices will certainly be massive, but everything we’ve seen in the past suggests that the moving of bits is a declining profit business unless the bit-movers find ways to add value and capture additional revenue somewhere in the process.

Harbor’s new online platform for research services offers continually updated intelligence and stunning data-visualization.

Static, printed reports can’t track the complex ecosystems and warp-speed pace of high tech. SmartSphere® projects can.

The brains of the Web. The brawn of server databases. The beauty of a CD-ROM.
For nearly ten years, we’ve been waiting for Web media to get good enough to let us do this. It’s finally here. Harbor SmartSphere® re-invents the whole concept of delivering research value. It’s to business research what the Pervasive Internet will be to business itself: a huge injection of dynamic intelligence and sheer voltage. SmartSphere® is online, interactive, dynamic, and visualized. There’s nothing static, rigid, or dead about it. Eventually, we at Harbor will do everything in SmartSphere® that we used to do on paper, and we’ll do it better. And you can, too. in a custom-configured project of your own, SmartSphere® can be anything you want it to be.

And yes, you can get printed reports. We’ve re-invented those, too. Not fixed, one-size-fits-all printed reports, but custom printed reports that you configure and SmartSphere® creates for you on the fly in PDF format.

See SmartSphere® and find out more right now:

1. Visit our free, live SmartSphere® demonstrations. They say pictures are worth a thousand words. What are they worth if they’re pictures of your whole world, and you can fly around inside the pictures with your mouse?
2. Download a brochure on the SmartSphere® research platform and services (PDF, 970 KB).
3. Download a brochure about our SmartSphere® “living research” projects on the M2M/Pervasive Internet phenomenon (PDF, 240 KB).

A small portion of an interactive Harbor SphereMap™. This one portrays a company’s world. You “fly around” the map by dragging it with your mouse, bringing into focus any area you want to explore. You see a company’s peers, investors, products, and alliance-structure at a glance. Clicking nodes fetches additional information from the database. Shift-clicking nodes creates new maps of other companies—and maps of markets, too.

Projects, projects, projects. Ours, and yours.
SmartSphere® is an online platform that Harbor uses to deliver Web-based services. You don’t buy SmartSphere® the way you buy a program for your computer. You buy access to one or more SmartSphere® projects. We define projects of our own on important high-tech subjects, and clients can subscribe to those projects. Clients can also define their own custom (and completely private) projects.

SmartSphere® projects are laser-focused on their subjects. No waste, no fluff, no irrelevance. A SmartSphere® project delivers continually updated information on whatever the project has been defined to track. Some of that information is created in the good old-fashioned way, by experienced researchers and analysts. And some of it is created with 21^st century tools like automated news feeds and Web-based info services. Every time you log in to a project, there’s new information—freshly tracked events, new company alliances, new company and market comparisons, enhanced company, market, and technology profiles, and insightful Harbor commentary and analysis.

When you visit our SmartSphere® demonstrations, you’ll see limited versions of our own projects. Currently, they include Pervasive Internet Suppliers, Smart Buildings, Smart Power, Wireless Sensor Networks, and Cluster Computing. Bear in mind that the full versions of these projects include vastly more information than the limited demonstration versions. The “Pervasive Internet Suppliers” project, for example, was created to replace and improve our own earlier online publication, Pervasive Internet Report.

The “Cluster Computing” demo is a brand-new project, featuring content developed in association with Barrington Partners. We’re very excited about our new alliance with Barrington. Together, we plan to develop SmartSphere®-based research on several important new technology growth areas, in both multi-client and single-client formats. (If the “Cluster Computing” project in particular interests you, send us mail or call us.)

Custom SmartSphere® projects. Your secret weapon has arrived.
You’ve heard about some of our SmartSphere® projects. Now let’s talk about yours. Does your company have business development, M&A, R&D, or sales and marketing goals? We hope the answer is yes. How would you like “living business intelligence”™ on the companies that interest or worry you? Or on the markets and technologies that are defining your future? A custom SmartSphere® project is the perfect way to do that. “Living business intelligence”™ means research that is laser-focused on your targets, and continually updated for as long as you need it.

Any collection of companies, markets, or technologies can become the backbone of a SmartSphere® project. You define who or what they are. You define what you want to track about them, and how you’d like to rank or score or weight them. You define the types of cross-company or cross-market comparisons you’d like to see.

Take action and take control.
If you’ve read this much about SmartSphere® without clicking something, it’s time to click. Here are those links once again.

1. Visit our free, live SmartSphere® demonstrations.
2. Download a brochure on the SmartSphere® research platform and services (PDF, 970 KB).
3. Download a brochure about our SmartSphere® “living research” projects on the M2M/Pervasive Internet phenomenon (PDF, 240 KB).

What do your colleagues and customers think about key Pervasive issues? Find out, fast and free.
Harbor’s site visitors are technologists and business leaders with the same thing on their minds: Internet-enabled device networking, smart services, and enterprise automation.

Our Polling Booth lets you can tap into this unique community in a very real and valuable way. Cast your own vote on a key Pervasive question and see all votes charted in real time. (Click “Vote!” in the site’s navigation to get there.) You can vote only once on each question, but you can come back any time to see the latest results. You can even cite the polling data in your own site pages or publications—providing you credit Harbor Research as the source.

We’ve started with a handful of questions about core Pervasive issues, and we’ll add more regularly. Do you want community opinion on something we haven’t asked about? We welcome suggestions for the Polling Booth at feedback@harborresearch.com.

Visit our site and try out the polls and charts. Click “Vote!” in the main navigation.