How the Right IoT Services Provider can Shape your Pricing Model to Lower Complexity?by John Martine Author
With a prediction of over 26 billion Internet of Things (IoT) devices by 2020 (by Gartner – a global leader in research and advisory), the demand for quality IoT billing solutions is expected to rise. IoT/M2M ecosystem is forecasted to diversify as IoT systems are believed to pervade different industries like retail & payment, automotive, logistics & transportation, consumer electronics and healthcare. To meet the requirements of billing, it is expected that the role of an IoT services provider will grow considerably.
Complexity of IoT/M2M Ecosystem
IoT is a vast domain and has many important players in its ecosystem. To formulate an IoT BSS solution that delivers on all fronts, it is imperative that an IoT billing provider has knowledge about them. Some of the main players in IoT/M2M ecosystem are listed below:
1. M2M service provider – A M2M connectivity provider can be an MNO or a third party. It can either sell its services through resellers (B2B) or directly to the customers i.e. B2C.
2. Platform or application provider – It performs the task of delivering applications that are specifically used in a particular industry. It also provides a platform that is needed for development of vertical applications.
3. Provider of hardware – A device provider has the task of assembling IoT devices, which it delivers to the users via an MNO or a third party or directly to the customers.
4. Reseller or customer – A reseller sells IoT/M2M services to customers.
5. Additional services provider – It provides non-technical services in the IoT ecosystem.
6. End-user – An individual who uses IoT services.
7. MNO – A mobile network operator is a communication service provider that has bought a frequency spectrum and has a well-established mobile network. The MNO provided connectivity can be based on different prevalent IoT data connectivity platforms e.g. 2G, 3G, 4G, 5G etc.
With so many important players in an IoT ecosystem, it becomes critical to have IoT BSS modules, OSS modules and device management functionalities for effective management.
IoT Billing Provider & Pricing Models
As there are so many important players in the IoT ecosystem, it becomes hard for an IoT billing provider to manage their relationships. The main challenge for a billing provider comes in the form of managing pricing models. Some pricing models that can lower the complexity for IoT/M2M billing are:
1. Flat rate model – In this model, an MNO gets a fixed fee from the end user after the end of a month or a year (as written in the contract).
2. Enterprise device model – The pricing of this model is based on true value of the data. It provides data services based on the priority of a particular enterprise e.g. usage as part of medical services will receive a higher priority when compared with a service related to an ecommerce platform.
3. Pay-per-use model – Depending on the data used by a particular IoT device, an IoT billing provider can charge its customers for the items downloaded on to the device.
4. Consumer device model – This model works on first come first serve basis. In this model, data is the commodity and any device with a SIM can avail a flat rate plan.
All the aforementioned pricing models can be used in an IoT/M2M ecosystem for maintaining and managing various relationships. An IoT billing provider should always keep this in mind and address the complexity in IoT billing with a logical approach.
Created on May 22nd 2019 09:39. Viewed 160 times.